Suba Hotels
Book Building issueSMENSE₹75.47 Cr issue
+38.92%
Listing gain over issue price
Issue size
₹75.47 Cr
1 lot at cut-off
₹1,33,200
Lot size
1,200shares
Open
29 Sep 2025
Close
01 Oct 2025
Allotment
03 Oct 2025
Listing
07 Oct 2025
Listing performance
Issue price
₹111
Listed at
₹154.20
Listing-day close
₹161.90
Latest price
₹86.40
Close on 23 Oct 2026
Listing gain
+38.92%
Return since issue
-22.16%
Scheduled dates
Tentative timetable — a past date is not confirmation the step completed
Issue details
- IPO date
- 29 Sep 2025 – 01 Oct 2025
- Listing date
- 07 Oct 2025
- Face value
- ₹10 per share
- Issue price
- ₹111 per share
- Lot size
- 1,200 shares
- Issue type
- Book Building issue
- Listing at
- NSE
- Total issue size
- ₹75.47 Cr
- Market cap at offer price
- ₹269 Cr
- Promoter holding
- 84.69% → 60.93% pre-issue → post-issue
- ISIN
- INE0RYR01018
- Registrar
- Bigshare Services Pvt.Ltd.
- Lead managers
- Unistone Capital Pvt.Ltd.
- Registered office
- Hotel Suba Star, Judges Bungalow Road, Near Akash Tower, Bodakdev, Gujarat
Reservation and application size
How the issue is split between investor categories, and what each may bid
| Investor category | Shares | % of net | % of total |
|---|---|---|---|
| Anchor investor · within QIB | 19,17,600 | — | — |
| Market maker | 3,40,800 | — | — |
Application size
Minimum 1,200 shares per lot, in multiples, at ₹111
| Application | Lots | Shares | Amount |
|---|---|---|---|
| Retail (min) | 1 | 1,200 | ₹1,33,200 |
| S-HNI (min) | 2 | 2,400 | ₹2,66,400 |
| S-HNI (max) | 7 | 8,400 | ₹9,32,400 |
| B-HNI (min) | 8 | 9,600 | ₹10,65,600 |
Category limits
| Category | Bid size | Cut-off |
|---|---|---|
| Retail (RII) | Up to ₹2 lakh | Yes |
| Small HNI (sNII) | ₹2 lakh – ₹10 lakh | No |
| Big HNI (bNII) | Above ₹10 lakh | No |
| Employee | Up to ₹5 lakh | Yes |
Bidding at cut-off means accepting the final issue price without naming one. Only retail and employee applicants may do so.
Anchor investors
Institutional allocation placed a day before the issue opens, carved out of the QIB portion and locked in after listing.
Shares allocated
19,17,600
Anchor portion
₹21.29 Cr
at ₹111 per share
Valuation and performance
Valuation at offer price
₹111 per share
| Metric | Pre-issue | Post-issue |
|---|---|---|
| EPS (₹) | 8.69 | 6.25 |
| P/E (×) | 12.77 | 17.76 |
| Price to book (×) | 4.07 | — |
| Market cap | — | ₹269 Cr |
Key performance indicators
Latest reported period
- Return on net worth
- 31.82%
- ROCE
- 35.55%
- Debt / equity
- 1.06
- PAT margin
- 18.94%
- EBITDA margin
- 29.09%
- NAV per share
- ₹27.29
- Price to book
- 4.07
Single period as reported. Year-on-year movement is in the financials table below, where every period is published.
About Suba Hotels
Suba Hotels Limited, incorporated in 1997 and converted to public limited company in 2023, operates a diverse portfolio of 88 operational hotels with 4,096 keys across over 50 cities in India, with approximately 81% located in tier 2 and 3 emerging markets. The company operates through multiple business models including owned hotels (5 hotels, 227 keys), managed hotels (19 hotels, 823 keys), revenue share & lease hotels (16 hotels, 577 keys), and franchised hotels including Choice Hotels brands (48 hotels, 2,469 keys). Revenue for FY 2025 was ₹7,924.32 lakhs from operations, with primary revenue streams from room revenue, food & beverage services, and management fees. The company caters to corporate, leisure, and religious tourism segments and has presence in key markets including Gujarat, Maharashtra, Karnataka, and Dubai.
Company Analysis
from RHPSuba Hotels Limited is one of India's largest domestic hotel chains in the mid-market sector operating 88 operational hotels across upscale, upper-midscale, midscale, and economy segments through owned, managed, revenue share & lease, and franchised business models.
Suba Hotels Limited, incorporated in 1997 and converted to public limited company in 2023, operates a diverse portfolio of 88 operational hotels with 4,096 keys across over 50 cities in India, with approximately 81% located in tier 2 and 3 emerging markets. The company operates through multiple business models including owned hotels (5 hotels, 227 keys), managed hotels (19 hotels, 823 keys), revenue share & lease hotels (16 hotels, 577 keys), and franchised hotels including Choice Hotels brands (48 hotels, 2,469 keys). Revenue for FY 2025 was ₹7,924.32 lakhs from operations, with primary revenue streams from room revenue, food & beverage services, and management fees. The company caters to corporate, leisure, and religious tourism segments and has presence in key markets including Gujarat, Maharashtra, Karnataka, and Dubai.
hospitalityhotel operationsmid-market hotel segmenttourism
Objects of the Issue
- Funding Capital Expenditure Requirements towards upgradation and last-mile funding of hotel premises ₹5,347.56 lakhs p.30
- General Corporate Purposes p.30
- The Objects of the Offer are detailed in the chapter titled 'Objects of the Issue' on page 102 of this Red Herring Prospectus p.77
- Funding Capital Expenditure Requirements towards upgradation and last-mile funding of hotel premises ₹5,347.56 lakhs p.105
- General Corporate Purposes p.105
- Funding for Civil and Interior work for hotel premises situated at Pithampur p.170
- Renovation, Refurbishment and Modernization of hotel premises at Vadodara, Ahmedabad, Junagadh, Bhuj and Nashik p.170
- Funding for hotel premises which are on Revenue & Lease basis in Bangalore p.170
Issue Structure
- Total Issue
- Up to 67,99,200 Equity Shares of face value of ₹10 each aggregating up to ₹[●] lakhs
- Fresh Issue
- Up to 67,99,200 Equity Shares of face value of ₹10 each aggregating up to ₹[●] lakhs
- Offer for Sale
- Not Applicable
- Price Band
- ₹[●] per Equity Share (Floor Price) to ₹[●] per Equity Share (Cap Price)
- Face Value
- ₹10 per Equity Share
Business Model
The company generates revenue through multiple hotel operating models: (1) Owned hotels generating 22.08% of FY2025 revenue from room rates and ancillary services; (2) Revenue share and lease hotels contributing 45.63% through lease rent and revenue sharing arrangements; (3) Managed hotels contributing 2.41% through management fees; (4) Franchised hotels under Choice Hotels master franchise agreement contributing 9.97% through franchise fees and royalties. Additional revenue comes from food & beverage services, travel desk services, and car rental operations.
Business Segments
Hotels fully owned by the company generating revenue from room rentals, food & beverage services, and ancillary services
Hotels operated under lease or revenue sharing arrangements with third-party owners
Hotels owned by third parties and operated by Suba Hotels, generating revenue from management fees
Hotels operated by franchisees under Choice Hotels brands (Clarion, Quality, Comfort) with revenue from franchise fees and royalties
Hotel room operations across multiple hotel brands and business models including owned, managed, revenue share & lease, and franchised properties serving business, leisure, and religious tourism segments
Restaurant and food & beverage operations at 22 on-property restaurants serving both hotel guests and external customers, including banquet and MICE facilities
Revenue from rooms in owned hotels operated by the company
Revenue from rooms in hotels operated on revenue share and lease basis
Revenue from franchised hotels
Revenue from hotels managed by the company
Revenue from food and restaurant operations
Other revenue from operations
Hotels that are wholly owned and operated by the company
Hotels operated and managed by the company on behalf of third-party owners under management contracts
Hotels operated under revenue-sharing and lease agreements where the company finances renovations or leases the property and recovers investment through revenue sharing
Hotels operated by franchisees under the company's brands with the company receiving brand license fees and other recurring fees
Hotel operations across India in tier 2 and 3 cities
Hotel management operations in Dubai
Revenue from owned hotel properties
Revenue from hotels on revenue share and lease basis
Revenue from franchised hotel operations
Revenue from managed hotel properties
Revenue from food and beverage operations
Revenue from spa, outside catering and other services
SWOT Analysis
Strengths
- • One of India's largest domestic hotel chains in mid-market sector with significant operational scale(p.26)
- • Diversified portfolio across multiple hotel brands and business models(p.26)
- • Strong footprint in emerging markets and tier 2/3 cities with growth potential(p.26)
- • Multiple revenue streams across corporate, leisure and religious tourism segments(p.26)
- • Strong financial performance with consistent profit growth(p.32)
- • Leading domestic mid-scale hotel chain with 88 operational hotels across 4,096 keys(p.152)
- • 81% of properties in tier 2 and 3 emerging markets, untapped destinations(p.152)
- • Diversified business model reducing capital requirements(p.159)
- • Lowest gestation periods for owned hotel development(p.157)
- • Strong financial performance with revenue growth and improving margins(p.155)
- • Established distribution network with 30+ sales executives and pan-India partnerships(p.160)
- • Proven ability to acquire and revitalize underperforming hotel assets through renovation and rebranding(p.161)
- • Established distribution network and strategic OTA partnerships generating substantial online demand(p.161)
- • Demonstrated success in ARR improvement through operational excellence (87.50%-118.18% increases across case studies)(p.161)
- • Experienced promoter and management team with 30+ years in logistics and 14+ years in hospitality(p.162)
- • Choice Hotels Master Franchisee partnership providing access to brands, reservation systems and loyalty programs(p.167)
- • Diversified portfolio of 88 operational hotels across 7 brands with 4,158 rooms and 40 pre-opening hotels(p.166)
- • Strong revenue growth trajectory with 51.7% YoY increase (FY2025: ₹7,998.49L vs FY2024: ₹5,299.61L)(p.219)
- • Presence across Tier-1 and Tier-2/3 cities with geographic diversification (Gujarat 27.42%, Maharashtra 8.99%, Karnataka 12.10%, Dubai 12.63%)(p.164)
- • Extensive mid-market hotel portfolio across India with diversified business models(p.247)
- • Strong geographic expansion in underserved tier 2 and 3 markets with competitive positioning(p.247)
- • Diversified revenue model including owned, managed, revenue share/lease, and franchised hotels(p.247)
- • Strong revenue and profitability growth trajectory over three years(p.252)
- • Improved operating margins and EBITDA margin expansion(p.253)
- • Significant pre-opening pipeline with 40 hotels and 1,831 rooms ready for launch(p.247)
Weaknesses
- • High dependency on few hotels and concentrated geographic presence(p.44)
- • Heavy reliance on leased properties with renewal risks(p.39)
- • Significant revenue concentration in revenue share and lease model(p.37)
- • High proportion of bookings from OTAs creating commission dependency(p.41)
- • Substantial financial non-compliance regarding related party loans(p.41)
- • Audit qualifications and emphasis of matters regarding internal controls(p.46)
- • Unregistered charge on loan security creates regulatory risk and investor confidence concerns(p.49)
- • Significant debt burden with high interest rate exposure and restrictive debt covenants(p.49)
- • High and increasing receivables collection period creating working capital strain(p.52)
- • Multiple compliance failures and statutory non-compliance under Companies Act(p.52)
- • Outstanding litigation involving promoters and delays in statutory dues payment(p.53)
- • Conflicts of interest between promoters and group companies in same business line(p.54)
- • Delayed and unpaid statutory dues creating regulatory penalty risk(p.55)
- • Dependent on few customers with payment default risk, including Go Air(p.52)
- • High employee attrition rate of 35.87% indicating retention challenges(p.56)
- • Unable to locate historical corporate records for company incorporation(p.57)
- • Trademark applications pending without statutory protection as registered logos(p.63)
- • Lease arrangement for corporate office with no ownership, risking business disruption(p.58)
- • Contingent liabilities including bank guarantees could crystallize into actual liabilities(p.62)
- • Heavy debt burden with D/E ratio of 1.06(p.155)
- • Weak liquidity position with current ratio of 0.70(p.155)
- • Concentration of owned properties in a few states (Gujarat and Madhya Pradesh)(p.157)
- • Significant pre-opening portfolio not yet generating revenue(p.152)
- • High employee attrition rate at 35.87% in FY2024-25, exceeding typical hospitality industry benchmarks(p.175)
- • High short-term borrowings of ₹3,961.73L representing significant refinancing risk(p.218)
- • Significant dependence on related party transactions and group company arrangements(p.207)
- • Most operational hotels under franchise/lease/revenue-share models (83 of 88) rather than owned properties(p.174)
- • Heavy reliance on OTA channels (19.42% of revenue share hotels bookings from OTAs) creating commission dependency(p.165)
- • High debt burden with total borrowings increasing significantly(p.259)
- • Significant concentration of secured debt in few properties(p.225)
- • High reliance on related party borrowings with significant unsecured loans due on demand(p.237)
- • Material litigation involving promoters related to property disputes and fraud allegations(p.262)
- • Material tax disputes involving promoter with significant disputed amounts(p.266)
- • Negative working capital position affecting liquidity(p.240)
Opportunities
- • India's robust economic growth trajectory creating travel and tourism demand(p.26)
- • Significant pre-opening pipeline to drive future growth(p.26)
- • Expansion of capital base for property upgradation and last-mile funding(p.30)
- • Strategic master franchise agreement with Choice Hotels expanding brand portfolio(p.40)
- • Expansion to new geographies across India with focus on tier 1, tier 2 cities and tourist destinations(p.69)
- • Diverse hotel portfolio across multiple business models and brand categories(p.54)
- • Strategic use of IPO proceeds for capex and debt reduction to strengthen financial position(p.64)
- • Tier 2 and 3 city expansion with strong growth tailwinds(p.152)
- • Government focus on tourism with ₹2,541.06 crore budget allocation and 50 premier destinations initiative(p.152)
- • Rising domestic tourism with projected growth to 2510 million DTVs in 2024(p.139)
- • Expansion into unbranded segment representing 50% of total inventory(p.159)
- • Master franchisee position with Choice Hotels brands (Clarion, Quality, Comfort) enabling rapid expansion(p.158)
- • Airport connectivity expansion with 220 operational airports planned by 2030(p.137)
- • Government allocation of ₹2,400 crores to Ministry of Tourism and focus on 50 global tourism destinations(p.170)
- • Hotel room pipeline expected to grow at 3.5% CAGR from 2024-2027 with 52% of new Tier-2/3 keys opening by 2026-27(p.170)
- • Strategy to invest in last-mile funded hotel projects with flexible tenures and customizable repayment schedules(p.162)
- • Expansion opportunity in distressed hotel properties requiring renovation every 8-12 years with revenue-sharing model(p.162)
- • Large unbranded/independent hotel inventory (50% of total India rooms) in Tier-3+ cities presents consolidation opportunity(p.174)
- • Plan to enhance sales and marketing bandwidth through 8 additional employees and OTA team expansion(p.163)
- • Loyalty program implementation and partnership with Hotel Zify for SEO/digital presence enhancement(p.163)
- • Expansion into Tier-1 cities (Bangalore) operating under revenue-sharing model for strong business/medical tourism demand(p.171)
- • Government investment in tourism infrastructure and destination development(p.247)
- • Rapid expansion opportunities in tier 2 and 3 cities with underserved branded hotel market(p.247)
- • Growing branded hotel pipeline with strong signings momentum(p.247)
- • International expansion opportunity through UAE subsidiary with established operational presence(p.221)
- • Potential to monetize 40-hotel pre-opening pipeline for revenue growth(p.247)
Threats
- • Intense competition from multinational and domestic hotel chains(p.47)
- • Significant seasonal and cyclical revenue variations(p.48)
- • Dependence on franchise agreement terms with Choice Hotels(p.40)
- • Vulnerability to lease termination and property access disruptions(p.39)
- • Demand reduction from increased telepresence and virtual meeting technologies(p.38)
- • Fixed cost structure vulnerability during economic downturns(p.48)
- • Capital-intensive hospitality industry with unpredictable capital expenditure requirements(p.64)
- • Real estate asset liquidity risk and potential compulsory acquisition by government(p.55)
- • Manpower-intensive operations with risk of work stoppages and wage inflation(p.56)
- • Volatile interest rates and variable rate borrowings creating cost uncertainty(p.50)
- • COVID-19 pandemic adversely affected industry and future pandemic risk remains(p.71)
- • Occupancy and revenue dependent on changes in consumer behavior and economic conditions(p.57)
- • Food quality and hygiene incidents could result in contamination liability and reputational damage(p.57)
- • Natural disasters and man-made threats could disrupt operations and cause significant losses(p.73)
- • Copyright infringement risk from music playback in hotel common areas(p.60)
- • Global financial instability and macroeconomic slowdown could reduce travel demand(p.74)
- • Competition from large international hotel chains with significant scale(p.146)
- • High valuations in major cities limiting transaction opportunities(p.149)
- • Economic slowdown risk with global trade uncertainties impacting growth projections(p.126)
- • Seasonal and cyclical fluctuations in hospitality sector dependent on tourism demand(p.151)
- • Foreign exchange volatility affecting international tourists and operations(p.129)
- • Regulatory risks including licensing and compliance requirements(p.114)
- • Intense competition from large well-resourced domestic and international hotel chains with economies of scale(p.174)
- • Significant compliance burden from multiple environmental laws (Water, Air, Hazardous Waste, Plastic Waste Rules)(p.171)
- • Dependence on OTA commissions and digital platform partnerships for booking channels(p.163)
- • Exposure to foreign exchange and currency risk from Dubai operations (₹1,009.89L or 12.63% of FY2025 revenue)(p.164)
- • Industry cyclicality risk and dependence on tourism demand affected by economic cycles and external disruptions(p.162)
- • Critical dependence on information technology systems; failure could impair service delivery and damage reputation(p.175)
- • Regulatory risk from hotel classification, food safety, and multiple state-level licensing requirements(p.177)
- • Labor law compliance requirements and employee benefit obligations under multiple statutory acts(p.181)
- • Business seasonality affecting occupancy and revenue consistency(p.248)
- • Intense competition from established chains and new market entrants(p.248)
- • Risk of franchise and lease agreement non-renewal impacting revenue(p.248)
- • Dependence on discretionary tourism spending affected by economic cycles(p.248)
- • Regulatory risks including need to obtain and renew multiple licenses across locations(p.267)
Promoters
| Name | Role | Pre-Issue | Post-Issue |
|---|---|---|---|
| Click Hotels Private Limited | Promoter | 42.35% | — |
| Mansur Mehta | Promoter | 39.16% | — |
| Mubeen Mehta | Promoter | 1.59% | — |
| Mansur Mehta | Promoter | 39.16% | — |
| Mubeen Mehta | Promoter | 1.59% | — |
| Click Hotels Private Limited | Promoter | 42.35% | — |
| Shabnam Mehta | Promoter Group | 1.59% | — |
| Munshi Holding Co | Promoter Group | 15.31% | — |
| Click Hotels Private Limited | Promoter | 42.35% | — |
| Mansur Mehta | Promoter | 39.16% | — |
| Mubeen Mehta | Promoter | 1.59% | — |
| Shabnam Mehta | Promoter Group | 1.59% | — |
| Hajra Mehta | Promoter Group | Negligible | — |
| Rahima Mehta | Promoter Group | Negligible | — |
| Mansur Mehta | Promoter | 39.16% | — |
| Mubeen Mehta | Promoter | 1.59% | — |
| Click Hotels Private Limited | Promoter/Corporate Promoter | — | — |
| Mansur Abubaker Mehta | Promoter | 39.16% | — |
| Click Hotels Pvt Ltd | Promoter Group | 42.35% | — |
| Mubeen Mansur Mehta | Promoter | 1.59% | — |
| Munsi Holding Co. | Promoter Group | 15.31% | — |
Leadership
Mansur Mehta · Chairman and Managing Director
Mubeen Mehta · CEO
Girish Somnath Bhatt · CFO
Sonam Aggarwal · Company Secretary and Compliance Officer
Auto-extracted from the company's RHP using AI, with each fact linked to its source passage (hover any row to see the quote & page). Provided for research only, not investment advice — verify against the official RHP before relying on it.
Suba Hotels IPO FAQs
What is the lot size of Suba Hotels IPO?
The minimum lot size of Suba Hotels IPO is 1,200 shares. One lot costs ₹1,33,200 at the cut-off price.
When does Suba Hotels IPO open and close?
Suba Hotels IPO opened for subscription on 29 Sep 2025 and closed on 01 Oct 2025.
What is the listing date of Suba Hotels IPO?
Suba Hotels IPO listed on 07 Oct 2025.