September 22, 2024
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Schloss (Leela Hotels) files DRHP for Rs 5,000 crore IPO
Schloss Bangalore Plans Major IPO: A Game Changer for the Indian Hospitality Sector
Following the successful IPOs of several renewable and non-banking companies, hotel chain Schloss Bangalore is gearing up for its own initial public offering (IPO). The company, which operates the prestigious Leela Palaces, Hotels, and Resorts, has submitted its draft red herring prospectus (DRHP) to the Securities and Exchange Board of India (SEBI).
Targeting a Record-Breaking Rs.5,000 Crore
Schloss Bangalore aims to raise approximately Rs.5,000 crore, which, if successful, would mark the largest IPO in the Indian hotel sector to date. Founded in 1986 by CP Krishnan Nair and currently owned by Brookfield Asset Management, Leela Palaces has a storied history in luxury hospitality.
The IPO will consist of new shares worth Rs.3,000 crore, while existing shareholder Project Ballet Bangalore Holdings, an affiliate of Brookfield, plans to sell shares worth Rs.2,000 crore.
Brookfield’s Strategic Acquisition
In March 2019, Brookfield made a significant move by acquiring four Leela Palace properties located in Delhi, Bengaluru, Udaipur, and Chennai from JM Financial Asset Reconstruction Company for Rs.3,950 crore. Currently, Schloss operates 12 hotels across 10 cities in India and has ambitious plans to open eight additional hotels by 2028.
Financial Performance and Market Growth
Schloss has demonstrated a remarkable recovery, with consolidated annual losses shrinking from Rs.61.68 crore in March 2024 to just Rs.2.13 crore. Furthermore, the revenue per available room (RevPAR)—a critical metric for hotel performance—rose nearly 23% year-on-year, reaching Rs.9,592 in March 2024.
The Indian hospitality market is poised for significant growth, projected to expand from $24.6 billion in 2024 to $31 billion by 2029. Schloss Bangalore’s upcoming IPO positions it well to capitalize on this trend and strengthen its foothold in the competitive hospitality landscape.
Stay tuned for further updates on this exciting development in India’s hotel industry!
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