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Strong Core Portfolio and New Keys to Drive Growth

JUNIPER delivered a healthy Q2FY27, with RevPAR growing 12.7% YoY, supported by an 8.6% increase in ARR to INR 11,514 and a 300-bps improvement in occupancy, reaching 75%. Growth across the existing portfolio was led by its flagship assets, with Grand Hyatt Mumbai (GHM) and Andaz recording 22% and 10% YoY room revenue growth, respectively. We anticipate growth will be driven by the company’s 2x room inventory by FY31E, targeting ~3,600 keys. Key additions include Westin Bengaluru Phase I (238 keys), followed by Phase II (275 keys), ~550-key New Delhi, 277-key Guwahati and 106- key Kaziranga projects. Further, the company is in advanced discussion to acquire two brownfield assets with potential to add ~600 keys. The INR-19.3 Bn capex plan through FY31E, expected to be funded through mix of debt and internal surplus, provides a visible runway for expansion.

Revenue In Line with CIE estimate, while Margin Trails

* Operating performance remained resilient, with occupancy at 75% (+300 bps YoY), ARR grew 8.6% YoY to INR 11,514, resulting in RevPAR of INR 8,636 (+12% YoY)

* Revenue grew 8.3% YoY to INR 2,495 Mn (in line with CIE estimate of INR 2,412 Mn)

* EBITDA margin came in at 33.2% (decline of 269 bps YoY) leading to flat YoY EBITDA of INR 828 Mn (missing CIE estimate of INR 886 Mn)

* PAT rose by 121% YoY to INR 372 Mn, beating CIE estimate by 11.7%, owing to lower finance cost

Novotel Imagicaa Acquisition to Drive Incremental Revenue Growth

The acquisition of Novotel Imagicaa for INR 2.5 Bn adds an operating 287-key leisure hotel in Khopoli, near Mumbai, at an attractive cost of INR 8.6 Mn per key. The property reported 62% occupancy and ARR of ~INR 9,600 in Q1FY27, providing an established revenue base. Its proximity to Imagicaa Theme and Water Parks, along with diversified leisure, social and MICE demand, is projected to support higher room and F&B revenue over time. We estimate incremental revenue of INR 357 Mn in FY28E and INR 567 Mn in FY29E.

View and Valuation

We lower our FY27E and FY28E PAT estimate by 3.3% and 5.5%, respectively, on account of higher depreciation and increased finance cost required to fund the 2x key expansion plan. We factor in a Revenue / Adj. EBITDA / PAT CAGR of 15.3% / 16.4% / 33.2%, respectively. We value JUNIPER at 11.0x (maintained) FY28E EV/Adj. EBITDA, arriving at a TP of INR 230 (retained). Our DCF-derived valuation of INR 230 per share provides a sanity check. We, therefore, assign an ‘ADD’ rating on the stock, with an upside of 10.6%

Key Risks:

Probable project approval delays and cost overruns, prolonged geopolitical disruption affecting travel demand and elevated input cost weighing on margin with new asset stabilisation.

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