⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
ITCHOTELS - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.5
| Stock Code | ITCHOTELS | Market Cap | 37,153 Cr. | Current Price | 178 ₹ | High / Low | 262 ₹ |
| Stock P/E | 43.6 | Book Value | 54.6 ₹ | Dividend Yield | 0.00 % | ROCE | 9.74 % |
| ROE | 7.04 % | Face Value | 1.00 ₹ | DMA 50 | 195 ₹ | DMA 200 | 205 ₹ |
| Chg in FII Hold | -9.39 % | Chg in DII Hold | 0.92 % | PAT Qtr | 286 Cr. | PAT Prev Qtr | 152 Cr. |
| RSI | 35.5 | MACD | -5.02 | Volume | 20,61,531 | Avg Vol 1Wk | 33,36,769 |
| Low price | 158 ₹ | High price | 262 ₹ | Debt to equity | 0.01 | 52w Index | 19.8 % |
| Qtr Profit Var | 25.4 % | EPS | 3.90 ₹ | Industry PE | 32.6 |
📊 Core Financials
- Revenue & Profitability: PAT rose from 152 Cr. to 286 Cr. QoQ (+25.4%), showing strong earnings momentum.
- Margins: ROE at 7.04% and ROCE at 9.74% are modest, reflecting average efficiency and shareholder returns.
- Debt: Debt-to-equity ratio of 0.01 indicates a virtually debt-free balance sheet, ensuring financial stability.
- Cash Flow: Dividend yield of 0.00% suggests reinvestment focus, with no direct shareholder payout.
💹 Valuation Indicators
- P/E Ratio: 43.6 vs Industry PE of 32.6 → overvalued compared to peers.
- P/B Ratio: Current Price (178 ₹) / Book Value (54.6 ₹) ≈ 3.26, relatively expensive.
- PEG Ratio: Not available, limiting growth-adjusted valuation analysis.
- Intrinsic Value: Current price below DMA 50 (195 ₹) and DMA 200 (205 ₹), suggesting technical weakness and possible undervaluation entry zone.
🏦 Business Model & Competitive Advantage
- ITC Hotels operates in hospitality, focusing on premium and luxury segments under ITC Ltd.
- Competitive advantage lies in brand strength, diversified hospitality portfolio, and debt-free structure.
- Overall health is stable, but valuation multiples remain stretched relative to industry peers.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive entry between 160 ₹ – 170 ₹, near support levels.
- Long-Term Holding: Suitable for investors seeking exposure to hospitality growth, but monitor valuation and profitability trends.
✅ Positive
- Debt-free balance sheet (Debt-to-equity 0.01).
- Strong PAT growth (+25.4% QoQ).
- Brand strength in premium hospitality segment.
⚠️ Limitation
- High P/E (43.6) compared to industry average (32.6).
- ROE (7.04%) and ROCE (9.74%) remain modest.
- No dividend yield, limiting shareholder reward.
📉 Company Negative News
- FII holdings decreased significantly (-9.39%), showing reduced foreign investor confidence.
- Stock trading below DMA 50 and DMA 200 indicates bearish technicals.
📈 Company Positive News
- DII holdings increased (+0.92%), reflecting domestic institutional support.
- PAT surged from 152 Cr. to 286 Cr., showing strong operational performance.
🏭 Industry
- Industry PE at 32.6 is lower than ITC Hotels’ valuation, highlighting overpricing.
- Hospitality sector growth driven by tourism recovery and premium demand.
- Competition from established hotel chains remains strong.
🔎 Conclusion
- ITC Hotels shows strong earnings growth and debt-free stability, but valuation is stretched compared to peers.
- Entry near 160–170 ₹ offers better margin of safety.
- Best suited for long-term investors seeking hospitality exposure, with close monitoring of profitability and institutional investor trends.
I can also prepare a comparative HTML report of ITC Hotels versus other hospitality players like Indian Hotels and EIH to highlight relative valuation and growth prospects.