Bhagwati Banquets plans Rs 100cr IPO

Ahmedabad-based Bhagwati Banquets & Hotels Limited (BBHL) is planning to go for an initial public offering (IPO) of around Rs 100 crore next year.

The Rs 25-crore company is raising funds worth approximately Rs 500 crore to set up six five-star hotels across India by 2020. A part of this fund-raising will be via the IPO route.

Addressing the media, Narendra Somani, chairman and managing director of Bhagwati Banquets & Hotels Limited, said, "We have already set up a hotel in Ahmedabad. Next year, we will be setting up a five-star hotel and a convention centre in Surat and will expand to cities like Hyderabad, Bangalore, Lucknow and Mumbai in future. We will be investing Rs 50 crore-Rs 80 crore in every hotel." By 2020, the company plans to have around 1,050 rooms under its banner.

Somani was in Hyderabad to announce the launch of its catering services in the city. This involves an initial investment of Rs 3 crore. BBHL is setting up a 5,500 sft centralised kitchen in the city and intends to have a capacity to serve 5,000 people per day. The company will be charging Rs 500 per person for its catering services.

BBHL is targeting a turnover of Rs 10 crore in the first year of its operations in Hyderabad and plans to grow by 20 per cent thereon. The total catering industry in Hyderabad and Secunderabad is estimated to be around Rs 500 crore with 3,000-odd caterers.

The company is also in parleys with corporates in the city to expand its business. Some of its clients in the country include Reliance Industries, Honda Motors, Wipro, Sony TV and Grasim Industries. BBHL will be expanding its catering business to Bangalore in the next three months.