Saj Hotels IPO: A Comprehensive Guide to the Latest SME IPO
Saj Hotels Ltd is set to launch its SME IPO in September 2024, offering investors an opportunity to invest in a hospitality brand with a long-standing presence in India. Below is a detailed guide covering all aspects of this IPO, including company background, key IPO details, financial performance, and more.
Saj Hotels: Company Profile and Background
Saj Hotels Limited, incorporated in February 1981, is a well-established player in the hospitality industry. The company offers a variety of services, including traditional resort accommodations, villa rentals, and restaurant/bar properties, ensuring a memorable experience for guests.
Key highlights of Saj Hotels' operations:
- Owns or leases three resort properties: Two managed by Saj Hotels, and one leased to other operators.
- Resorts serve as versatile venues for conferences, weddings, and social events.
- Saj Hotels has expanded its portfolio through a 50% investment in My Own Rooms Dot In Private Limited, further diversifying its hospitality offerings.
Saj Hotels IPO: Key Details and Dates
Here are the essential details for the Saj Hotels IPO:
- IPO Opening Date: September 27, 2024
- IPO Closing Date: October 1, 2024
- Listing Date: October 7, 2024
- Face Value: ₹10 per share
- Price: ₹65 per share
- Lot Size: 2,000 shares
- Total Issue Size: ₹27.63 Crores
Objects of the Issue
The IPO proceeds will be used for:
- Capital Expenditure: Expansion of existing resort properties.
- Working Capital: Supporting the company’s day-to-day operations.
- General Corporate Expenses: Enhancing operational efficiency and meeting miscellaneous corporate expenses.
Financial Performance and Projections
The financial performance of Saj Hotels Ltd has shown growth in revenue, although profitability has slightly declined in recent years. Below is a snapshot of the company’s financials:
| Period Ended | 31 Mar 2024 | 31 Mar 2023 | 31 Mar 2022 | 31 Mar 2021 |
|---|---|---|---|---|
| Assets | ₹9,808.46 lakh | ₹9,892.53 lakh | ₹9,626.45 lakh | ₹3,286.02 lakh |
| Revenue | ₹1,455.49 lakh | ₹1,282.19 lakh | ₹1,287.90 lakh | ₹812.14 lakh |
| Profit After Tax | ₹344.68 lakh | ₹355.76 lakh | ₹144.25 lakh | ₹-120.18 lakh |
| Net Worth | ₹1,734.49 lakh | ₹1,316.84 lakh | ₹891.08 lakh | ₹754.46 lakh |
| Reserves | ₹7,721.70 lakh | ₹8,325.19 lakh | ₹7,977.20 lakh | ₹1,748.59 lakh |
| Total Borrowing | ₹291.52 lakh | ₹614.14 lakh | ₹1,053.54 lakh | ₹938.51 lakh |
Between FY 2023 and FY 2024:
- Revenue grew by 13.52%.
- Profit after tax (PAT) declined by 3.11%, reflecting challenges in maintaining profitability despite increasing revenue.
Grey Market Premium (GMP) Analysis
The Grey Market Premium (GMP) is an important indicator of the market sentiment toward an IPO before its official listing. The GMP for Saj Hotels' IPO will be available closer to the listing date and can provide insight into early demand for the stock.
IPO Allotment Process and Timeline
The allotment process for the Saj Hotels IPO will follow the standard steps:
- Allotment Finalization: Expected by October 4, 2024.
- Refund Process: Refunds for unsuccessful applicants will begin by October 5, 2024.
- Allotment Status Check: Investors can check their allotment status via the registrar’s website using their PAN or application number.
Risks and Opportunities
Investors should be aware of the potential risks and opportunities associated with investing in the Saj Hotels IPO:
- Strengths: Strong market presence, experienced management, and expansion plans.
- Weaknesses: Margins under pressure due to rising operational costs.
- Opportunities: Growing domestic tourism and increasing demand for premium hospitality services.
- Threats: High competition and economic challenges affecting the hospitality sector
Conclusion
The Saj Hotels IPO is an opportunity to invest in a growing hospitality brand with expansion plans and a diversified service offering. Investors should carefully review the company's financials, IPO objectives, and market position before making any investment decisions.