Multibagger Tata Stock Seen To Rise 15% Ahead After Q1; Ace Investor Rekha JhunJhunwala In For A Treat

Indian Hotels Company posted double-digit growth across key verticals in the June 2023 quarterly earnings for FY24. This led to a bullish tone in Tata stock on July 28, with the shares rising by around 2% on BSE. Not just the strong earnings, but also the company quarter ended with turnover crossing over Rs 1,500 crore mark, making it a historical Q1. Brokerage Axis Securities is optimistic about Indian Hotels' share price going forward and sees a nearly 15% upside.

On BSE, the company's share price ended at Rs 391.60 apiece, up by 1.71%. The stock was near its intraday high of Rs 393.75 apiece.

This Tata Group-backed stock is a multibagger with shares rising nearly 202% on the BSE in 5 years. So far in 2023, the stock has jumped by at least 23.5%. In a year, the upside is over 49%.

On July 27, the company reported its consolidated financials for the first quarter ending June 30th, 2023. In this Q1, the company's PAT zoomed by 31% YoY to Rs 222 crore, while EBITDA climbed by 13% YoY to Rs 459 crore. The top-line (revenue from operations) was robust with 17% YoY growth to Rs 1,516 crore.

In its financial results report, r. Puneet Chhatwal, Managing Director & CEO, of IHCL, said, "IHCL ended the first quarter with a strong performance led by double-digit revenue growth. Turnover crossed the Rs 1,500 crore mark, making it a historical Q1."

Should you buy Indian Hotels shares?

Axis Securities has recommended buying Indian Hotels stock for a target price of Rs 450 per share which has been raised from earlier Rs 385 per share.

This is a potential upside of nearly 30% in Indian Hotels shares going forward compared to the current market price.

Giving its rationale for the recommendation, Axis Securities in its note said, "Indian Hotels (IHCL) reported consolidated revenue growth of 16% YoY which stood in line with our expectations. This growth was majorly driven by an increase in RevPAR to Rs 6,126, (+13%YoY) in the domestic hotels while International Assets in the US and UK reported growth of 9% and 29% respectively." Also, the company posted EBITDA margins of 28%, down 186bps YoY due to an increase in
other expenses.

Hence, the brokerage's note said, "Current demand is led by strong domestic consumption patterns and supply constraints in key metropolitan areas. Domestic consumption patterns include leisure, weddings, conferences and other events. We expect increasing business travel and international tourists to further drive demand. Major events such as the G20 summit and World Cricket in India would fuel industry growth."

Also, Indian Hotels MD expects the outlook for upcoming quarters to remain strong with the pace of demand driven by domestic consumption momentum, global events, and the revival of international arrivals.

Among investors, late market mogul Rakesh Jhunjhunwala's wife Rekha will be in for a treat. Indian Hotels stock is among the top 10 most valued holdings of Rekha Jhunjhunwala.

As per the shareholding pattern, Rekha's shareholding in Indian Hotels is to the tune of 30,016,965 equity shares or 2.15 as of June 30, 2023. As per Trendlyne's report, her holding is valued at nearly Rs 1,176 crore by the end of the July 28, 2023, trading session.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns. in advises users to consult with certified experts before making any investment decision.