Apeejay Park Hotels’ Stellar Debut: Shares Surge 21% Amid Market Enthusiasm

Apeejay Surrendra Park Hotels debuted on Dalal Street with a 20% increase over its IPO price, raising ₹920 crore to repay debts and for corporate purposes, after being oversubscribed 60 times.
Apeejay Park Hotels Soars 21% in Market Debut

Shares of Apeejay Surrendra Park Hotels made a remarkable entrance on Dalal Street today, with the stock opening at nearly 21% above its IPO price. On BSE, the stock was listed at ₹187, significantly higher than the IPO price of ₹155. Similarly, on NSE, it debuted at ₹186, marking a 20% increase.

This strong start aligns closely with these forecasts. A buoyant market and positive policy announcements in the Interim Budget, particularly for the hospitality and tourism sectors, are believed to contribute to the sector’s potential growth.

The IPO of Park Hotels saw robust demand, being oversubscribed nearly 60 times, led by overwhelming interest from different investor categories. The Qualified Institutional Buyers (QIBs) segment recorded the highest subscription at 75 times, followed by Non-Institutional Investors at 52 times, and retail investors at 30 times.

The company successfully raised ₹920 crore through this IPO, which included a fresh issue of ₹600 crore and an offer for sale of ₹320 crore by the promoter and investors. Apeejay Pvt Ltd, RECP IV Park Hotel Investors, and RECP IV Park Hotel Co-Investors were the selling shareholders.

With the intention to repay certain outstanding debts, Park Hotels plans to utilize ₹550 crore from the proceeds. The remaining amount will be allocated for general corporate purposes.

As of September 30, 2023, Apeejay Surrendra Park Hotels ranks eighth in India in terms of the number of rooms in chain-affiliated hotels, holding about 1,300 rooms or 2.80% of the country’s total inventory. The company’s financial performance shows a net profit of ₹22.95 crore on revenues of ₹272.31 crore for the period ending September 30, 2023, and a profit of ₹48.06 crore on revenues of ₹524.43 crore for the fiscal year ending March 31, 2023. As of January 2, 2024, the company’s total outstanding borrowings stood at ₹582.28 crore.

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