Hotel Forest Inn Limited has officially opened its Initial Public Offering (IPO) for the general public starting today, Magh 22, 2082, marking a significant step in the company’s journey toward becoming a publicly listed hospitality enterprise in Nepal. The company is issuing a total of 33,20,000 ordinary shares at a par value of Rs. 100 per unit, aiming to mobilize capital from public investors to support its long-term growth plans. The IPO will remain open until Magh 26, 2082, as the early closing date; however, if the issue is not fully subscribed within this period, the closing date will be extended up to Falgun 8, 2082.
IPO Structure and Public Share Allocation
Hotel Forest Inn Limited has an issued capital of Rs. 2 Arba, out of which 20 percent, equivalent to 40,00,000 unit shares, has been earmarked for public issuance. Before the opening of the IPO for the general public, 10 percent of the public issue, totaling 4,00,000 units, had already been allocated to Nepalese citizens working abroad under the foreign employment quota. This initiative reflects the company’s effort to ensure inclusive participation by non-resident Nepalese in domestic investment opportunities.
From the remaining public issue, 2 percent, or 80,000 unit shares, have been reserved for the company’s employees, recognizing their contribution and encouraging internal ownership. Additionally, 5 percent of the total offered shares, amounting to 2,00,000 units, have been set aside for mutual funds to promote institutional participation in the offering. After accounting for these reserved categories, the remaining 33,20,000 unit shares have been made available to the general public starting today.
Issue Management and Application Details
NIC Asia Capital Limited has been appointed as the issue manager for the IPO. Investors can apply for a minimum of 10 units and a maximum of 2,00,000 units, allowing participation from both small retail investors and larger applicants. The application process follows standard regulatory guidelines set by the Securities Board of Nepal (SEBON), and investors are advised to carefully review the company’s prospectus before applying.
Credit Rating and Financial Assessment
CARE Ratings Nepal Limited (CRNL) has assigned a ‘CARE-NP BB-’ rating to the long-term bank facilities of Hotel Forest Inn Private Limited. This rating indicates a moderate degree of risk regarding the timely servicing of financial obligations. While the rating does not fall under the investment-grade category, it provides investors with an independent assessment of the company’s credit profile and financial commitments, which is particularly relevant given the capital-intensive nature of the hospitality industry.
Company Background and Project Overview
Hotel Forest Inn Private Limited was incorporated on November 22, 2010, to develop and operate a premium hotel property in Kathmandu. The company is currently constructing a hotel in Budhanilkantha, one of the capital’s rapidly developing and scenic locations. The project spans an area of 142,783 square feet, offering ample space for a modern hospitality complex designed to cater to both domestic and international guests.
The hotel will feature a total of 102 room keys and is proposed to be categorized as a five-star hotel property, positioning it in the upper segment of Nepal’s hospitality market. The project aims to tap into the growing demand for quality accommodation driven by increasing tourist arrivals, business travel, and international events in Kathmandu.
International Brand Partnership and Operations Plan
To strengthen its market positioning and operational standards, Hotel Forest Inn has entered into a ‘License Agreement’ with the InterContinental Hotels Group (IHG) for the use of the internationally recognized brand ‘Holiday Inn.’ Holiday Inn is an American-based mid-scale hotel chain known globally for standardized service quality and strong brand recognition. This partnership is expected to enhance the hotel’s visibility, operational efficiency, and ability to attract international guests.
The hotel is expected to commence operations in October 2023, subject to the completion of construction and regulatory approvals. Once operational, the project is anticipated to contribute to employment generation, tourism development, and overall economic activity in the Budhanilkantha area.
Outlook for Investors
With the opening of its IPO, Hotel Forest Inn Limited is offering investors an opportunity to participate in Nepal’s growing hospitality sector. While the industry carries inherent risks linked to tourism cycles and capital requirements, the company’s strategic location, international brand affiliation, and planned five-star positioning present notable growth prospects. Investors are encouraged to assess their risk appetite and investment objectives before participating in the issue.
