Deal Description

Description:

1. The Company is incorporated in South India, operates a chain of hotels. It operates 3-star hotels on an asset light model through a mix of lease & joint ventures.
2. They operate 8 hotels in and around Bangalore and Tirupati with 354 keys as on date
3. All properties are strategically located with quick access to major IT parks, business hubs and city centre
4. Tie-ups with marquee hotel brands such as Sarovar Hotels and Royal Orchid Hotels

Traction:

1. FY18 – FY23: Revenue = ~34% CAGR, EBITDA = ~59% CAGR
2. FY23 = INR 16.7 Cr Estimated
3. The Company’s - 55% of revenue comes from corporate bookings, 30% from travellers and 15% from direct walk-ins.
4. The Company have strong presence at Bangalore City, enables it to benefit from huge inflow of Corporate Guests due to its proximity to IT Companies.
5. Average Occupancy Rate for FY23 is 85%

Growth Drivers:

1. Revenue of Indian hotel industry is expected to increase by 15% in FY24
2. Demand will be aided by MICE and gradual pickup in business travel and FTAs. Also, specific events like G20 Summit and ICC World Cup 2023 will support revenue growth.
3. Planning to open four additional hotels at Goa, Bangalore and Vizag through a mix of owned and third-party brand.

Utilization of Funds:

Funds will be utilized for expansion of hotels by adding ~350 additional rooms through asset-light model.

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