Weak First Day Demand
Elevate Campuses First Day IPO Sees Weak Demand Amid High Debt Concerns
Anonymous
Elevate Campuses’ ₹2,100 crore IPO was subscribed 0.20 times on its first day, with bids for 67.94 lakh shares against 3.36 crore shares on offer; the issue closes on September 25, 2026, at a price band of ₹343–₹362 per share and a 41-share lot size. The entirely fresh issue will fund acquisitions of K-12 entities and campuses from promoter-group companies, repay or prepay ₹750 crore of borrowings, and support general corporate purposes and future acquisitions. The company operates student accommodation and K-12 education assets under the Good Host Spaces and ScholarZ brands, with capacity for 80,255 students across 15 Indian cities and Dubai, including 20,368 owned beds and 55,487 managed beds. Revenue and profitability have grown strongly, supported by portfolio expansion, fee increases and ancillary services, but analysts have raised concerns about high leverage, related-party acquisitions, customer concentration and one-off gains that inflated FY26 profit. Net debt stood at ₹2,712.9 crore, with reported net debt-to-EBITDA of 4.98 times, rising to 6.23 times excluding the exceptional gain; Anand Rathi recommended subscribing for the long term despite calling the issue fully priced, while SBI Securities and other analysts urged caution or a neutral stance.
Key Points
1
Elevate Campuses allocated 2.61 crore shares to anchor investors at ₹362 apiece before the IPO opened; domestic mutual funds received 63.49% of the anchor allocation through 24 schemes.
2
Analysts said future expansion is expected to include 2,128 additional beds at IIT Madras and UPES Dehradun, alongside growth in the asset-light managed portfolio and consolidation of 16 domestic K-12 assets.
3
The company’s existing-campus growth is supported by annual fee increases of about 5–6% and ancillary offerings such as laundry, gyms and food outlets, which have helped produce same-campus growth of roughly 8–10%.
4
On a pro forma basis assuming the proposed acquisitions had already been completed, FY26 revenue was ₹806.9 crore and adjusted EBITDA was ₹657.2 crore, implying a 77.6% EBITDA margin for the enlarged group.
5
The IPO is being described as India’s first listed student-housing REIT-type platform; the business is ultimately controlled by funds of Hillhouse Investment, whose real-assets arm Rava Partners has committed more than $3.5 billion across Asian real-asset sectors since 2020.
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