ICICI Direct Maintains 'Buy' on ITC Hotels, Predicts 45% Upside Potential
ITC Hotels: ICICI Direct keeps 'Buy' on valuation comfort, sees 45% upside
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ICICI Direct Research has reaffirmed its 'Buy' rating on ITC Hotels, raising the target price to ₹220, indicating a potential upside of 45% from the current price of ₹155.84. Despite a challenging Q4FY26, the company reported a 23.1% year-on-year profit increase and plans to acquire Zuri Hotels and Resorts, enhancing its luxury segment.
- 01ITC Hotels reported a consolidated net profit of ₹317.43 crore for Q4FY26, up from ₹257.85 crore a year earlier.
- 02The company plans to acquire Zuri Hotels and Resorts for ₹205 crore, expanding its luxury offerings.
- 03ITC Hotels' average room rate increased by 5% year-on-year to ₹15,500, despite a decline in occupancy to 74%.
- 04The company declared its first dividend of ₹1 per share since the demerger, with a record date of May 21.
- 05ITC Hotels aims to grow its portfolio to 250 operational hotels by 2031, adding 33 hotels with over 3,300 keys in FY26.
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ICICI Direct Research has maintained a 'Buy' rating on ITC Hotels, increasing its target price to ₹220, which suggests a potential upside of 45% from the current price of ₹155.84. The brokerage cites attractive valuations and strong growth potential despite a muted performance in the March quarter (Q4FY26). In this quarter, ITC Hotels reported a 23.1% year-on-year rise in consolidated net profit, reaching ₹317.43 crore, while revenue from operations increased to ₹1,253.70 crore. The company also announced plans to acquire Zuri Hotels and Resorts for ₹205 crore, which will enhance its luxury segment. Additionally, ITC Hotels has declared its first-ever dividend of ₹1 per share since its demerger, with a record date set for May 21. Analysts expect stronger growth in Q1FY27, supported by demand from weddings and corporate events, particularly if geopolitical conditions improve. With a robust cash position of ₹1,600 crore, ITC Hotels is well-positioned for future investments and expansions, aiming to increase its operational hotels to 250 by 2031.
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The acquisition and growth strategies of ITC Hotels are expected to enhance its market presence, potentially benefiting employees and stakeholders in the hospitality sector.
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