The Hindu Business Line : Bhagwati Banquets plans Rs 92-cr public issue

SPACING OUT: Mr Narendra Somani (right), CMD, Bhagwati Banquets and Hotels Ltd, and Mr Mohib N. Khericha, MD, Chartered Capital & Investment Ltd, at a press conference in Mumbai on Tuesday. - Paul Noronha

Mumbai April 10 Bhagwati Banquets and Hotels Ltd is coming out with an IPO to raise around Rs 92 crore at the upper end of the price band of Rs 36-40 per share. The proceeds will part-finance setting up of a 100-room five star banquet hotel in Surat, Gujarat.

The company will issue 2.3 crore equity shares, of which 1.85 crore equity shares, will be for the public.

At least, 50 per cent of the net issue to the public shall be allotted on a proportionate basis to qualified institutional buyers.

Further, 15 per cent of the net issue shall be available for allocation on a proportionate basis to non-institutional bidders, while 35 per cent of the net issue to the public shall be for allocation on a proportionate basis to retail bidders.

The issue will open for subscription on April 18 and close on April 25.

The new hotel in Surat will cost Rs 77.5 crore and will be ready in the next 18 months. The hotel's banquet facility will accommodate 5,000 people at a time and has an outdoor catering facility capable of serving 1,000 people at a time, said Mr Narendra Somani, Chairman and Managing Director of the company.

"The hotel will try to cash in on the large corporate base in Surat and focus on social events and parties," Mr Somani added.

Chartered Capital & Investments Ltd is the book running lead manager to the issue.