Stock in Indian Hotels Co (IHCL) slipped nearly 5.5 per cent to 66.35 a share on Friday, after the Tata Group-owned company announced its unsolicited bid for luxury hotel chain Orient-Express.

On Thursday, IHCL announced that had placed $1.87-billion, or$12.63 per share, offer for acquiring the remaining 93 per cent stake in Orient-Express. The offer price represents a 40 per cent premium to Orient-Express Hotels' closing stock price on Wednesday.

The announcement worried IHCL shareholders that the company's financial heath will worsen if its ends up acquiring the New York Stock Exchange-listed luxury hotel chain.

IHCL is already burdened with a debt pile of around 3,000 crore, and investors believe that buying loss-making Orient-Express could increase the debt burden further.

Rashesh Shah, an analyst with ICICI, said, "If the deal goes through, it will strain Indian Hotels' profitability. Orient Express' financial performance has not been good; it had a loss of 410 crore in 2011."

Shah added that high debt and low profitability could keep the view negative for the coming 2-3 years.

However, brokers IHCL says that concerns over poor returns from the acquisition could continue for a year or two, but the deal will be positive in the long term.