Ventive Hospitality IPO day 3: GMP, subscription status, review. Should you apply?

Ventive Hospitality IPO day 3: The initial public offering (IPO) of Ventive Hospitality, which opened for public subscription on Friday, December 20, is set to conclude today, i.e. Tuesday, December 24. The ₹1,600 crore book-built issue, with a price band of ₹610 to ₹643 per share, is a fresh issue of nearly 2.5 crore shares.

JM Financial Limited, Axis Capital Limited, HSBC Securities & Capital Markets Pvt Ltd, ICICI Securities Limited, IIFL Securities Ltd, Kotak Mahindra Capital Company Limited, SBI Capital Markets Limited are the book-running lead managers of the IPO, while KFin Technologies is the registrar for the issue.

Ventive Hospitality will finalise the share allotment on Thursday, December 26, and its shares will be listed on the BSE and the NSE on Monday, December 30.

Ventive Hospitality IPO GMP

According to stock market sources, Ventive Hospitality stock has seen a decline in its grey market premium (GMP) today. The last GMP of the Ventive Hospitality IPO shares was ₹55, down from their highest GMP of ₹67. Considering the upper price band of the issue at ₹643 per share, the estimated listing price of Ventive Hospitality shares is ₹698, a premium of 9 per cent.

Ventive Hospitality IPO subscription status

At 6:33 PM on Tuesday, Ventive Hospitality IPO had seen an overall subscription of 9.80 times, receiving bids for 14,14,61,891 shares against 1,44,34,453 offered.

The retail portion was subscribed to 5.87 times, the NII (non-institutional investor) portion was booked to 13.85 times, and the QIB (qualified institutional buyer) portion was subscribed to 9.08 times. The portion reserved for employees was subscribed to 9.49 times.

Ventive Hospitality IPO review: Should you apply?

Experts and brokerage firms have mixed views on the mainboard issue.

Canara Bank Securities has a "neutral" view on the issue. The brokerage firm observed that the company's strategic focus on hotel development rather than management ensures streamlined operations and higher returns. Lower construction costs per room further enhance profitability. A robust development pipeline of over 1,000 keys across India and Sri Lanka supports future growth prospects. However, the primary challenge remains in efficiently scaling operations in new markets.

On the other hand, brokerage firm Indsec Securities and Finance Limited has a "subscribe" view on the issue due to the company's debt reduction, robust expansion plans, and favourable industry dynamics.

Indsec pointed out that at the upper price band of ₹643, the IPO is valued at a post-issue P/B of 4.09 times and EV/EBITDA of 21 times, which is at a 42 per cent and 23 per cent discount, respectively, to the industry average.

Indsec added that Ventive Hospitality has outlined a strategic plan to increase its room inventory from 2,036 keys in the first half of FY25 to 2,403 keys by FY28. This expansion will be in a new location, diversifying the company’s revenue streams beyond its existing asset base.

Besides, the overall hospitality industry is poised for growth, driven by rising urbanisation, increasing consumer spending, and a growing preference among travellers for chain-affiliated hotels, Indsec said.

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Disclaimer: The views and recommendations above are those of individual analysts, experts, and brokerage firms, not Mint. We advise investors to consult certified experts before making any investment decisions.