Company Profile
The parent company of The Leela Palaces, Hotels and Resorts, Schloss Bangalore Private Limited, is launching its Initial Public Offering (IPO) on May 26, 2025. The IPO plans to raise ₹3,500 crore, which includes:
- ₹2,500 crore from a fresh issue of shares
- ₹1,000 crore from an Offer for Sale (OFS) by current investor Brookfield
The price band has been set at ₹413–₹435 per share. The public subscription will be open from May 26 to May 28, and shares are expected to be listed on the BSE and NSE on June 2, 2025.
The company intends to use the proceeds to repay debt and strengthen its financial position.
Company Profile – The Leela Palaces, Hotels and Resorts
- Founded: 1986 by Captain C. P. Krishnan Nair
- Current Ownership: Brookfield Asset Management (since 2019)
- Headquarters: Mumbai, India
- Properties: 13 luxury hotels across India, including in:
- New Delhi
- Bengaluru
- Udaipur
- Chennai
- Jaipur
- Mumbai
- Gandhinagar
The Leela brand is known for luxury hospitality, offering premium accommodations, gourmet dining, and high-end wellness services. The brand has received multiple global accolades and is considered one of India’s most prestigious hotel chains.
In FY24, the company reported revenue of ₹1,226 crore, showing a strong recovery from the pandemic period.
Business Model
1. Luxury Hospitality Services
- Offers high-end accommodations with palatial architecture, luxury amenities, and personalized service.
- Targets affluent domestic and international travelers, corporate executives, celebrities, and dignitaries.
2. Revenue Streams
- Room Revenue: Premium pricing for rooms and suites at iconic properties.
- Food & Beverage (F&B): Signature restaurants, bars, and banquet services.
- Events & Conferences: High-end weddings, corporate events, and MICE (Meetings, Incentives, Conferences, and Exhibitions).
- Spa and Wellness: Premium spa treatments, yoga retreats, and wellness programs.
- Retail and Branded Experiences: Curated luxury experiences, including collaborations with fashion and lifestyle brands.
3. Asset Strategy
- Mixed Ownership Model:
- Some properties are owned and operated directly.
- Others are managed under long-term management contracts.
- Leverages partnerships and Brookfield’s global real estate portfolio to expand its footprint.
4. Brand Positioning
- Positioned as a premium Indian luxury brand, combining traditional Indian hospitality with world-class standards.
- Competes with international chains like Taj, Oberoi, Marriott, and Hyatt in the ultra-luxury space.
5. Expansion & Growth
- Focus on tier-1 cities, tourist hubs, and business centers.
- Planned expansions into international markets and premium leisure destinations.
- Strategic use of IPO proceeds to reduce debt and enable future growth.
6. Digital & Customer Engagement
- Uses a robust digital platform for direct bookings, loyalty programs, and guest personalization.
- Focused on high customer retention, with emphasis on repeat business from corporate clients and premium travelers.
Product Portfolio
1. Luxury Accommodations
- Room Categories:
- Deluxe Rooms
- Premier Rooms
- Club Rooms (with lounge access and personalized services)
- Royal Suites and Presidential Suites
- Known for elegant interiors, heritage design, and panoramic views in key locations.
2. Fine Dining and Culinary Experiences
- Signature Restaurants:
- Indian, European, Pan-Asian, and international cuisine offerings.
- Michelin-star-inspired menus and celebrity chef collaborations at select properties.
- Bars & Lounges:
- Premium wine collections, rare whiskies, and handcrafted cocktails.
- In-room Dining:
- 24/7 gourmet room service with curated menus tailored to each hotel’s theme.
3. Spa and Wellness
- ESPA at The Leela (in select properties): Full-service luxury spa brand partnership.
- Wellness Services:
- Ayurvedic therapies
- Yoga and meditation sessions
- Fitness centers with modern equipment and personal trainers
- Wellness retreats are available at select leisure properties.
4. Events, Weddings & Conferences
- Banquet Halls & Ballrooms:
- Large-format venues for destination weddings, galas, and social functions.
- Business Facilities:
- Conference rooms, boardrooms, and MICE (Meetings, Incentives, Conferences, Exhibitions) infrastructure.
- Wedding Planning Services:
- Custom decor, gourmet catering, and bridal concierge services.
5. Curated Guest Experiences
- Cultural Programs:
- Live classical music, dance performances, and heritage tours.
- Luxury Transfers:
- Chauffeured limousines, vintage cars, and luxury airport transfers.
- Concierge Services:
- Personal shopping, bespoke itineraries, and city experiences.
6. Branded Residences & Long-Stay Options (Emerging Segment)
- Some properties are exploring branded serviced residences for long-stay luxury travelers or business professionals.
7. Loyalty & Membership Programs
- The Leela DISCOVERY:
- Part of the Global Hotel Alliance (GHA)
- Offers member-only perks, upgrades, and exclusive experiences across partner hotels worldwide.
Financial Snapshot (as of March 31, 2024)
📊 Financial Highlights (₹ in Crores)
| Metric | FY 2024 |
|---|---|
| Revenue | ₹1,171.45 crore |
| Net Profit / (Loss) | ₹(2.13) crore |
| EBITDA Margin | 48.9% |
| Occupancy Rate | ~67% |
| Average Room Rate (ARR) | ₹20,966 |
| Revenue per Available Room (RevPAR) | ₹9,592 |
| Debt-to-Equity Ratio | 1.55 |
| Return on Net Worth (RONW) | Not Applicable |
| Earnings Per Share (EPS) | ₹(0.12) |
| Net Asset Value (NAV) | ₹(160.57) |
📈 Key Financial Ratios
| Ratio | FY 2024 | Remarks |
|---|
| EBITDA Margin | 48.9% | Strong operating margin indicates efficient cost control and premium pricing. |
| Net Profit Margin | -0.18% | Marginal net loss; improved significantly from previous year’s loss margin. |
| Debt-to-Equity Ratio | 1.55 | Indicates a moderately leveraged capital structure. |
| Current Ratio | ~0.9 (est.) | Slightly below 1, suggesting tighter short-term liquidity. |
| Return on Net Worth (RONW) | Not Applicable | Net worth remains negative; hence return not meaningful. |
| Earnings Per Share (EPS) | ₹(0.12) | Negative due to small net loss in FY 2024. |
| Net Asset Value (NAV) per Share | ₹(160.57) | Negative NAV reflects accumulated losses and past debt load. |
| Interest Coverage Ratio | ~1.4× (est.) | Operational earnings cover interest expenses; improved versus FY 2023. |
| Occupancy Rate | ~67% | Industry-aligned, shows stable room utilization. |
| Average Room Rate (ARR) | ₹20,966 | Reflects strong pricing power in the luxury segment. |
| RevPAR (Revenue per Available Room) | ₹9,592 | Up from FY 2023, reflecting improved operational efficiency. |
Initial Public Offering (IPO) Plans
| Component | Details |
|---|---|
| Issue Size | ₹3,500 crore |
| Fresh Issue | ₹2,500 crore |
| Offer for Sale (OFS) | ₹1,000 crore (by Brookfield) |
| Price Band | ₹413 – ₹435 per share |
| IPO Open Dates | May 26 – May 28, 2025 |
| Anchor Investor Date | May 23, 2025 |
| Expected Listing Date | June 2, 2025 (BSE and NSE) |
| Valuation | Approx. ₹14,500 crore at upper price band |
💼 Use of IPO Proceeds
- Repayment of Debt: A major portion will go toward reducing existing borrowings.
- General Corporate Purposes: To support operations and future expansion.
- Strengthen Balance Sheet: Improve leverage and credit profile.
Objectives of the Issue
1. Repayment or Prepayment of Outstanding Debt
- A significant portion of the net proceeds will be used to reduce existing borrowings.
- This will help:
- Lower interest expenses
- Improve the company’s debt-to-equity ratio
- Strengthen the overall balance sheet
2. Funding General Corporate Purposes
- This includes:
- Operational flexibility
- Brand and marketing initiatives
- Technology upgrades
- Expansion planning and working capital support
3. Enhancing Financial Profile
- By reducing debt and improving liquidity, the company aims to:
- Boost creditworthiness
- Enhance investor confidence
- Position itself for future expansion in India’s luxury hospitality segment
4. Providing Partial Exit for Existing Shareholder (Brookfield)
- The Offer for Sale (OFS) of ₹1,000 crore will allow Brookfield Asset Management to partially monetize its investment, increasing public float and investor access.
Future Outlook
1. Expansion and Growth
- The company plans to open several new luxury hotels in key cities across India over the next few years, including emerging destinations such as Agra, Srinagar, and Hyderabad.
- It also intends to enter the branded residences segment, offering luxury serviced apartments to capitalize on rising demand for premium living experiences.
2. Improving Financial Performance
- Revenues and operating margins have been steadily improving, reflecting strong demand recovery post-pandemic.
- The company aims to use IPO proceeds to reduce debt, which will strengthen the balance sheet and lower interest costs.
- Enhanced financial stability will provide the flexibility to invest in further growth initiatives.
3. Favorable Market Environment
- India’s hospitality industry is expected to grow rapidly, supported by rising domestic and international tourism.
- The luxury hotel segment is anticipated to grow faster than other categories, presenting an opportunity for The Leela to capture a larger market share.
- Increasing preference for luxury travel and premium hospitality services positions the company well to benefit from these trends.
4. Strategic Positioning
- Backed by a strong brand and global investor support, The Leela is well placed to leverage its legacy and expand its footprint.
- Continued focus on enhancing guest experience, service quality, and operational efficiency will help sustain competitive advantage.
🧭 Vision and Leadership
Vision
To be India’s premier luxury hospitality brand recognized globally for exceptional guest experiences, world-class service, and sustainable growth. The Leela Hotels aims to blend Indian heritage with modern luxury, creating iconic destinations that delight discerning travelers.
Leadership
- Captain C. P. Krishnan Nair (Founder)
The visionary behind The Leela brand, Captain Nair established the company in 1986 with a passion for creating world-class Indian luxury hotels that combine elegance, culture, and warm hospitality. - Brookfield Asset Management (Current Owner)
Since acquiring the company in 2019, Brookfield has brought global expertise and capital to support The Leela’s expansion and modernization efforts, strengthening its position in the competitive luxury hospitality market. - Executive Management Team
Led by experienced professionals from the hospitality and real estate sectors, the management team focuses on strategic growth, operational excellence, and delivering outstanding guest experiences while ensuring sustainable business practices.
Core Leadership Values
- Commitment to quality and guest satisfaction
- Innovation balanced with respect for Indian culture and tradition
- Sustainable and responsible growth
- Empowerment of employees and nurturing talent
Market Positioning and Growth Prospects
📍 Market Positioning
- The Leela Hotels is recognized as a premium luxury brand in India’s hospitality sector, known for combining elegant design, impeccable service, and a deep connection to Indian culture and heritage.
- The company operates in strategic locations across key cities, serving both business and leisure travelers from India and abroad.
- Revenue comes from a mix of sources including room stays, fine dining, events, and branded residences, creating a diversified and stable business model.
📈 Growth Prospects
- Schloss Bangalore plans to expand its portfolio by adding several new luxury properties by 2028, increasing its footprint and market presence.
- The company is also entering the branded serviced residences segment, catering to rising demand for premium, hotel-managed living spaces.
- Continuous upgrades and refurbishments of existing hotels will improve guest experience and operational efficiency.
- The Indian hospitality sector, especially the luxury segment, is expected to grow robustly, driven by increasing domestic tourism and international arrivals, providing a favorable environment for The Leela’s growth.
