Buy Samhi Hotels Ltd For Target Rs. 201 by Prabhudas Liladhar Capital Ltd
Resilient RevPAR; margin pressures persist
We cut our EBITDA estimates by 3%/5% for FY27E/FY28E as we realign our margin assumptions, factoring in near-term ARR pressure arising from lower share of higherpaying international travellers and loss of input tax credit (ITC). Despite the Middle East conflict, SAMHI IN delivered a resilient operating performance, with same-store RevPAR growth of 9.6%, led by expansion in occupancy to 79.3%. Led by same-store revenue growth of ~9-11%, addition of ~170 keys at Hyderabad and incremental contribution from the asset-light RARE India platform, we expect revenue CAGR of 15% over FY26-FY28E, with EBITDA margin of 35.9%/37.8% in FY27E/FY28E, respectively. SAMHI IN trades at an attractive valuation of 12.3x/10.1x our FY27E/FY28E EBITDA estimates (adjusted for minority interest in the JV platform with GIC). We maintain BUY with a TP of INR201 (10.5x FY28E EBITDA; no change in target multiple).
Same store RevPAR increases 9.6% YoY:
Topline increased 12.1% YoY to INR3,052mn (PLe INR3,022mn). Same-store RevPAR grew 9.6% YoY to INR5,219 while occupancy stood at 79.3%.
EBITDA margin stood at 32.2%:
EBITDA increased 8.5% YoY to INR982mn (PLe INR991mn) with a margin of 32.2% (PLe 32.8%). PBT before exceptional items increased by 26.4% YoY to INR327mn (PLe INR288mn) with a margin of 10.7%. Divergence at the PBT level was on account of lower-than-expected depreciation and finance costs at INR309mn/INR377mn (PLe INR351mn/INR408mn) respectively. PAT after MI rose 5.6% YoY to INR183mn (PLe INR175mn) for the quarter with a margin of 6.0% (PLe 5.8%).
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