Schloss Bangalore Ltd, operating under the iconic ‘The Leela’ brand, is making its public debut with a ₹3,500 crore IPO in May 2025. As one of the few institutionally owned, pure-play luxury hospitality companies in India, Schloss is set to attract strong interest. Below is a detailed analysis of the IPO, its business, financials, strengths, and risks.
🏢 Company Overview
- Name: Schloss Bangalore Ltd (Leela Hotels)
- Founded: Not specifically mentioned; operates Leela Hotels brand
- Business Model: Luxury hospitality — owning, managing, and franchising hotels and resorts
- Properties: 12 hotels/resorts with 3,382 keys across India (5 owned, 6 managed, 1 franchised)
- Flagship Locations: Bengaluru, Chennai, New Delhi, Jaipur, Udaipur
- Expansion: Plans for 8 new properties in Agra, Srinagar, Hyderabad, Mumbai, and more
- Promoter: Brookfield, a leading global alternative asset manager
- Credit Ratings: A- (Stable) by CRISIL and ICRA
📅 IPO Timeline
| Event | Date |
|---|---|
| IPO Opening | 26 May 2025 |
| IPO Closing | 28 May 2025 |
| Price Band | ₹413 – ₹435 |
| Lot Size | 34 shares |
| Minimum Investment | ₹14,042 |
| Issue Size | ₹3,500 crore |
| Type | Fresh issue + Offer for Sale |
💰 Use of IPO Proceeds
- Offer for Sale Proceeds: Will go to selling shareholders
- Fresh Issue Proceeds Will Be Used For:
- Debt Repayment/Redemption: Full or partial repayment of company/subsidiary borrowings
- General Corporate Purposes
🔍 Industry & Peer Comparison
- Sector: Luxury hospitality
- Segment: Premium hotels and resorts
- Key Competitors: Indian Hotels Company (Taj), EIH (Oberoi), Marriott, ITC Hotels
- Positioning: One of the only pure-play, institutionally owned luxury hotel chains
- EBITDA Margin (FY24): 48.92% – significantly above industry average
- RevPAR Growth: ₹7,037 (FY20) → ₹14,851 (FY24)
✅ Strengths
- 🏨 Flagship Properties in High-Demand Locations: Leela Palace hotels in top business/leisure cities with limited room availability
- 💡 Strong Brand Value: Over 250 awards since 2021; high net promoter score (NPS) of 84.00
- 💹 Improved Metrics: Revenue and RevPAR growth with capex of ₹654.6 Cr since FY21
- 🛠️ Operational Efficiency: Hotel employee cost at 15.3% and power/fuel at 3.9% – below industry average
- 🧾 Strong Governance: Backed by Brookfield, with focus on compliance and risk controls
⚠️ Risks & Concerns
- 📍 Revenue Concentration: 92.92% of income from just 5 properties; regional disruptions could hurt performance
- 📉 Consistent Losses: ₹36.39 Cr loss in 2M FY25; losses in FY22–24 signal persistent financial stress
- 💸 Negative Cash Flow: Cash outflows in FY22–24 with liquidity risks if trend continues
- 🚩 Negative Net Worth: ₹2,784 Cr as of May 2024, worsening year-on-year
- ⚖️ Litigation & Legal Issues: Ongoing cases including tax disputes
- 📆 Seasonality Risk: Demand spikes only in the second half of the year; exposure to tourism cycles
📑 IPO Document
For complete details, refer to the official DRHP here:
📄 SEBI RHP – Schloss Bangalore Ltd (PDF)
(Note: Link placeholder – actual RHP is hosted on SEBI’s IPO portal)
📌 Disclaimer
This analysis is based on publicly available information including DRHP, RHP, and stock exchange filings. It is provided for informational purposes only and does not constitute investment advice. Readers should conduct their own due diligence or consult a financial advisor before investing.