Chalet Hotels Limited IPO

Apply 2
Avoid 0

(i) Chalet Hotels Limited (CHL) is an owner, developer and asset manager of high-end hotels in key metro cities in India. The company’s hotel platform comprises Six operating hotels including a hotel with a co-located serviced residence, located in the key Indian cities of Mumbai, Hyderabad, and Bengaluru, representing 2,328 keys as of March 31, 2018.

(ii) CHPL is promoted by the C. L. Raheja Group (‘the group’), which has diversified business interests across Real estate development (residential and commercial), hospitality and retail. The group is a leading player in the commercial real estate development with a developed area of over 20 million square feet (sq. ft.). CHPL is the hospitality arm of the group and benefits from the vast experience of the group in real estate development, while also enjoying the financial flexibility in funding its project.

(iii) CHPL  has a tie-up with well-known international hospitality group Marriott International Inc (Marriott). The CHPL gets hotel management support from Marriott , renowned international hospitality chains with well-established global brands. All the six hotels owned by the company belong to the premium brands of Marriott, thus benefiting from Marriott’s global branding, marketing, and advertising network.

(iv)
The strength of the Company’s hotel platform is based on strategic locations, efficient design and development of the hotels, appropriate positioning in hotel segments together with branding and operational tie-ups with leading hospitality companies. All the hotel assets are located in high-density business districts of their respective metro cities with high barriers-to-entry close to airports, major business centers or commercial districts and other convenient locations. CHL also endeavor to build hotels to superior standards targeting the luxury-upper upscale and upscale hotel segments at an efficient gross built-up area and development cost per key.

(v) The Company has also developed commercial and retail spaces at close proximity to its hotels. The Company has a competitive advantage in key metro cities due to its early mover advantage in large, mixed-use developments in specific micro-markets.

Chalet Hotels Limited IPO Stock Quote & Charts

334.80

+0.75%

  • Open: 332.15
  • High - Low: 340.00 - 332.15
  • Previous Close: 332.30
  • Total Traded Volume: 76
  • Updated On: 24-May-2019

Objects of the Chalet Hotels Limited IPO:

Objective of

Chalet Hotels Limited IPO

are: A) The Offer for Sale B) Fresh Issue of 950 Cr 1. Repayment/Prepayment of Certain Indebtedness. 2. General Corporate Purposes.

Chalet Hotels Limited IPO Details:

Open Date: Jan 29 2019
Close Date: Jan 31 2019
Total Shares: 58613572
Face Value: ₹ 10 Per Equity Share
Issue Type: Book Building
Issue Size: 1641 Cr.
Lot Size: 53 Shares
Issue Price: ₹ 275-280 Per Equity Share
Listing At: NSE,BSE
Listing Date: Feb 07 2019

Promoters And Management:

Promoters of Chalet Hotels Limited Company are: (i) Ravi C. Raheja, Promoter of the Company, is a Non-Executive Director of our Company. He holds a bachelor’s degree in commerce from the University of Mumbai and a master’s degree in business administration from the London Business School. He has been on our Board since September 4, 1995. He is also the group president of K. Raheja Corp group. Ravi C. Raheja has 22 years of experience across the real estate, hotel and retail industry. (ii) Neel C. Raheja, Promoter of the Company, is a Non- Executive Director of the Company. He holds a bachelor’s degree in law and a master’s degree in commerce from Mumbai University. He has also completed the Owner/President Management Program from Harvard Business School. He has been on our Board since December 12, 1996. He is also the group president of K. Raheja Corp group. He has been instrumental in the diversification of the K. Raheja Corp group’s business from real estate development to retail and hospitality for the last two decades. He has also played a key role in the organization’s presence in retail brands namely Shoppers Stop, Inorbit Mall and Crossword. Neel C. Raheja is the co-chairman of the CII-National Committee on Real Estate and Housing, India chapter of Asia Pacific Real Estate Association Limited, and president of the NAREDCO Maharashtra, Management Committee. He has 20 years of experience across the real estate, hospitality and retail industry

Financials of Chalet Hotels Limited IPO:

 

Year

Revenue(Cr)

EBITDA(Cr)

OPM

PAT(Cr)

D/E

2014 534 132.6 24.8% -108 2.34
2015 467 89.7 19.2% -126 2.72
2016 597 155.8 26.1% -112 4.17
2017 924 430.8 46.6% 127 5.08
2018 929 351.4 37.8% 31.1 4.8
6MFY19 497 1340 26% -43.6 5.28
IZ Review 1. The Performance of the Hotel is erratic operationally. 2. The Debt to Equity up to 6MFY19 is 5.28 which is very high. However, the Debt/Equity Post Issue would become 1.74 as the company will get 950 Cr from the issue proceeds. 3. The EBITDA Margins are falling continuously in the last 3 years. 4. The bottom line has again gone into losses in the first 6M of FY19 after two years of good performance.

Comparison With Peers:

 
Company Revenue(Cr) EBITDA  EBITDA Margins Debt/Equity EV EV/EBITDA
Lemon Tree 492 144 29.30% 0.81 6292 43.69
Chalet Hotel 929 351 37.8% 4.8 8173 23.28
EIH 1704 405 24% 0.13 10672 26.35
Indian Hotel 2639 686 25% 0.35 17907 26.10
The Valuation in terms of EV/EBITDA for Chalet Hotels looks cheap to peers. Returns in 5 Years by these Peers( Dividend Excluded): 1. Indian Hotel= 24% CAGR Return. 2. EIH = 37% CAGR Return. 3. Lemon Tree= 20% CAGR Return from its listing last year.

Recommendation on Chalet Hotels Limited IPO:

Review and Recommendation of Chalet Hotels Limited IPO from IZ team is: 4/10. [ The Valuation in terms of EV/EBITDA is priced equivalent to peers. The performance of the hotel is erratic operationally. The competition in the sector from new entrants like OYO and Airbnb is huge as they are working on a newer concept as to how hotels were operated previously.]

IPO Review By Market Wizard

 

Registrar of Chalet Hotels Limited IPO:

  1. Karvy Computershare Private Limited

Company Address:

Chalet Hotels Limited Raheja Tower, Plot No.C-30, Block ‘G’, Bandra Kurla Complex, Bandra (East), Mumbai 400051 Phone No. +91 22 2656 4000 E-mail: investorrelations@chalethotels.com Website: www.chalethotels.com

Bid Details of Chalet Hotels Limited IPO as on
31-Jan-2019 18:00:00 IST

No.of shares offered No. of shares bid No. of total times
11,711,444 54,543,307 4.66
8,884,569 9,780,408 1.10
20,730,659 583,848 0.03
- - -
- - -
41,326,672 64,907,563 1.57
No.of shares offered No. of shares bid No. of total times
11,711,444 14,712,376 1.26
8,884,569 6,612,598 0.74
20,730,659 405,927 0.02
- - -
- - -
41,326,672 21,730,901 0.53
No.of shares offered No. of shares bid No. of total times
11,711,444 39,830,931 3.40
8,884,569 3,167,810 0.36
20,730,659 177,921 0.01
- - -
- - -
41,326,672 43,176,662 1.04

Discussion on Chalet Hotels Limited IPO:

    MSTC Limited IPO
    March 13 to 15 MSTC IPO Dates
    Size approx 225/250cr
    Price approx below 150/-
    would be trade to trade listing…

    very expensive IPO in such market condition
    with only few properties its asking such high market cap
    Overall debt is too high
    As an investor, i would not even want to apply even if it was price at half of this issue price.

    *New IPO Norms – Important*
    1) As per new guidelines *Third Party Bank Account* will not be valid

    2) Every Investor has to Fund from his own Bank Account.

    3) In case of joint account only *First applicant can apply*

    4) There could be a *single application per bank account*

    5) The above is applicable to the issue *Chalet Hotels Ltd*

        If you do not have online banking then you can fill the IPO form and submit it to the broker.

        But if we don’t have online bank account then how our account will block application amount

          What do you mean by Online Bank Account? Don’t you have bank account?

          Having co opp Bank ac which not give asba facilities.

          Till now I bidding app in third party ac

    Sir
    I rec’d some messages that ipo rules change from this ipo.

    Applicant apply ipo only from his account.

    Not from any third person ac

    Price band of Chalet Hotels is almost finalized.
    Rs 275 to Rs 280
    We will soon have an official announcement.

    *Xelpmoc Design & Tech Ltd*
    Issue Date 23 Jan 2019 to 25 Jan 2019
    Price Band 62 -66
    Lot Size 200
    Retail Discount 3 Rs
    Application Amount 12600

    Retail app. for 1 time *1825*

    Narmada Bio chem- Price band: 120 to 125
    Total issue size 90 cr
    15% QIP
    35% Retail
    50% HNI
    Issue opening: 5th to 7th February
    Listing on nse , bse main board. (Fwd)

    Hoping to see Market Wizard and other seniors take on this issue.
    On a cursory look, some of the issues seem to be
    1. Debt/Shareholder fund ratio of 5.50
    2. Is stated purpose of the IPO is to decrease debt?
    3. Fluctuating EPS between profit and loss between 2018: 1.19, 2017: 8.14 and 2016: loss (7.43)
    Similarly RONW has no steady pattern
    Hotel industry commands very high P/Es and the issue is likely to be highly priced as well.

    First IPU after recent fall in the market and a new IPO of 2019… what will be the valuation?