Indian Hotels CMP 71 Target 95 Time Horizon - 12Months
Investment Rationale
~ Reclassifying of various hotel properties under four brands – TAJ, VIVANTA, THE GATEWAY and GINGER
~ Expansion plans – Capacities and Geographical Regions
~ Better Financial Performance – Q2 FY12 Results
~ The Turnaround
~ Better Industry Outlook – Tourist arrivals and growing domestic demand
Valuations
Improving domestic industry trends are aiding the company, with the major trigger for it being a turnaround in its US operations. With the improving situation, we expect it would clock a 16% rise in revenue in FY12 with the better bottom line reducing its debt burden. On improved performance we see a price target of Rs.95.
www.nangakaro.com
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