simply avoid this company
Silver Pearl Hospitality & Luxury Spaces Limited IPO
i. Silver Pearl is a hospitality company that operates in the mid-priced hotel sector, consisting of the upper-midscale, midscale and economy hotel segment. Their current properties are located in Rakchham, Kinnaur, and Himachal Pradesh. Rakchham village is located in Sangla Tehsil of Kinnaur district in Himachal Pradesh, India. Rakchham village is around 10 km from Chitkul and around 12 km from Sangla and is located between the two. They also operate a café at Rakchham.
ii. All their hotels, cafes and restaurants are operated under the brand name “Osiya”. The company provide authentic hospitality and give their guests a localized and memorable experience. They seek to cater to family as well as adventure loving guests and deliver differentiated yet superior service offerings, with a value-for-money proposition. Currently, they are operating with 36 rooms in 4 properties.
iii. The company undertake its business through:
- direct ownership of hotel properties,
- long-term lease or license arrangements for the land on which they construct their own hotels,
- long-term leases for existing hotels or home stays which are owned by third parties, and
- marketing agreements.
iv. As of the date of this Prospectus company’s portfolio consisted of the following:
1. Osiya Shambhu Lodge at Rakchham – Leased Property
2. Osiya Shoshla Café – Leased Property
3. Osiya Rangnoo Rakchham Retreat – Leased Property
4. Osiya Tashi Dolma Home stay – Marketing & Branding
5. Osiya Baba Inn Guest Home – Marketing & Branding
v. Competitive Strengths:
- Experienced promoter and management team.
- Operational efficiency.
- Customer Experience
Objects of the Silver Pearl Hospitality & Luxury Spaces Limited IPO:
Silver Pearl Hospitality & Luxury Spaces Limited IPO Details:
|Open Date:||Jun 06 2022|
|Close Date:||Jun 09 2022|
|Face Value:||₹ 10 Per Equity Share|
|Issue Type:||Fixed Price Issue|
|Issue Size:||9 Cr.|
|Lot Size:||8000 Shares|
|Issue Price:||₹ 18 Per Equity Share|
|Listing At:||BSE SME|
|Listing Date:||Jun 17 2022|
Promoters And Management:
Financials of Silver Pearl Hospitality & Luxury Spaces Limited IPO:
|Particulars (in Lakhs)||Mar-22||Mar-21||Mar-20|
|Purchase of Stock||0.00||0.00||0.03|
|Changes in Inventories||0.00||0.00||2.47|
|Employee Benefits Expense||8.58||3.64||8.10|
|Profit before tax||15.34||4.53||0.36|
|Total Tax Exps||3.61||1.23||-0.12|
|No. of shares||78.53||78.53||78.53|
Comparison With Peers:
|Name of the Company||Sales (In Cr.)||PAT (In Cr.)||EPS||PE||RoCE||Mcap (In Cr.)||Returns 3Y||Sales Growth (3Y)|
|Silver Pearl Hospitality & Luxury Spaces Ltd||45||12||0.15||120||2.60%||14||-||54%|
|The Byke Hospitality Limited||83||-14||-3.57||-10.7||-4.58%||153||54%||-44%|
|Kamat Hotels (India) Limited||144||-23||-9.61||-6.55||6.91%||148||28%||-39%|
|Aruna Hotels Limited||0||-2||-0.73||-14.93||1.07%||37||171%||0%|
Recommendation on Silver Pearl Hospitality & Luxury Spaces Limited IPO:
Review and Recommendation of Silver Pearl Hospitality & Luxury Spaces IPO by InvestorZone is 3/101. The hotel sector does not have any moat and generally, these businesses have not made any wealth for investors in the stock market. 2. Though company has shown good growth in the last 3 years but scale of business is very low. They are just making a revenue of 45 lacs which thousands of hotels in India are doing. So, nothing enticing. 3. Hotel business is cyclic and highly competitive sector. 4. Dispute of Promoter Mr. Rajesh Kumar Negi with his brother over ownership of the property named as Osiya Shambhu Lodge is going on in court. The matter is pending in court. 5. They are not generating any cash flow from operations in the last 2 years. 6. Asking P/E of 120 is out of this world.