NEW DELHI, Apr 5
Bengaluru based Prestige Estates Projects is looking to list it’s hospitality business this year, said sources in the know. “The board has given its node for the initial public offer for the hospitality business and they are working on it, ” said sources in the know.
The company is yet to decide on the quantum of funds to be raised and percentage dilution. “Prestige will be the majority shareholder after the listing,” they said. An email sent to the company did not elicit any response.
Last month ,Prestige and global hotel company Marriott International have signed an agreement to develop six hotel projects in the country including Karnataka and Goa. The hotels will be developed in next two to five years.
Realty players plan new hotels to shore up revenues The total inventory will be 801 keys across Goa and Karnataka and Marriott is launching some of the new brands in the country with Prestige. Prestige is investing around RS 1000 crore in the new hotels with Mariott. In an investor note on Wednesday, Motilal Oswal said that Prestige currently operates ~1,500 keys of hospitality portfolio, which is set to double over the next three to four years. Once stabilized, the segment can generate revenue of Rs1800 crore (share of Prestige) as against Rs 900 crore currently. “As highlighted in 3QFY24 results call, the management is currently evaluating to monetize its hospitality portfolio, which will lead to some value unlocking. Moreover, the move can also knock off Rs 900 crore of gross debt from its books and alleviate some of the cash flow stress associated with the RS 1700 crore balance capex in the hospitality segment,” Motilal said.
Early this week, Prestige signed a Rs 2001 crore deal with Abu Dhabi Investment Authority and Kotak Alternative Investment Fund to invest in projects in four cities.
