1. At a Glance (≈ 50 words)
Brigade Hotel Ventures is launching a ₹759.6 crores IPO (₹85–₹90 per share) solely via fresh issue to repay debt and fuel expansion. With 1,604 keys across nine hotels, the company has switched to profit after FY23 losses—but valuations at ~125–145× FY25 EPS look spicy. ClearTax+15Finshots+15Moneycontrol+15
2. Introduction with Hook
Think of BHVL as the hospitality cousin of Brigade real estate—stepping onto stage with ₹470 crore topline and ₹24 crore PAT in FY25. They’re promising glamour via Marriott and IHG, boasting 76% occupancy, and using IPO proceeds to slash down debt of ₹617 crore. But that P/E of 125–145x? Feels like booking a luxury suite, hoping occupancy holds. FinshotsmintThe Economic Times
3. Business Model — WTF Do They Even Do?
BHVL owns and develops upscale hotels in South‑India (Bengaluru, Chennai, Kochi, Mysuru, GIFT City). Their model: own the real estate, outsource operations to global chains like Marriott, Accor, and InterContinental. They manage cost via shared services, solar and wind energy, and tight staff/rev optimisation. The Financial Express+4mint+4Zerodha+4
Irony: they’re hospitality owners who don’t host parties—they simply rent space to brands.
4. Financials Overview — Big Numbers, Bigger Snark
FY25 vs FY24 (₹ Cr)
Revenue: ₹470.7 vs ₹404.9 (+16%)
EBITDA: ₹166.9 vs ₹144.6 (~36% margin)
PAT: ₹23.7 vs ₹31.1 (–24%)
Assets: ~₹947.6; Borrowings: ₹617.3; Net Worth: ₹78.6 FinshotsICICI DirectMoneycontrol
Marginal profit despite healthy margins—almost like selling a premium room at discount.
Verdict: Topline’s sprinting, bottom‑line still limping.
5. Valuation — What’s This Stock Worth?
At ₹90, BHVL commands P/E ≈ 125× FY25 EPS and P/B ≈ 32×. Some brokers point to a P/E closer to ~145× once dilution is applied. EV/EBITDA comes to ~25x. Moneycontrol+8mint+8The Economic Times+8
Fair Value Range (educated guess):
- DCF assuming 20% revenue CAGR to ₹700 cr by FY30, terminal EV/EBITDA 15× → ₹65–75/share
- Relative using peer Lemon Tree, IHCL: P/E 40–60× → ₹35–55/share
So the real range: ₹50–80/share, if you’re not Nobel‑prize–smart.
6. What’s Cooking – News, Triggers, Drama
- Grey Market Premium (GMP): ₹6–₹8, implying ~7–9% potential pop. Early signs of over‑hype. The Economic Times+6Business Standard+6The Financial Express+6
- Anchor raise: ₹324.7 cr from 17 high‑profile MFs at ₹90/share, lock‑in 30/90 days. ICICI Direct+3mint+3Business Standard+3
- Expansion pipeline: From 1,604 rooms to 2,560 by FY29, featuring Grand Hyatt, Ritz‑Carlton etc. Zerodha+2Finshots+2The Economic Times+2
7. Balance Sheet 🧾
| Item | FY25 ₹ Cr | FY24 ₹ Cr |
|---|---|---|
| Total Assets | 947.6 | 886.8 |
| Borrowings | 617.3 | 601.2 |
| Net Worth | 78.6 | 58.7 |
| Debt/Equity | ~7.4× | ~10.2× |
Snippet: Debt not drowning them yet—but coughs are loud. Finshots+1Business Standard+1
8. Cash Flow – Sab Number Game Hai
(FY23–FY25 snapshot)
| Year Ending Mar | Op CF | Inv CF | Fin CF | Net Cash Flow |
|---|---|---|---|---|
| FY23 | – | – | – | Loss-making |
| FY24 | – | – | – | Turned profitable |
| FY25 | Strong EBITDA cash conversion | Capex on expansion & land buy | Borrowing flows? |
IPO cash flow details aren’t in RHP, but expect an infusion of ₹760 cr to clean debt and fund growth.
Punchline: Cash flow is now in training—IPO fuel might turn it pro.
9. Ratios – Sexy or Stressy?
- ROCE: ~13.6% – decent but against P/E 125x? Might not cut it.
- RoNW: ~30%, impressive numerator but tiny base.
- PAT Margin: ~5%; EBITDA Margin: ~35%
- Debt/Equity: ~7.4× – scary.
Conclusion: Operationally neat, financially loaded. The Economic Times+15Finshots+15Moneycontrol+15The Economic Times
10. P&L Breakdown – Show Me the Money
| FY Year | Revenue (₹ Cr) | EBITDA | PAT |
|---|---|---|---|
| FY23 | 356.4 | 114.0 | –3.1 |
| FY24 | 404.9 | 144.6 | 31.1 |
| FY25 | 470.7 | 166.9 | 23.7 |
Verdict: Topline’s climbing, EBITDA is flexing muscles, but profitability is still a careful walk.
11. Peer Comparison
| Peer | Rev CAGR | EBITDA % | P/E (x) |
|---|---|---|---|
| Lemon Tree Hotels | ~20% | ~17% | 40–50× |
| Indian Hotels Co. | ~15% | ~12% | 50–60× |
| BHVL (IPO implied) | ~16% | ~35% | 125–145× |
Punchline: BHVL is paying surcharge for asset-owning vibe—but many post‑IPO friends are cheaper.
12. Miscellaneous – Shareholding, Promoters & Glossary
- Pre-IPO Promoter holding: 95.26% → Post-IPO: 74.1%
- Dilution: ~21 percentage points.
- Employee reservation: 8,73,103 shares at ₹3 discount.
- Shareholder bucket allows eligible BEL investors to apply up to ₹2L even if also applying in employee/retail slot. All governed by standard rules. The Economic Times+10mint+10The Economic Times+10The Economic Times+15Moneycontrol+15The Economic Times+15Moneycontrol+7Zerodha+7The Economic Times+7
Glossary:
- GMP – Grey Market Premium, unofficial sentiment.
- ROCE – Return on Capital Employed.
- IPO P/E – based on last twelve‑month EPS.
13. EduInvesting Verdict™
Brigade Hotel Ventures is clearly not your average hotel stock—it’s asset-heavy, real‑estate‑powered, and operating with Marriott‑Accor‑IHG muscle. But despite growing top line and decent occupancy, profitability is narrow, debt is towering (7.4× equity), and valuations at ~125–145× FY25 EPS seem aggressive.
If you’re a patient long‑termish investor believing in India’s premium hospitality revival and parentage support from BEL, BHVL could be a position—but only assuming execution in expansion and debt reduction. For investors expecting short‑term pops, the ~7–9% GMP is hardly a jackpot.
In short: A high‑voltage hotel IPO loaded with faith—subscribe only if you believe the show will go on without room rates crashing.
Written by EduInvesting Team | 27 July 2025
Tags: Brigade Hotel Ventures, Hospitality IPO, ₹759.6 Cr IPO, Debt Repayment, Asset‑Light Operating Model
