EIHOTEL - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 20 Dec 25, 11:15 pm

Fundamental Rating: 3.9

📊 Core Financials

• Revenue & Profitability: PAT declined to 97.6 Cr. from 134 Cr., showing -15.8% quarterly profit variation.
• Margins: ROE at 17.5% and ROCE at 21.9% reflect strong efficiency and profitability.
• Debt Ratios: Debt-to-equity at 0.04 — virtually debt-free, ensuring financial resilience.
• Cash Flows: Dividend yield of 0.42% provides modest shareholder returns.

💹 Valuation Indicators

• P/E Ratio: 32.4 vs Industry PE of 34.1 — fairly valued compared to peers.
• P/B Ratio: Current Price 363 ₹ / Book Value 68.6 ₹ ≈ 5.3, premium valuation.
• PEG Ratio: 0.31 — attractive growth-adjusted valuation.
• Intrinsic Value: Supported by strong fundamentals, though current price is slightly stretched.

🏢 Business Model & Competitive Advantage

• Operates luxury hotels under Oberoi and Trident brands, with strong brand equity in hospitality.
• Competitive advantage lies in premium positioning, customer loyalty, and global recognition.
• Institutional sentiment positive: FII holdings increased (+0.01%), DII holdings increased (+0.39%).

📈 Technical & Entry Zone

• DMA 50: 379 ₹ | DMA 200: 380 ₹ — stock trading below averages, indicating weakness.
• RSI: 31.8 — oversold territory, potential rebound zone.
• MACD: -3.76 — bearish momentum persists.
• Entry Zone: Attractive near 330–350 ₹ for accumulation.
• Long-Term Holding: Strong candidate for long-term portfolio given brand strength and low debt.

✅ Positive

• Strong ROE (17.5%) and ROCE (21.9%).
• Debt-free balance sheet (Debt-to-equity 0.04).
• Institutional investors increased holdings (FII +0.01%, DII +0.39%).

⚠️ Limitation

• Quarterly PAT declined (-15.8%).
• P/B ratio of 5.3 indicates premium valuation.
• Dividend yield of 0.42% offers limited shareholder returns.

📉 Company Negative News

• PAT dropped from 134 Cr. to 97.6 Cr.
• Stock trading below DMA 50 and DMA 200, showing technical weakness.

📈 Company Positive News

• DII holdings increased (+0.39%), reflecting domestic institutional confidence.
• Strong brand presence in luxury hospitality sector.

🏭 Industry

• Industry PE at 34.1 — sector trades at premium valuations.
• Hospitality industry benefits from tourism recovery and rising domestic demand but faces cyclical risks.

🔎 Conclusion

EIHOTEL is a fundamentally strong hospitality company with excellent return ratios, low debt, and premium brand positioning. Despite short-term profit decline and stretched valuations, entry is attractive near 330–350 ₹. It remains a solid long-term holding given industry recovery and strong brand equity.