‘Will focus on portfolio of business hotels in tier-I locations’
NEW DELHI : Samhi Hotels Ltd, which plans to raise ₹1,370 crore by selling shares, will continue to expand its portfolio of business hotels in India’s top cities, Ashish Jakhanwala, the chairman, managing director and chief executive, said. Most of the proceeds — ₹1,100-1,150 crore—will go towards reducing debt, he said. The Gurugram-based company has 31 hotels, both owned and leased, across the country with 4,800 rooms.
Earlier this year, it acquired ACIC, which had six operating hotels. The price band per share has been set between ₹119-126. Samhi launched in 2010 and works with eight hotel management companies such as Marriott International Inc., Hyatt Hotels Corp.
and Hilton, among others. It first filed its papers with the Securities and Exchange Board of India (Sebi) for an initial public offering (IPO) of up to ₹2,000 crore in September 2019 and obtained the markets regulator’s approval in November 2019, but it did not go ahead with the plan. Edited excerpts: We are the third largest hotel room owner in India now.
The idea is two-pronged. The first would be to reduce our debt, which, of course, was impacted by the onset of the pandemic. We will use this for payment of debt.
While we are looking to solve for leverage, we also want to be able to create recurring free cash and de-leverage the firm. The net debt is ₹2,850 crore and the ₹1,100-1,150 crore of the IPO proceeds will be used to furnish this debt. We added 965 rooms from the ACIC portfolio to ours.
This integration will create a reasonable upside, both in terms of operating margins as well as efficiencies. Post our acquisition, we are now at 4,800 rooms. We see some really good growth opportunities in the next few quarters within the company.
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