Indian Hotels shares decline 3% after Morgan Stanley downgrade, price target cut

Shares of Indian Hotels Company Ltd. declined nearly 3% on Wednesday, January 7, after brokerage firm Morgan Stanley downgraded its rating and cut its price target on the stock.

Morgan Stanley has downgraded the Indian Hotels stock to "equal weight" from its earlier rating of "overweight". The brokerage has also cut its price target on the stock to ₹780 per share from ₹811 apiece

earlier. The revised price target implies a potential upside of 7% from Tuesday's close.

The brokerage said by leveraging the Taj brand, the company has created a hospitality ecosystem that delivers industry-leading return ratios and free cash flow.

While the industry revenue per available room cycle is strong, it may see limited upside surprises, Morgan Stanley said.

Morgan Stanley said the enterprise value (EV) / earnings before interest tax depreciation and amortisation (EBITDA) of 27.5x for the financial year 2027, adequately captures the risk-reward.

InNovember 2025, Indian Hotels' managing director and CEO Puneet Chhatwal reaffirmed the firm's double-digit revenue growth guidance for FY26.

In a conversation with CNBC-TV18, he projected top-line growth of around 10% for the second half of this fiscal, bolstered by a strong food and beverage business and a higher number of weddings in comparison to the previous year.

Of the 26 analysts who have coverage on the stock, 18 have a "buy" rating, six have a "hold" rating and two have a "sell" rating.

Indian Hotels shares declined 3% to hit an intraday low of ₹703.3 apiece on Wednesday. The stock was down 2.4%at 708.8 apiece around 10.45 AM. Shares have declined 16.9% in the past year.

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