A hospitality venture operating in South India has filed draft papers with the capital markets regulator to raise ?900 crore through an initial public offering (IPO). The proposed IPO will consist entirely of a fresh issue of equity shares, with no offer-for-sale component, according to the draft prospectus.

Of the total proceeds, ?481 crore will be used for debt repayment, while ?412 crore will be allocated to the company and ?69 crore to one of its material subsidiaries. The firm may also raise up to ?180 crore through a pre-IPO placement, in which case the overall issue size would be reduced.

The hospitality venture is a wholly owned subsidiary of a large real estate developer that entered the hospitality sector in 2004 and launched its first hotel in 2009. It currently operates a portfolio of nine hotels across multiple cities in India, offering a total of 1,604 rooms.

The hotels are run by several well-known international hospitality operators. The public issue is being managed by two lead book-running merchant banks.

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