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Shares of Schloss Bangalore Ltd., the owner of Indian luxury hotel chain The Leela, gained 5% on Friday, September 12, after brokerage firm Ambit Institutional Equities initiated coverage on the stock.
Ambit has started coverage with a 'Buy' rating and a price target of ₹540 per share, implying a 31% upside from Thursday's close.
The brokerage sees Schloss Bangalore, backed by Brookfield, as a strong play on the continued buoyancy in India's luxury hospitality sector.
According to Ambit, The Leela brand enjoys a distinct positioning with best-in-city properties that generate about 40% higher revenue per room than peers. Its portfolio mainly caters to the top 1% of domestic and foreign travellers, who together account for a 47% share in
FY25.
Three key owned assets, Bengaluru, New Delhi, and Chennai, contributed 70% of FY25 income. With limited new supply in the luxury segment (5.5-6.5% CAGR) and no large-tracked pipeline, Ambit believes Leela is well-placed to sustain growth.
The brokerage underscored a lean balance sheet and industry-leading margins, which leave scope for inorganic expansion.
It also said that five of six owned pipeline assets are expected to become operational by FY28, aligning with rising foreign tourist arrivals, an area where Leela
has an established advantage.
Ambit forecasts a 17% revenue CAGR and 19% EBITDA CAGR over FY25-29, valuing Schloss at 22x one-year forward EV/EBITDA. Alongside Schloss (LEELA), SAMHI remains among its top sector picks.
On the financial front, Schloss Bangalore reported strong June quarter results, with revenue climbing 22% year-on-year to ₹93 crore. Net profit stood at ₹35 crore, while EBITDA rose 29% YoY to ₹44 crore. EBITDA margins expanded 260 basis points to 47.3%.
The stock, which debuted on June
2 at a 7% discount to its issue price, has since seen a recovery. Founded in March 2019, Schloss Bangalore owns, operates, manages, and develops hotels and resorts under The Leela brand, focusing on premium accommodations and personalised service rooted in Indian hospitality.
The stock was trading 2.46% higher at ₹421.05, extending gains of about 4% over the past five sessions.
Ambit has started coverage with a 'Buy' rating and a price target of ₹540 per share, implying a 31% upside from Thursday's close.
The brokerage sees Schloss Bangalore, backed by Brookfield, as a strong play on the continued buoyancy in India's luxury hospitality sector.
According to Ambit, The Leela brand enjoys a distinct positioning with best-in-city properties that generate about 40% higher revenue per room than peers. Its portfolio mainly caters to the top 1% of domestic and foreign travellers, who together account for a 47% share in
Three key owned assets, Bengaluru, New Delhi, and Chennai, contributed 70% of FY25 income. With limited new supply in the luxury segment (5.5-6.5% CAGR) and no large-tracked pipeline, Ambit believes Leela is well-placed to sustain growth.
The brokerage underscored a lean balance sheet and industry-leading margins, which leave scope for inorganic expansion.
It also said that five of six owned pipeline assets are expected to become operational by FY28, aligning with rising foreign tourist arrivals, an area where Leela
Ambit forecasts a 17% revenue CAGR and 19% EBITDA CAGR over FY25-29, valuing Schloss at 22x one-year forward EV/EBITDA. Alongside Schloss (LEELA), SAMHI remains among its top sector picks.
On the financial front, Schloss Bangalore reported strong June quarter results, with revenue climbing 22% year-on-year to ₹93 crore. Net profit stood at ₹35 crore, while EBITDA rose 29% YoY to ₹44 crore. EBITDA margins expanded 260 basis points to 47.3%.
The stock, which debuted on June
The stock was trading 2.46% higher at ₹421.05, extending gains of about 4% over the past five sessions.
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