Indian Hotels Company Limited (IHCL) is one of the blue-chip stoks in the portfolio of Rakesh Jhunjhunwala, the Billionaire investor. He holds 30,016,965 equity shares being about 2 per cent stake in the Company.
The Hotels chain has a portfolio of 221 hotels, including 53 under development globally across four continents, 12 countries and in over 100 locations. During the FY22, IHCL has raised Rs 4,000 crore, in which Rs 2,000 crore was by way of rights issue and an additional Rs 2,000 crore through QIP.
SMC Global Securities has recommended a buy of Indian Hoteld on the basis that it has strong occupancy level and balance sheet.
It pointed out that IHCL has emerged strongly from the impact of the pandemic and all-round improvement was seen during FY22. The company is focused on expanding its business through asset-light model and strengthened its balance sheet by reducing its debt, it was added.
SMC Global also emphasized that Indian Hotels is committed to achieve zero debt in the long term.
It was also stated that going forward, the growth momentum is expected to continue expanding portfolio along with improvement in the RevPAR and occupancy level and upswing in domestic demand and recovery in the international markets.
The target price of Indian Hotels is Rs 274 per share in 8 to 10 months’ time frame on a target P/BVx of 5.15x and FY23 BVPS of Rs 53.28. This constitutes an upside of 21% from the CMP of Rs 255.