Hotel Forest Inn Limited (HFIN) is set to open its Initial Public Offering (IPO) to the general public from 22nd Magh, 2082, marking an important milestone for the hospitality sector’s participation in Nepal’s capital market. The company will issue 33,20,000 unit shares at a par value of Rs. 100 per share, aiming to raise Rs. 332 million from public investors.
According to the company, the IPO will close early on 26th Magh, 2082 if it is fully subscribed within that period. However, in case of under-subscription, the issue deadline will be extended until 8th Falgun, 2082.
Capital Structure and Share Allocation
Hotel Forest Inn Limited has an issued capital of Rs. 2 Arba (Rs. 2 billion). Of this, 20 percent, equivalent to 40,00,000 unit shares, is being offered to the public. Before the general public issuance, 10 percent of these public shares, amounting to 4,00,000 units, have already been allotted to Nepalese citizens working abroad under the migrant workers’ quota.
From the remaining public issue, 2 percent (80,000 units) have been reserved for the company’s employees, while 5 percent (2,00,000 units) have been allocated for mutual funds. The balance 33,20,000 units will be available for the general public starting from the IPO opening date.
Issue Management and Application Details
NIC Asia Capital Limited has been appointed as the issue manager for the IPO. Interested investors can apply for a minimum of 10 units and a maximum of 2,00,000 units through the ASBA system via their respective banks and financial institutions or the MeroShare platform.
Credit Rating Indicates Moderate Risk
CARE Ratings Nepal Limited (CRNL) has reaffirmed the issuer rating of ‘CARE-NP BB- (Is)’ assigned to Hotel Forest Inn Limited. This rating indicates a moderate risk of default regarding the timely servicing of financial obligations within the Nepali context.
The rating reflects the company’s exposure to operational stabilization risks following the commencement of hotel operations, the long gestation period typical of the hospitality industry, intense competition in Kathmandu’s hotel market, geographic concentration risk, and sensitivity to volatile interest rates. However, the rating is supported by the company’s experienced management team, strategic location, association with a reputed international hotel brand, and supportive government policies for the tourism sector.
Project Background and Funding Structure
Hotel Forest Inn Private Limited was incorporated on November 22, 2010, and later converted into a public limited company on August 28, 2023. The Hotel Forest Inn Limited has developed a greenfield five-star hotel project in Budhanilkantha, Kathmandu, spread over 142,783 square feet of land.
The total project cost stands at approximately Rs. 3,572 million, which has been financed through a combination of debt and equity. Of the total cost, Rs. 2,120 million has been funded through bank loans, while the remaining amount has been met through equity. Promoters have already injected Rs. 1,020 million, and the balance Rs. 980 million is planned to be raised through the IPO, subject to regulatory approvals.
Due to the debt-heavy funding structure, the company’s capital structure is expected to remain leveraged during the initial phase of operations, a factor that has been highlighted in the credit rating assessment.
Five-Star Hotel with International Branding
Hotel Forest Inn Limited operates a five-star hotel featuring 105 rooms, equipped with modern amenities including food and beverage services, a swimming pool, conference and banquet halls, spa facilities, and other premium services. The hotel commenced operations in mid-July 2024 and is currently in the stabilization phase.
A key strength of the project is its license agreement with InterContinental Hotels Group (IHG) for the internationally renowned ‘Holiday Inn’ brand. Holiday Inn is an American-based mid-scale hotel chain with a global footprint of over 1,200 hotels and a strong reservation and marketing network.
Under the agreement, IHG provides technical assistance, operational supervision, professional training, reservation systems, marketing support, and brand standards implementation. This association is expected to enhance the hotel’s visibility, improve occupancy rates, and support long-term operational efficiency.
Strategic Location Advantage
The hotel enjoys a strategic location in Budhanilkantha, Kathmandu, approximately 11 kilometers from Tribhuvan International Airport. Kathmandu remains Nepal’s primary gateway for international tourists and one of the country’s most prominent tourism hubs, home to seven UNESCO World Heritage Sites, historic Durbar Squares, and proximity to popular destinations such as Nagarkot, known for its Himalayan views.
This locational advantage is expected to support steady demand from international tourists, domestic travelers, business visitors, and the growing MICE (Meetings, Incentives, Conferences, and Exhibitions) segment.
Industry Outlook and Growth Prospects
Nepal’s tourism sector continues to receive strong policy support from the government. In the national budget for FY 2024/25, the government allocated Rs. 11.91 billion to the Ministry of Culture, Tourism, and Civil Aviation. Furthermore, the government has declared 2023–2033 as the “Tourism Decade”, aiming to position Nepal as a leading global tourism destination.
The hospitality sector’s recovery has been driven not only by the rise in foreign tourist arrivals but also by increasing domestic demand for leisure travel, social events, weddings, and business travel. Indicators such as occupancy rates, average room rates, and revenue per available room have shown steady improvement, reflecting the sector’s resilience despite global economic uncertainties.
About the Company
Hotel Forest Inn Limited (HFIN) is currently operating a five-star hotel in Budhanilkantha, Kathmandu. With experienced leadership, international brand affiliation, and a favorable industry outlook, the company aims to strengthen its market position while offering the investing public an opportunity to participate in Nepal’s growing hospitality sector through its upcoming IPO.
