Management

• Nirupa Shankar (Director)
• Vineet Verma (Director)
• Amar Shivram Mysore (Non-Independent and Non-Executive Director)
• Bijou Kurien (Independent Director)
• Anup Sanmukh Shah (Independent Director)
• Jyoti Narang (Independent Director)
• Nakul Anand (Independent Director)
• Manoj Agarwal (Chief Operating Officer),
• Arindam Mukherjee (President of Engineering)
• Ananda Natarajan (Chief Financial Officer)

Use of Proceeds

The total issue size is Rs. 759.60 crs, which comprises an entire fresh issue with no offer for sale (OFS) component. The company intends to utilize Net Proceeds towards repayment/ prepayment/ redemption, in full or in part, of certain borrowings availed by the company (413.69 cr) and material subsidiary (54.45 cr), payment of consideration for buying of Undivided Share of Land from Promoter, BEL (107.5 cr) and rest for pursuing inorganic growth through unidentified acquisitions and other strategic initiatives and general corporate purposes.

Competitive Strengths

Strategically Located Hotel Portfolio Backed by Scale and Demand-Led Development Brigade Hotel Ventures operates nine well-positioned hotels with 1,604 keys across high-growth cities such as Bengaluru, Chennai, Kochi, Mysuru, and GIFT City. These properties, run by global brands like Marriott, Accor, and IHG, are typically located in demand-centric micro-markets characterized by dense populations, IT hubs, premium neighborhoods, and strong commercial or leisure activity. Leveraging its deep industry understanding and the real estate expertise of its promoter BEL, the company identifies locations with high footfall and long-term potential—particularly near airports, retail zones, and business districts. Many of its hotels have larger-than-average room inventories, offering scale advantage. Notable examples include Sheraton Grand Bangalore, Grand Mercure Koramangala, and Four Points Kochi. Its Holiday Inn Racecourse property was also a pioneer in the upper-midscale space in its micro-market.

Asset Management-Led Efficiency and Cost Optimization Brigade Hotel Ventures adopts an asset management-focused model, where it owns or leases properties while global hospitality players manage operations under branded contracts. This structure ensures access to international standards, talent, and systems while allowing BHVL to retain control through rigorous oversight of budgeting, performance, and staffing. The company actively optimizes costs through space-efficient design, renewable energy usage, and shared services across finance, IT, and HR. Strategic facility upgrades—like converting underutilized spaces into high-revenue venues—have boosted food and beverage earnings. Staffing efficiency has improved, with a declining staff-to-room ratio indicating better productivity. Technology adoption, including cloud-based systems, mobile ordering, contactless payments, and integrated GST billing, enhances guest experience and operational agility. Overall, the company’s asset-light yet deeply engaged approach translates into robust operational efficiency and long-term margin support.

Strong Parentage of Brigade Enterprises Enhances Strategic and Operational Capabilities BHVL benefits significantly from being a subsidiary of Brigade Enterprises Ltd (BEL), a well-established real estate developer with a diversified presence across residential, leasing, and hospitality segments. BEL has executed large-scale projects of over 24.5 million sq. ft. in real estate and 7.4 million sq. ft. in leasing since 2021 and brings deep domain expertise in project development, location selection, and mixed-use planning. This relationship enables BHVL to access premium land parcels, execute hotel developments cost-efficiently, and leverage BEL’s trusted brand and corporate relationships for clientele acquisition. BEL’s focus on quality is evident as multiple BHVL properties were upgraded to higher-tier brands post-construction due to superior design and execution. Additionally, shared services in HR, finance, and legal enhance BHVL’s cost and operational efficiencies. The backing of a listed entity with strong market credibility and execution history positions BHVL well for sustained growth and institutional investor confidence.

Well Positioned to Benefit from Strong Industry Tailwinds Brigade Hotel Ventures is well-placed to capitalize on favourable macro trends in the Indian hospitality sector. With travel demand rising across business, leisure, MICE, and religious segments, the industry is expected to witness long-term structural growth. WTTC estimates the sector’s contribution to India’s economy will grow at a 7.4% CAGR, reaching Rs.43.3 trillion by 2034. Simultaneously, rising foreign tourist arrivals (FTA), projected at 100 million by 2047, are expected to benefit premium hotels through improved average daily rates. Domestic tourism is also projected to hit 15 billion visits by 2047, driving broad-based demand. Additionally, demand for chain-affiliated hotels has nearly doubled over the past decade. BHVL's presence in high-growth markets like Bengaluru, Chennai, and Kochi positions it to tap into expanding IT/ITeS hubs and increasing air traffic, especially in Southern India, which accounted for over 65% of India’s IT exports and 28.7% of national air traffic in FY25—underscoring its strategic advantage.

Peer Comparison

Key Risks & Concerns

High Revenue Concentration Increases Location-Specific Risk Exposure Brigade Hotel Ventures is highly dependent on a few properties, with 63% of FY25 revenue from Bengaluru and 62% from just three hotels. This geographic and asset concentration exposes the company to localized risks. Any disruption in these key markets could impact financial performance, making diversification crucial for long-term stability and reducing earnings volatility.

Dependence on Global Hotel Operators Limits Control and Increases Renewal Risk Brigade Hotel Ventures’ heavy reliance on global operators like Marriott, Accor, and IHG poses significant risks. These partners contribute major revenue but retain operational control, limiting BHVL’s decision-making. Termination or non-renewal of agreements could disrupt business. Obligations around fees, asset approvals, and branding restrict flexibility, exposing the company to operational, contractual, and partner-specific vulnerabilities.

High Competitive Intensity Poses Operational and Pricing Risks Brigade Hotel Ventures faces intense competition from larger players and alternative accommodation in key markets. New hotel supply and rising marketing spends could pressure occupancy and margins. Success hinges on maintaining pricing, service quality, and brand appeal amid evolving demand patterns, which may challenge long-term profitability and market positioning.Top of Form

Outlook and Valuation

Brigade Hotel Ventures Limited (BHVL) is a leading owner and developer of hotels in key Indian cities, primarily in South India. As of March 31, 2025, it is the second-largest owner of chain-affiliated hotel rooms in South India among private players, with a portfolio of nine operating hotels totaling 1,604 keys across Bengaluru, Chennai, Kochi, Mysuru, and GIFT City. BHVL’s properties are operated by global hospitality giants—Marriott, Accor, and IHG—across midscale to upper-upscale segments, offering comprehensive amenities including F&B, MICE, spas, and gyms. The company follows an asset-heavy or leased-asset model with third-party operations while maintaining strong performance oversight. Financially, BHVL has shown healthy growth, with revenue increasing from ₹350 crore in FY23 to ₹468 crore in FY25, and EBITDA margin improving from 28% to 35% over the same period. Backed by its promoter Brigade Enterprises Ltd. (BEL) and a seasoned leadership team, BHVL is well-positioned for sustainable expansion in India’s premium hospitality sector.

Brigade Hotel Ventures plans to expand its portfolio with five new hotels. These include a luxury beach resort in Chennai under the 'Grand Hyatt' brand, two upper midscale hotels in Bengaluru under 'Fairfield by Marriott', a luxury hotel in Hyderabad under the 'InterContinental' brand, and a wellness resort in Vaikom, Kerala under 'The Ritz-Carlton' brand. The Kerala resort spans 14.7 acres, of which BHVL owns 7.08 acres and will acquire the rest from Brigade Hospitality Services. The Chennai and Bengaluru projects are targeted for completion by FY28, while the Hyderabad and Kerala projects are scheduled for FY29 completion. Out of the total IPO proceeds of Rs 760 cr, BHVL will utilize ~Rs 468 cr towards debt repayment, which will lead to reduction in D/E to below 1.0x from 7.1x currently and improvement in profitability as interest cost saving of ~Rs 45 cr will flow through the P&L.

However, the company’s near-term growth outlook appears constrained, as a significant portion of future capacity—five new hotels—is expected to become operational only by FY28–FY29. This delays meaningful revenue expansion and return generation in the medium term. Additionally, high dependence on select geographies (notably Bengaluru) and third-party operators adds concentration and execution risk. While BHVL offers a quality platform with long-term potential, we recommend investors avoid the IPO at this stage and revisit once visibility improves. Its debt repayment plan is the key monitorable after its listing. The company is valued at an EV/EBITDA multiple of 25x, based on the upper price band and post-issue capital. We recommend an AVOID rating for the issue.