Hotels, Restaurants & Tourism share price target

As per our channel checks and commentary from listed hotel companies, hotels continue to follow a strategy of keeping rates higher and sacrifice a bit of occupancy in preparation for a strong potential demand surge in H2FY23.

As per HVS Anarock, industry occupancies fell below 50% in Jan’22 owing to Omicron impact before recovering to ~55% in Feb’22 and 61% in Mar’22.

As per HVS Anarock, industry occupancies fell below 50% in Jan’22 owing to Omicron impact before recovering to ~55% in Feb’22 and 61% in Mar’22.

As per HVS Anarock, industry occupancies fell below 50% in Jan’22 owing to Omicron impact before recovering to ~55% in Feb’22 and 61% in Mar’22.

As per HVS Anarock, industry occupancies fell below 50% in Jan’22 owing to
Omicron impact before recovering to ~55% in Feb’22 and 61% in Mar’22. This momentum carried forward into Apr’22 with industry level occupancies reaching ~65% (same as Apr’19) pre-Covid levels and Apr’22 RevPAR at Rs3,803 or 103% of Apr’19 levels.

In our coverage universe, Indian Hotels and EIH both are best placed on the b/s front. The fund raising of | 4000 crore and | 350 crore by IHCL and EIH, respectively, has strengthened their b/s further. This would help them to further gain the market share. Lemon Tree Hotels, being on a capex mode,...

In our coverage universe, EIH is the best placed on the b/s front. The fund raising of | 350 crore thorough rights issue has improved debt/equity mix to 0.1x from 0.2x. While Indian Hotels' debt/equity is 0.7x, the proposed rights issue of | 3000 crore and strong promoter backing will take care of their liquidity requirements to fund ongoing business operations and capex. Lemon Tree Hotels, being on a capex mode is highly levered vs peers but also has strong institutional backing for liquidity support....