ICICI Securities analyst believe that the company is on track to clock in a 100% year-over-year increase in revenues at ₹800 crore for FY23 with an EBITDA margin of 50%.

The Lemon Tree Analyst: Adhidev Chattopadhyay at ICICI Securities maintained the ‘buy’ rating for the stock upgrading the price target from ₹125 to ₹132. The price target translates to an over 75% upside from the stock’s last closing price of ₹75.22.

The Lemon Tree Thesis: The brokerage firm said that while FY23 has been the year of recovery, the focus from FY24 will be on growth. The analyst noted that the company looks to add another 2,800 rooms by March 2025, of which ~74% will be through the asset-light management contract/franchise route. With this proposed expansion the company's operational keys will be over 11,000 by FY25.

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In the latest research note, ICICI Securities noted that the Aurika Mumbai Airport hotel’s opening in the second half of FY24 will be incremental to the company’s earnings. As per the firm, The Aurika, Mumbai Airport hotel is expected to see a soft opening in Oct 2023 and is expected to be a key driver for earnings from FY25. The firm said that post the hotel’s opening the company can focus on organic debt reduction.

The brokerage raised its revenue and EBITDA estimates for FY25E by 18% factoring in faster occupancy ramp-up for Aurika Mumbai Airport hotel.

Price Action: Shares of the company were down 1.66% to trade at ₹73.97 in the late hours of trading on Friday.

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