Buy Lemon Tree Hotels, target Rs 93: Nirmal Bang Institutional Equities

INSUBCONTINENT EXCLUSIVE:
Lemin Tree Hotels share price: Buy Lemon Tree Hotels, target Rs 93: Nirmal Bang Institutional Equities - The
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RADIOET NOWTIMES NOWETMarkets.com|Updated: Jul 13, 2018, 04.59 PM ISTNirmal Bang Institutional Equities has a buy call on Lemon Tree Hotels
Ltd
with a target price of Rs 93
The current market price of Lemon Tree Hotels Ltd
is Rs 75.5
Time period given by the brokerage is a year when Lemon Tree Hotels Ltd
price can reach defined target
Lemon Tree Hotels Ltd., incorporated in the year 1992, is a midcap company with a market cap of Rs 6173.34 crore. Investment rationale by
Nirmal BangWe initiate coverage on Lemon Tree Hotels with a Buy rating and a target price of Rs 93 based on 30xFY20E EV/EBITDA
middle-income domestic consumers, geographical expansion and cost control
The main reasons for our optimism are: 1) Cyclical upturn in the hotel sector along with favourable demand-supply dynamics expected to drive
the occupancy rate and average room rate (ARR)
2) Strong demand from the domestic middle-income segment
Lemon Tree Hotels (LTHL) has a focused strategy which has aided in strong growth and is expected to drive future growth
b) Geographical spread across more than 30 cities in India to reduce exposure to local, seasonal and cyclical fluctuations in demand
c) High operating leverage with a strong focus on cost control
d) Efficient capex management with lower-than-industry capex per room
e) Strong balance sheet with a comfortable net debt to equity ratio, despite high capex
It also has a negative working capital
We have valued the stock at 30x FY20E EV/EBITDA and arrived at a target price of Rs93. Read this article inHindiBuy Federal Bank, target Rs
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794: Nirmal Bang Institutional EquitiesCommenting feature is disabled in your country/region.Disclaimer: This recommendation is analyst's
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