IPO listed on 27 Sep'23
Samhi Hotels Ltd
Minimum Investment
₹ 14,994 / 119 shares
Grey market premium
₹ 16 (13% premium)
Issue price
₹ 126
Listing price
₹ 135
Listing gains
8.5 (6%)
Listing on
Sept 22, 2023
Our Verdict:
Avoid
- Samhi Hotels has seen remarkable top-line growth but is yet to reach profitability and has a concerning negative net worth. The nature of the hotel industry demands high capital. Given the company's weak financial health, substantial debt, and hefty working capital requirements, it might struggle to tap into growth opportunities or adjust to industry shifts. This in turn could hinder its ability to compete effectively with other more financially robust players in the market.
- Taking these aspects into account, it is advisable to review the company's performance over the next two quarters before making any investment commitments.
About the company
Founded in
28 Dec'10
Managing director
Ashish Jakhanwala
- Samhi Hotels stands out as a leading hotel ownership and asset management entity in India, boasting the third largest inventory of operational keys (both owned and leased) in the country as of March 31, 2023.
- Within a span of 12 years, the company has amassed a remarkable portfolio comprising 3,839 keys spread across 25 hotels. These establishments are strategically located in 12 major urban hubs in India, such as Bengaluru, Hyderabad, the National Capital Region, Pune, Chennai, and Ahmedabad, to name a few.
STRENGTHS
- Impressive Growth: From FY21 to FY23, Samhi showcased a remarkable CAGR of 109% in its revenue, which soared to Rs 739 crore by FY23. After making a positive shift with an EBITDA of Rs 22 crore in FY22, it further escalated to an impressive Rs 261 crore in FY23.
RISK FACTORS
- Weak Track Record: The hotel industry requires substantial capital for operations, expansion, and maintenance. A company that has consistently reported losses and has a negative net worth raises red flags as it makes it hard to gauge when or if the company will turn profitable.
- Negative NAV: The negative net asset value of Rs 113.07 as of March 31, 2023, is a clear indicator that the company's liabilities exceed its assets, presenting a severe risk for potential investors.
- Financial Indebtedness: As of June 30, 2023, the outstanding borrowings stood at Rs 2,812 crore. Although the company plans to use Rs 900 crore from the IPO proceeds to address its liabilities, the residual debt of Rs 1,912 crore is substantial.
- Significant Working Capital Requirements: The nature of the business necessitates significant working capital. If the need arises to source additional financing to meet these demands, it could strain the company's cash flows and overall financial health further.
Issue details
Issue type
Mainstream
Issue size
₹ 1,370.10 crore
Fresh Issue
₹ 1,200 crore
OFS
₹ 170.10 crore
Price range
₹ 119 - 126
Lot size
119 shares
Issue Objective
Net proceeds from the fresh issue will be utilised towards:
- Repayment or prepayment of borrowings availed by the company and its subsidiaries; and
- General corporate purposes.
Dates
Bidding open
14 Sep'23
Bidding close
18 Sep'23
Allotment date
22 Sep'23
Refund date
25 Sep'23
Listing
27 Sep'23
IPO Reservations
Qualified institutional buyers
>75%
Non-institutional investors
<15%
Retail individual investors
<10%
Read the Offer Document
© 2025 by Liquide Solutions Private Limited, SEBI Registered Research Analyst (Registration number - INH000009816)
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