Shares of ITC Hotels have experienced a remarkable surge, climbing 11% in the latest trading session to reach an impressive all-time high. This surge comes amidst a positive wave in the Indian stock market, buoyed by optimistic global signals. As a newly listed entity following its split from the prominent FMCG giant ITC Ltd, the hotel brand is attracting significant investor interest, particularly as the summer holiday season approaches.
ITC Hotels Stock Performance
On Friday, ITC Hotels’ shares opened at ₹184 and soared to a peak of ₹204.45, marking a fresh 52-week high before closing at ₹198.50 on the BSE. This remarkable performance has propelled the company’s market capitalization to approximately ₹41,311.25 crore. Over the last five trading days, the stock has gained 15%, paralleling the upward momentum of key indices like the Nifty 50 and Sensex, which recently recorded their largest weekly gains in four years.
- Monthly Gain: 21%
- Year-to-Date Increase: 13%
- IPO Listing Price: ₹188 on BSE, ₹180 on NSE
Future Outlook for ITC Hotels
Industry analysts at ICICI Direct predict that the demerger of ITC Hotels will amplify shareholder value. They anticipate robust performance driven by favorable market conditions and a strategic asset-light growth approach. The brokerage has issued a ‘buy’ recommendation for ITC stock, setting a target price of ₹555, which suggests a 15% potential upside in the upcoming year.
According to ICICI Direct, “Post-demerger, ITC’s stock could see a price adjustment of ₹12-15 per share, enhancing its earning and return profile in the long run.” They also emphasize that the demerger will create significant value for shareholders, allowing for improved operational focus in the years to come.
Expert Opinions on ITC Hotels
Meanwhile, international brokerage Jefferies has begun coverage on ITC Hotels with a ‘Buy’ rating, projecting a target price of ₹240, indicating a 40% upside potential. They believe the current share price reflects a discount compared to its peers and expect this gap to narrow over time. Jefferies has forecasted an impressive growth rate for ITC Hotels, estimating 16% annual growth in EBITDA and 19% growth in PAT through FY24-27.
Expansion and Competitive Edge
As the second-largest publicly traded hotel chain in India, ITC Hotels operates with a robust owner-operator model. The company plans to ramp up its underutilized greenfield projects, which currently account for 20% of its total hotel keys.
Key highlights of ITC Hotels’ strategy include:
- Strategic Partnership: Collaborations with Marriott International, boosting its global presence.
- Expansion Goals: Plans to grow from 140 properties to over 200 hotels in five years.
- Occupancy Projections: Anticipated growth in occupancy from 69% in FY24 to 75% by FY27.
With a strong financial foundation and an ambitious expansion strategy, ITC Hotels is well-positioned to capitalize on the increasing demand in the hospitality sector. As travel trends rebound, both domestic and international, the company is likely to see significant growth in the coming years.
Overall, with its well-established brand and strategic initiatives, ITC Hotels is on a promising trajectory for long-term success in the competitive hospitality landscape.
