Suba Hotels IPO Day 1: Will big bulls Mukul Agrawal and Ashish Kacholia drive demand as GMP stays modest?

Suba Hotels will launch its IPO for subscription on September 29, aiming to raise Rs 75.47 crore through a fresh issue of 67.99 lakh equity shares. The price band has been fixed between Rs 105 and Rs 111 per share. The issue will close on October 1, with share allotment scheduled for October 3 and listing expected on October 7 at NSE SME.

IPO details and GMP

Investors can apply in lots of 1,200 shares, translating into a minimum investment of Rs 2.66 lakh for retail participants. The IPO is seeing early interest in the grey market, with shares trading at a premium of Rs 6, or about 6% over the upper price band, indicating cautious optimism about listing gains.

Marquee anchor investors

Ahead of the issue opening, Suba Hotels raised Rs 21.29 crore from a set of anchor investors, including well-known market names like Mukul Agrawal, Sunil Singhania, and Ashish Kacholia. A total of 19.17 lakh equity shares were allotted at Rs 111 apiece, the upper end of the price band. The anchor participation provides some confidence in the IPO’s reception among institutional investors.

Company overview

Suba Hotels operates in the mid-market hospitality segment. As of July 2025, the chain manages 88 operational hotels comprising 4,096 rooms across 50 cities, with a strong presence in tier 2 and tier 3 towns.

The group has 40 more properties in the pre-opening pipeline, which will add 1,831 rooms. Its business model spans owned, managed, leased, and franchised hotels, giving it flexibility to scale.

The company has owned hotels in Gujarat and Madhya Pradesh, while its franchise and management contracts extend its footprint nationally. The ability to acquire underperforming hotels and revive them through renovation or rebranding has been one of its strengths.

Financial performance

The company has reported robust growth in recent years. Revenue rose 51% to Rs 79.98 crore in FY25, while profit after tax surged 69% to Rs 15.15 crore.

Objects of the IPO

Proceeds from the IPO will be used primarily to fund capital expenditure, including upgradation and last-mile funding of hotel premises, with Rs 53.48 crore earmarked for this purpose. The remainder will go towards general corporate needs.

Outlook

With solid anchor backing, expanding hotel capacity, and consistent financial performance, Suba Hotels is positioned to benefit from rising travel demand. The modest GMP suggests tempered expectations for day-one listing pop.

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