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Buy Indian Hotel; target of Rs 180: Motilal Oswal

Motilal Oswal is bullish on Indian Hotel recommended buy rating on the stock with a target price of Rs 180 in its research report dated July 07, 2021.

July 08, 2021 / 03:50 PM IST
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Motilal Oswal's research report on Indian Hotel

In FY18, management contract Hotels formed 32% of the overall portfolio, which has now increased to 46% (including Hotels in the pipeline). IH targets to take it to 50% going forward. About 78% of current pipeline Hotels are under management contracts. As per ‘Aspiration CY22’ announced in CY18, it looked to sign 15 Hotels under management contract annually. However, it added 22/29/17 Hotels in FY19/FY20/FY21. IH recorded the highest number of new Hotel signings and openings in the industry during CY20, with 17 signings and seven new Hotel openings. It generated a revenue of INR2.2b from management contracts, which it intends to take to INR3.5b. It is to be noted that EBITDA flow through in management contract income is 70-80% and that too without deploying capital, thus the said initiative is RoCE accretive.


We value the stock at 19x Jun’23E EV/EBITDA and arrive at a SoTP-based TP of INR180. We maintain our Buy rating.

For all recommendations report, click here

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on are their own, and not that of the website or its management. advises users to check with certified experts before taking any investment decisions.

Broker Research
first published: Jul 8, 2021 03:50 pm

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