Ventive Hospitality Limited IPO – Overview and Subscription Details – All You Need to Know

Ventive Hospitality Limited IPO – Overview and Subscription Details – All You Need to Know

Ventive Hospitality Limited IPO- Overview

The Ventive Hospitality IPO is a book-built issue worth ₹1,600 crores, consisting entirely of a fresh issue of 2.49 crore shares. The IPO subscription window opens on December 20, 2024, and closes on December 24, 2024. The allotment of shares is expected to be finalized on December 26, 2024, with a tentative listing date set for December 30, 2024, on the BSE and NSE. The price band for the issue has been set at ₹610 to ₹643 per share, with a minimum lot size of 23 shares. Retail investors can participate with a minimum investment of ₹14,789, while sNII investors require a minimum of 14 lots (322 shares) amounting to ₹2,07,046. For bNII investors, the minimum investment is ₹10,05,652 for 68 lots (1,564 shares). The IPO also includes a reservation of up to 16,313 shares for employees at a ₹30 per share discount to the issue price. This IPO offers diverse investment opportunities for retail and institutional investors, supported by a robust team of lead managers and competitive pricing. 

Period

The Ventive Hospitality IPO is scheduled to open for subscription on December 20, 2024, and will close on December 24, 2024. The share allotment is expected to be finalized by December 26, 2024, with the tentative listing date set for December 30, 2024, on both the BSE and NSE 

Pricing and Lot Details 

Ventive Hospitality Limited, a prominent hospitality asset owner focusing on luxury offerings across business and leisure segments, is launching its Initial Public Offering (IPO) with the following key details: 

• Price Band: ₹610 to ₹643 per share. The lower limit is ₹610, while the upper cap is ₹643. 
• Lot Size: A minimum investment requires 23 shares, amounting to approximately ₹14,789 at the upper price band.  
• Issue Size: The IPO aims to raise a total of ₹1,600 crore, entirely through a fresh issue of 2.49 crore shares.  
• Face Value: ₹10 per equity share, with the IPO price reflecting a premium based on the company’s valuation and market demand.  

• The Ventive Hospitality IPO follows a structured bidding system that accommodates various investor categories, including Retail Investors, Small Non-Institutional Investors (sNIIs), and Large Non-Institutional Investors (bNIIs). Below is a breakdown of investment requirements: 

Category	Lots	Shares	Investment Amount (₹)
Retail Investors	Minimum: 1	23	14,789
Retail (Max)	Maximum: 13	299	1,92,257
Small HNIs (Min)	Minimum: 14	322	2,07,046
Small HNIs (Max)	Maximum: 67	1,541	9,90,863
Large HNIs (Min)	Minimum: 68	1,564	10,05,652

Reservation Structure 

The Ventive Hospitality Limited IPO employs a structured reservation system to ensure diverse investor participation: 

• Qualified Institutional Buyers (QIBs): 75% of the net issue is reserved for QIBs, encompassing mutual funds, foreign institutional investors, banks, and other large financial institutions.  
• Non-Institutional Investors (NIIs): 15% of the net issue is allocated to NIIs, which includes high-net-worth individuals (HNIs) who bid for larger lot sizes. 
• Small HNIs (sNIIs): Minimum of 14 lots (322 shares), amounting to approximately ₹2,07,046 at the upper price band.  
• Large HNIs (lNIIs): Minimum of 68 lots (1,564 shares), totaling approximately ₹10,05,652 at the upper price band.  
• Retail Investors: 10% of the net issue is reserved for retail investors. 
• Minimum lot size: 10% of the net issue is reserved for retail investors. 

This reservation framework ensures balanced participation across institutional and individual investors, accommodating varying investment capacities. 

Key Dates & Timelines 

The Ventive Hospitality Limited IPO is scheduled with the following timeline (December 2024) 

• IPO Open Date: Friday, December 20, 2024 
• IPO Close Date: Tuesday, December 24, 2024 
• Basis of Allotment: Thursday, December 26, 2024 
• Initiation of Refunds: Friday, December 27, 2024 
• Credit of Shares to Demat Accounts: Friday, December 27, 2024 
• Listing Date on BSE and NSE: Monday, December 30, 2024 

Book Running Lead Managers 

​ The Ventive Hospitality Limited IPO is being managed by the following Book Running Lead Managers (BRLMs): 

• JM Financial 
• Axis Capital 
• HSBC Securities 
• ICICI Securities  
• IIFL Securities 
• Kotak Mahindra Capital Company Limited 
• SBI Capital Markets 

The registrar for the IPO is KFin Technologies Limited, responsible for processing applications, managing the allotment process, and handling refund-related activities for the IPO. 

Promoters Information 

 Ventive Hospitality Limited is promoted by a group of individuals and entities with substantial experience in the real estate and hospitality sectors. The key promoters are: 

• Atul I. Chordia: Serving as the Chairman and Executive Director, Atul Chordia brings over 31 years of experience in the real estate sector. He oversees the company’s overall operations and management. Atul has received several accolades, including the Hoteliers Award 2019 – Developer of the Year and the Times of India Real-Estate Icons of Pune Award 2022. 
• Tuhin Parikh: A Non-Executive Nominee Director, Tuhin holds a bachelor’s degree in commerce from the University of Bombay and a PGDM from IIM Ahmedabad. With 22 years of experience in the construction and real estate sector, he currently serves as Senior Managing Director and Head of the Real Estate Group in India at Blackstone Advisors India Private Limited. 
• Atul I. Chordia HUF: This entity is part of the promoter group associated with Atul Chordia, reflecting his personal and family stake in the business. 
• Premsagar Infra Realty Private Limited: A private entity engaged in real estate development and investments; this company is an important promoter of Ventive Hospitality Limited. 
• BRE Asia ICC Holdings Ltd and BREP Asia III India Holding Co VI Pte. Ltd.: These are foreign investment entities aligned with Ventive Hospitality, bringing international capital and expertise to the company.  

About Ventive Hospitality Ltd. 

Ventive Hospitality Limited is a prominent hospitality asset owner with a strong focus on luxury offerings across both the business and leisure segments. The company’s portfolio consists of 11 operational hospitality assets in India and the Maldives, totaling 2,036 keys as of September 30, 2024. These assets span across the luxury, upper-upscale, and upscale segments, catering to a wide range of travelers. The company partners with globally recognized operators, including Marriott, Hilton, Minor, and Atmosphere, ensuring world-class service and premium experiences. Notable properties in their portfolio include JW Marriott Pune, The Ritz-Carlton Pune, and Conrad Maldives, which are iconic luxury hotels in their respective locations. The Ritz-Carlton Pune is one of only two such hotels in India, while JW Marriott Pune is the largest luxury hotel in Pune. In the Maldives, Ventive Hospitality owns three luxury assets, which are renowned for their unique offerings, including undersea accommodations and dining experiences, further enhancing the luxury experience. 

A key strength of Ventive Hospitality is its luxury focus, with over 80% of hotel operation revenues coming from its luxury assets. This aligns with global demand trends for high-end accommodations. Their properties consistently command an ARR (Average Room Rate) premium, reflecting superior asset quality and an exceptional customer experience. For example, from January to September 2024, luxury hotels in Pune achieved an ARR index of 1.44, while the Maldives properties reported an ARR index of 1.04. 

In addition to its premium hospitality offerings, Ventive Hospitality also has a strong MICE (Meetings, Incentives, Conferences, and Exhibitions) offering. The JW Marriott Pune features the largest ballroom in Western India, enhancing its ability to host large-scale events, weddings, and conferences. Ventive Hospitality’s assets also benefit from its food and beverage offerings, which contribute up to 39.62% of the hotel operation revenues, further driving profitability. 

The company has a proven track record of development and acquisition-led growth in India and the Maldives, with a strategic focus on acquiring and developing marquee hotels across these key geographies. The company’s experienced promoters and management team bring a mix of global and local expertise, positioning Ventive Hospitality well to capitalize on strong industry tailwinds. With a strategic portfolio of high-value luxury assets, strong brand partnerships, and a track record of successful asset management, Ventive Hospitality is well-positioned for continued growth and success in the luxury hospitality sector. 

Financial Highlights 

Metric	30-Sep-24	31-Mar-24	31-Mar-23		31-Mar-22	Explanation
Assets	–	₹8,794.1 Crore	₹8,606.17 Crore	₹8,010.41 Crore		Total assets owned by the company, including both current and non-current assets. This represents the overall value of the company’s holdings at the specified dates.
Revenue	₹875.9 Crore	₹1,907.38 Crore	₹1,762.19 Crore	₹1,197.61 Crore		Total income generated by the company from its business activities. The decline in revenue from 31 March 2024 to 30 Sep 2024 is notable.
Profit After Tax	₹-137.83 Crore	₹-66.75 Crore	₹15.68 Crore	₹-146.2 Crore		The net profit or loss after taxes. A negative value indicates a loss for the period. The company incurred losses in FY 2024 and Q2 FY2025.
Net Worth	–	₹3,665.83 Crore	₹3,657.15 Crore	₹3,441.39 Crore		Represents the shareholders’ equity or the total value of the company owned by its shareholders. This includes retained earnings and capital investments.
Total Borrowing	–	₹3,682.13 Crore	₹3,599.66 Crore	₹3,291.07 Crore		The total outstanding borrowings or debts of the company, both short-term and long-term, which need to be repaid. The borrowings increased slightly from March 2023 to September 2024.

IPO Objectives 

The Ventive Hospitality IPO aims to utilize the net proceeds from the fresh issue for the following objectives: 

• Repayment and Prepayment of Borrowings: The company intends to use part of the proceeds to repay or prepay certain borrowings availed by the company, including the payment of any accrued interest on these borrowings. 
• Investment in Step-down Subsidiaries: A portion of the proceeds will be used to support the step-down subsidiaries of the company, namely SS & L Beach Private Limited and Maldives Property Holdings Private Limited, including the payment of interest through investments in these subsidiaries. 
• General Corporate Purposes: The remaining proceeds will be used for general corporate purposes, which may include funding future business expansion, operational needs, and other corporate activities. 

Subscription Status as of December 23, 2024 

Category	Subscription (times)	Shares Offered	Shares Bid For	Explanation
QIB (Qualified Institutional Buyers)	1.28	74,60,342	95,74,233	QIBs subscribed 1.28 times, bidding for more shares than offered, indicating strong institutional interest.
NII (Non-Institutional Investors)	0.89	37,30,171	33,15,358	NIIs subscribed 0.89 times, with demand lower than shares offered, suggesting moderate interest.
bNII (Bids above ₹10L)	0.96	24,86,929	23,82,800	bNII (large investors) subscribed 0.96 times, with good demand, but still lower than the shares offered.
sNII (Bids below ₹10L)	0.75	12,43,242	9,32,558	sNII (smaller investors) subscribed 0.75 times, with less demand compared to shares offered.
Retail	1.54	24,86,781	38,34,859	Retail investors subscribed 1.54 times, with a strong demand surpassing the shares offered.
Employee	4.24	16,313	69,207	Employees subscribed 4.24 times, showing very high demand relative to shares offered.
Total	1.23	1,36,93,606	1,67,93,657	Overall, the subscription rate is 1.23 times, with total shares bid exceeding shares offered, indicating a healthy overall demand.

Recommendation: 

Ventive Hospitality Limited is a prominent hospitality asset owner with a portfolio focused on luxury hotels in India and the Maldives. It operates 11 properties, including high-end assets like JW Marriott Pune and The Ritz-Carlton Pune, which cater to both business and leisure travellers. The company’s properties are managed by global operators such as Marriott, Hilton, and Minor. 

The IPO aims to raise ₹1,600 crore through the Offer for Sale (OFS) of 2.49 crore shares, with a price band of ₹610 to ₹643 per share. The company’s revenue mainly comes from luxury assets, contributing over 80% of hotel operation revenues. 

However, the company’s financials show losses in recent years, with a negative profit after tax for 2024. It has a high level of debt, which raises concerns about its financial stability. 

Analysts are divided on the IPO. Some recommend subscribing for long-term gains due to the company’s strong market position and growth prospects in the luxury segment, while others advise caution because of financial instability and debt concerns. 

In conclusion, Ventive Hospitality’s IPO presents potential for growth in the luxury hospitality market, but investors should weigh the risks related to its debt and recent financial performance before making a decision.