Brokerage firm HSBC has upgraded Ventive Hospitality Ltd. to 'buy' from 'hold', citing attractive valuations that it believes are now at the bottom of the cycle.
However, it has cut the target price to Rs 685 from Rs 856 to factor in near-term operational risks and softer demand trends. The current market price of the stock is Rs 562.85. Even though the target price is trimmed, the stock still shows a potential upside of 21% as compared to the current market price.
The India-based hospitality company focuses on luxury-focused hospitality platforms, operating hotels and resorts in Pune and the Maldives
HSBC noted that Ventive's strong performance in January and February was partially offset by weakness in March, driven largely by a slowdown in corporate travel and disruptions in the meetings, incentives, conferences and exhibitions (MICE) segment. The brokerage mentioned that tourism in Maldives held up well until February but fell 20% in March and further weakened in early April, adding that tourism could be further impacted since Maldives is running short on diesel.
Despite this moderation, the brokerage expects average room rents to remain largely stable over the medium term. The brokerage flagged operational risks as a key concern, particularly the ongoing diesel shortage in the Maldives, which it said could potentially lead to the temporary closure of Male airport. HSBC estimates that a week-long closure of Male could wipe out around 1% of Ventive Hospitality's FY27 profit.
Share Price Today
Ventive Hospitality Ltd Share Price Today
Shares of Ventive Hospitality fell over 2% during the day to Rs 558.15 apiece on Tuesday, compared to a 0.12% fall in the benchmark NSE Nifty 50. It has fallen 15.78% in the last 12 months and 24.55% year-to-date. Total traded volume so far in the day stood at 0.10 times its 30-day average.
The relative strength index was at 56.75. Out of seven analysts tracking the company, all seven maintain a 'buy', according to Bloomberg data. The average 12-month consensus price target of Rs 783.43.
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