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Lemon Tree Hotels IPO Gets Sebi Nod: Here Are The Details

Lemon Tree Hotels is currently the ninth largest hotel chain in India.
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Lemon Tree hotels gets Sebi approval for going ahead with its IPO
Lemon Tree hotels gets Sebi approval for going ahead with its IPO
Hospitality chain Lemon Tree Hotels has received a go ahead from capital markets regulator Sebi to float an initial public offering. Lemon Tree Hotels, which opened its first hotel in May 2004, is currently the ninth largest hotel chain in India in terms of owned, leased and managed rooms, as of June 30, 2017, according to the company. Lemon Tree runs 40 hotels in 24 cities with 4,289 rooms and over 4000 employees.

"Our company expects that listing of the equity shares will enhance our visibility and brand image and provide liquidity to our shareholders. Listing will also provide a public market for the equity shares in India," the company said in the DRHP.

The offering which comprises up to 195,797,000 equity shares by the existing shareholders, including Maplewood, Whispering Resorts, Palms International and RJ Corp.

The offer will constitute up to 24.9 per cent of the post-offer paid up equity share capital of the company. The public issue is aimed at achieving the benefits of listing the equity shares on stock exchanges, Lemon Tree Hotels said in its prospectus.

The company had filed the draft red herring prospectus (DRHP) with Sebi in September and obtained its "observations" on December 22, which is necessary for any company to launch public offer, latest update with the regulator showed.

Lemon Tree hotels are located across India, in metro regions, including the NCR, Bengaluru, Hyderabad and Chennai, as well as tier I and tier II cities such as Pune, Ahmedabad, Chandigarh, Jaipur, Indore and Aurangabad. 

The group operates three brands to meet hotel needs across all levels. Its upper midscale segment runs under the "Lemon Tree Premier" line of hotels, its midscale segment of hotels are branded "Lemon Tree Hotels" and the economy segment is run under the brand name "Red Fox by Lemon Tree."

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