Leela Hotels IPO Sees Sluggish Demand On Day Two; GMP Declines

The initial public offering of Schloss Bangalore Ltd., the operator of the Leela Hotels' chain, continued to see sluggish demand with the issue subscribed 17% on its second day of bidding on Tuesday. It was subscribed 6% on its first day.

The grey market premium of the IPO has dropped to Rs 4 from Rs 12.5 as of 4:00 p.m., according to InvestorGain. This implies shares of the company will likely list at Rs 439 apiece, indicating a 0.9% premium to the upper end of the price band.

The IPO will consist of fresh equity shares worth Rs 2,500 crore and an offer for sale component totaling Rs 1,000 crore. The price band for the IPO has been set in the range of Rs 413 to Rs 435 per share.

The company intends to use net proceeds from the issue towards repayment of outstanding borrowings, and for general corporate purposes.

• Issue opens: May 26.

• Issue closes: May 28.

• Issue price: Rs 413–435.

• Offer for sale: Rs 1,000 crore.

• Fresh issue: Rs 2,500 crore.

• Total issue size: Rs 3,500 crore.

• Lot size: Minimum 34 shares, and then in multiples thereof.

Schloss Bangalore is an Indian luxury hospitality company that owns, operates, manages, and develops premium hotels and resorts under the 'The Leela' brand.

As of March 31, 2025, the company holds a portfolio of 13 operational hotels encompassing 3,553 keys, making it the largest pure-play luxury hospitality operator in India by room count. This portfolio includes five owned hotels, seven managed properties, and one franchised hotel.

Looking ahead, Schloss Bangalore plans to expand its luxury hospitality footprint by adding seven new properties by 2028, both within India and internationally, contributing over 678 new keys to its portfolio.

The IPO has been subscribed 0.17 times or 17% as of 5:00 p.m. on Tuesday.

• Qualified institutional buyers: 0.11 times, or 11%.

• Non-institutional investors: 0.11 times, or 11%.

• Retail investors: 0.41 times, or 41%.

The grey market premium of the IPO has dropped to Rs 4 from Rs 12.5 earlier, according to InvestorGain. This implies shares of the company will likely list at Rs 439 apiece, indicating a 0.9% premium to the upper end of the price band.

It should be noted that GMP or grey market price is not an official price quote for the stock and is based on speculation.

Disclaimer: Investments in initial public offerings are subject to market risks. Please consult with financial advisors and read red herring prospectus thoroughly before placing bids.