Leela Hotels IPO: Brookfield-backed Schloss Bangalore to launch public issue on May 26, eyes ₹3,500 crore

Schloss Bangalore, the owner of Leela luxury hotels, has slashed its IPO size by 30% to 35 billion rupees ($409 million), joining a growing list of companies that have trimmed their issues due to market uncertainty.

Brookfield-backed Schloss, which initially planned a 50 billion-rupee initial public offering, will run the issue from May 26-28, its updated prospectus showed on Tuesday. Large “anchor” investors will get to bid on May 23. Schloss did not specify in its prospectus why it had cut the IPO size.

The three-day IPO will close on May 28, with the shares likely to list on June 2 on both BSE and NSE. The price band and lot size are yet to be announced.

The IPO is being managed by JM Financial, Kotak Mahindra Capital, Axis Capital, Morgan Stanley, and SBI Capital, among others. KFin Technologies is acting as the registrar to the issue.

Schloss Bangalore, incorporated in 2019, is among India’s largest luxury hospitality firms in terms of number of rooms. As of May 2024, the company operates 12 properties with 3,382 keys under The Leela Palaces, Hotels, and Resorts.

Five of these — located in Bengaluru, Chennai, New Delhi, Jaipur, and Udaipur — are wholly owned. These properties blend regal Indian architecture with modern hospitality, appealing to high-end business and leisure travellers.

In addition to rooms, the company operates 67 fine-dining restaurants and bars and 12 wellness centres. Its flagship spa at The Leela Palace Bengaluru is being developed in collaboration with luxury wellness brand Soneva

Schloss will sell fresh shares worth 25 billion rupees, down from an initially planned 30 billion rupees, while Brookfield plans to sell shares worth 10 billion rupees – half of its original plan.

The company, which runs 13 hotels, will use proceeds from the sale of new shares to repay its borrowings.