Pride Hotels targets IPO by March 2026 to fund renovations: Chairman

Hospitality chain Pride Hotels is targeting to launch initial public offering (IPO) by March 2026 to fund renovations of existing properties and pare debt, its Chairman & Managing Director Sureshchand Premchand Jain said.

The Pune-based company, which filed its preliminary papers with markets regulator Sebi in October, is awaiting regulatory approval to float the IPO.

The proposed IPO comprises a fresh issue of equity shares worth Rs 260 crore and an offer for sale (OFS) of 3.92 crore equity shares by existing shareholders.

Of the fresh issue proceeds, Rs 159.68 crore will be used to modernise and renovate existing hotels, Rs 40 crore for debt repayment, and the balance for general corporate purposes.

Total borrowings stood at Rs 65 crore as of March 2025, the draft papers showed.

Elaborating on the utilisation plan, Jain told PTI that the company intends to deploy the funds over the next 12 to 27 months to undertake renovation, refurbishment and upgradation of six out of seven hotels in its owned portfolio. These properties are located in New Delhi, Ahmedabad, Kolkata, Bengaluru, Pune and Chennai.

Founded nearly four decades ago, Pride Hotels operates its chain of hotels and resorts under the "Pride Hotels and Resorts" brand. Its current portfolio of 34 hotels comprises seven owned properties and 27 managed properties.

Apart from refurbishing its existing assets, the company is also accelerating its expansion plans.

Chief Executive Officer Satyen Jain said Pride Hotels has expanded its footprint from 19 hotels in 2019 to 34 at present, and has another 32 properties in the pipeline that are expected to become operational over the next two to three years.

He added that the expansion strategy is focused on strengthening the company's pan-India presence, with an emphasis on business hubs, leisure destinations and pilgrimage centres.

Within the pipeline portfolio, Pride Hotels has 21 properties under development, aggregating around 1,500 keys across 19 locations. These include upcoming business and leisure destinations such as Aurangabad, Nainital, Amritsar and Alwar, as well as pilgrimage centres like Ayodhya and Palitana.

In addition to this, the company has signed 11 letters of intent with third-party owners to operate additional hotels and resorts, adding about 841 keys to its network.

This expansion will largely be driven through the managed portfolio under an asset-light model, enabling rapid scale-up with limited capital expenditure, the CEO said.

At the same time, he said that the company plans to selectively pursue owned portfolio opportunities, including the acquisition of strategically located hotels that offer potential for operational turnaround.

On the financial front, the company reported a rise in profit after tax to Rs 83.5 crore in FY25 from Rs 66 crore in the previous fiscal, while revenues increased to Rs 305.62 crore from Rs 270 crore.

Industry prospects also remain supportive and according to a Horwath Report, the Indian hospitality sector had 209,000 chain-affiliated rooms as of June 30, 2025, with an additional 118,000 rooms expected by FY 2030. Moreover, about 66 per cent of the upcoming supply is projected to come from cities outside the top six metros.

However, this rapid expansion especially in Tier 2 and Tier 3 cities is expected to intensify competition across segments and geographies.