Moneycontrol
Apr 19, 2017 12:46 PM IST | Source: Moneycontrol.com

Buy East India Hotels; target of Rs 150: ICICI Direct

ICICI Direct is bullish on East India Hotels has recommended buy rating on the stock with a target price of Rs 150 in its research report dated April 13, 2017.

 
 
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ICICI Direct's report on East India Hotels


East India Hotels (EIH), one of the premium hotel operators, is expected to be a key beneficiary of a revival in the economic environment. We believe that a slowing down of capacity addition coupled with a rise in spending by domestic travellers will drive occupancy levels over the next few years. Also, with improved tourism measures by the government, the sector may see a better growth trajectory and pricing in the next three to four years.


Outlook


The stock is trading at attractive valuation of (i.e. at EV of Rs 3.2 crore/room, 15.0x FY19E EV/EBITDA). Hence, we upgrade the stock to BUY with a revised target price of Rs 150 (i.e. valuing at EV/EBITDA of 17.0x and EV of Rs 3.9 crore/room).


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