M Cap: Rs 5,537cr
Though the stock of the hospitality major has lost a little over 2 per cent with a large spurt in volumes last fortnight, analysts are bullish on the stock. Indiabulls Securities Research has maintained its hold rating on the stock. According to the brokerage, the DCF-based fair value estimate of Rs 88 provides an upside of 10.6 per cent to the current market price of Rs 79.9. “The stock has corrected significantly in the past few months and is trading close to its fair value:’ says the research report. Another brokerage house India Infoline has maintained its market performer rating on the stock with a reduced target price of Rs 85 in its August22 report. IHCL will expand room inventory by 24.3 per cent, excluding management contracts and Ginger hotels, supported by a capex spend of Rs 21 billion over FYO8-FY1 1 E. “Consequently, we expect the company to witness sales and earnings CAGR of 15.1 per cent and 26.6 percent over the next two years:’ states the report. According to the brokerage valuations are reasonable with PIE of 1 0.8x and EVIEBIDTA of 6.8x on FY 10Y earnings.
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