Apeejay Surrendra Park Hotels Q3 Review: IDBI Capital Maintains 'Buy', Sees 36% Upside — Here's Why

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IDBI Capital Report

Apeejay Surrendra Park Hotels Ltd.’s Q3 FY25 was broadly in-line with our estimate on net sales front, while operating margin was a tad above our forecast. The company reported healthy ADR growth, particularly on QoQ basis. The management guided healthy high teens growth on ADR for FY26E, which is encouraging.

Apeejay Surrendra Park Hotels intends to double its key count to about 5000 keys in the next five years including 830 keys of its own. The company has 25 hotels underdevelopment under the brands The Park, Zone by the Park and Zone Connect by the Park with 905keys, 950keys and 698 keys respectively.

We have broadly maintained our FY26E/FY27E earnings estimates. We continue to like Apeejay Surrendra Park Hotels in domestic mid-segment hotels space and maintain Buy rating on the stock with a target price of Rs 245 (unchanged), assigning 19 times enterprise value/Ebitda on FY27E.

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