Fundamental analysis of EIH Ltd | Invest for 9 to 12 months for 25% upside

CMP : Rs. 164     Target : Rs. 206 Timeframe: 9 to 12 months

In this stock, if you park your money from today for 9 to 12 months you will get up to 25% return. Fundamental analysis of EIH Ltd | Invest for 9 to 12 months for 25% upside Here are the reasons to invest in this stock.

Reasons to Invest:

Face Value: Rs. 2

52 Week High / Low  231.50 / 102.10

Market Cap: Rs. 9659.20 Cr

EPS: Rs. 2.57

Price Earning Ratio: 65.87

Price to Book Ratio: 3.72

Dividend Yield: 0.53%

Indian Promoter’s Holding: 35.25%

DII’s Holding: 15.09%

FII’s Holding: 4.03%

  • EIH Limited is involved in hospitality and related services. The Company operates luxury hotels under the brand name Oberoi and five- star hotels under the brand “Trident”.
  • In addition, The Company operates Oberoi hotels in India, Indonesia, Dubai, Mauritius, Egypt even in Saudi Arabia, among others. Furthermore, It also operates printing press, Oberoi flight services, Oberoi airport services, luxury car hire and car leasing, and business aircraft charters.
  • The Company has a 100% equity interest in the six ‘The Oberoi Hotels’ located in Mumbai, New Delhi, Kolkata, Bengaluru, Udaipur, and Ranthambhore. The Oberoi Hotels and Resorts are luxury properties serving foreign and domestic business customers and high-end leisure travelers. The Oberoi Hotels are widely recognized as being among the leading hotels in the markets and several have been assigned five-star deluxe ratings, the highest available rating in India, by the Ministry of Tourism.
  • The Company also has equity interests in nine hotels that operate under the “Trident” name. Trident Hotels target business and leisure travelers to metropolitan and tier two cities in India who seek high-quality boarding, lodging, and business or recreational facilities at more affordable rates than the five-star deluxe segment.
  • The Oberoi Gir, a Luxury Jungle Resort spread over 50 acres, is located on the periphery of Gir National Park in Gujarat. The Resort, scheduled to open in the last quarter of 2019 will be managed by the Company and shall consist of 22 Luxury Tents.
  • The Company, through its wholly-owned subsidiary, will manage a Luxury Wildlife Resort on the edge of Maasai Mara National Reserve, Kenya. The accommodation will consist of 32 luxury tents, two restaurants, a bar and a spa. The project is in the planning phase and scheduled to open in the third quarter of 2019.
  • From April 1, 2018, the company is starting its Delhi Oberoi, for which it has spent approximately 600 crores on a renovation. The property is critical to the company’s revenue and profits. Its contributed around 15 percent of its annual revenue.

Valuation:

The company business strategy moves for continued emphasis on high-end, upscale accommodation through the existing ‘The Oberoi and Trident Hotels’. The selective expansion in both the five-star deluxe and five-star segments of the Indian hotel industry by participating in the development and management of new hotel properties in destinations. Thus we expect the stock to see a price target of Rs 206 in 9 to 12 months time frame on an expected P/Bvx of 4 and FY19 (BVPS) of Rs 51.4.

 

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Disclaimer:

My descriptions, videos, presentations are only for educational and information purposes and under no circumstances should be used for making investment decisions. I cannot guarantee the accuracy of any information provided.
The stocks picks are based on my own research and personal views and sometimes are from newspapers, tv channel program, magazines, etc. In addition, No part of compensation is or will be directly or indirectly related to the views and recommendations of this research. I have not served as an officer director or employee of the company and have not been engaged in the market – making the activity of the company covered in the research report. Hence Consult qualified financial advisor before making any investment decision.

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