Sharekhan has given Buy recommendation for Indian Hotels Company with a target price of Rs. 182 in its research report issued on Jul 09, 2021
Sharekhan’s research report on Indian Hotels Company
Strong room inventory (across pyramid) and a relatively lean balance sheet will help IHCL be a key beneficiary of recovery in the hospitality space. IHCL is focusing on turning asset-light by adding rooms through management contracts and scaling up newer initiatives (Qmin & Ama) which can generate higher margins at a minimum capex. Company aims to reduce debt to pre-pandemic levels by hiving off non-core assets and generate better return on capital in the medium to long term. Stock is currently trading at 25x its FY2023E EV/EBIDTA. Any sustained improvement in occupancies and margins and reduction in debt would further aid re-rating of the stock.
We maintain a Buy on Indian Hotels Company (IHCL) with a revised price target of Rs. 182.