From mint · Asit Manohar · · 1m
Jefferies India Buys Chalet Hotels Stock
Jefferies India targets 15% upside for Chalet Hotels despite negative YTD returns.
In brief
Jefferies India targets 15% upside for Chalet Hotels despite negative YTD returns. Jefferies India recommends buying Chalet Hotels shares at ₹965 target price after 7% YTD correction. Originally reported by mint.
Jefferies India stock pick
Jefferies India recommends buying Chalet Hotels shares with a target price of ₹965, up 15% against current market price of ₹834.90.
“We hosted Chalet's senior management for meetings in SG. Key takeaways include visibility on strong growth over the next 5 yrs, driven by its existing pipeline (~9-10% keys CAGR) & potential new adds/M&A.”
YTD correction
Chalet Hotels shares have delivered negative YTD returns after a 7% correction in the past year.
Growth pipeline
Chalet Hotels has a 2,036-key development pipeline including recent additions in Pune and Hyderabad.
5-year growth plan
Management aims to build Athiva into a leading pan-India premium hospitality brand with 1,200-1,500 keys.
Geographic expansion
Chalet Hotels plans to expand into Northern India with Taj Delhi Airport and Athiva South Goa.
Earnings stability
Chalet Hotels' commercial RE portfolio generates ~₹2.5-3bn annual EBITDA for stable earnings.
Risks highlighted
Jefferies warns of global economic slowdown, pandemic resurfacing, and downcycle impact on the 100% Asset Owner model.
What it means
Jefferies India recommends buying Chalet Hotels shares at ₹965 target price after 7% YTD correction.
