Hotel Leela : Lame duck or dark horse?
Printed From: The Equity Desk
Category: Investment Ideas - Creating winning portfolios!
Forum Name: Stock Synopsis
Forum Discription: A bried discussion of companies on very specific matters. Normally this is the prelude for further research as always members would be discussing quality companies with good management only
URL: http://www.theequitydesk.com/forum/forum_posts.asp?TID=1085
Printed Date: 21/Apr/2025 at 4:32pm
Topic: Hotel Leela : Lame duck or dark horse?
Posted By: Krishna
Subject: Hotel Leela : Lame duck or dark horse?
Date Posted: 17/Jul/2007 at 12:46pm
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Guys, I am puzzled. Under the prevailing economical conditions this stock should have delivered steller performance. It has been flat almost for an year now. The company seem to have got everything right. Great brand, Great locations, Great occupancy rates.... and upcoming Great projects. But why this stock is not delivering? Here is an excerpt from recent press release of Leela group.
Standard & Poor, the most respected name in performance ratings, spotted 300 Companies world-wide that can pose a challenge to the world's leading Companies in their respective fields. In India Standard & Poor identified seven Companies last year and eight this year to include the Leela.
The report noted their Indian equity in the universe of listed stocks is less than 396. Last year three Indian commercial banks featured in the Standard & Poor rating. This year no bank is listed. Standard & Poor drew up this year's list on the basis of market capitalization which has to be in the range of $ 500 million to $ 5 billion. They also need to post price appreciation for three years in a row. These Companies also need to post a growth in their earnings per share and the number of employees. The Leela has grown by leaps and bounds in the last three years with luxury hotels in Mumbai, Bangalore, Goa, Kovalam Beach and Delhi. It has acquired prime property in the Diplomatic Enclave in New Delhi at a cost of Rs 611 crores for a super luxury seven-star hotel besides new projects at Gurgaon, Udaipur, Chennai, Hyderabad and Pune. All these will come up and be operational between 2007 and 2010. |
Replies:
Posted By: Rinku
Date Posted: 17/Jul/2007 at 5:55am
| HIGHLY underperformer.I am stuck here. |
Posted By: Rinku
Date Posted: 17/Jul/2007 at 5:55am
| Infact all the hotel stocks |
Posted By: manishdave
Date Posted: 17/Jul/2007 at 6:18am
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But why this stock is not delivering? Only refurbishment of Mumbai, Bangalore properties should be completed by now, other Hotel projects may take couple of years more. Not much growth in operation till then. Couple of commercial projects may complete next year. |
Posted By: CHINKI
Date Posted: 18/Jul/2007 at 2:49pm
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Absolutely right Manish. I had these stocks till last week. But future does not seems to be bright. Because:
- 53% of revenues comes from Leela Bangalore where the Av. Room Rate is highest in the country. Occupancy is also more than 80%. Hence nothing much can be expected here - other than Bangalore and Mumbai where they have done refurbishing, fresh rooms are not going added till 2008/09 - the New Delhi plot which they have bought at one of the highest rate will take minimum 12 to 13 years to breakeven after it starts - it has very high gross gearing (200%-incl.o/s FCCBs of US $170mn plus major capex plans - Growth (16.5%)in revenues for the last financial year is not satsifactory - EBITDA margins are down by .7% But its current CMP is less than its BV  ------------- TOUGH TIMES NEVER LAST, BUT TOUGH PEOPLE DO |
Posted By: Vivek Sukhani
Date Posted: 18/Aug/2007 at 1:06pm
| Also, FCCB conversion price sets out at Rs. 62 at that euro level. And the most terrible part is the company is not providing for interest on FCCB. I beleive it should be provided upfront by deducting from share premium or at least pro-rata by apporting the yield over the period. I find Oriental to be a better bet, although hotels as a space is totally untouchable for me.... |
Posted By: manishdave
Date Posted: 18/Aug/2007 at 9:33pm
| They were supposed to recive huge amout(may be 150+ Cr) from hudco as per court verdict. Any news on that? I lost track on this company after selling.... |
Posted By: basant
Date Posted: 18/Aug/2007 at 10:35pm
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Hotels like hospitals and schools have quite similar business models. They need capex for volume growth. Companies like Viceroy where the capex has been put up but is yet to convert itself in terms of revenues are OK but in several other cases these business models are cyclical.
Does any one have any idea of people making tonnes of money in schools/college and hospital stocks - the ones with physical infrastructure. Apollo is one education company in the US that runs the CFP program and is valued at US $ 13 billion but have never seen a big mkt cap company running physical schools and colleges. ------------- 'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in |
Posted By: Vivek Sukhani
Date Posted: 18/Aug/2007 at 9:18am
I doubt whether this stock is less than its book value. As per my calculations its coming out to be 24.34. I would like to clarify here that I dont go by NAV or Market Capitalisation in my calculation as in my opinion the book value simply means the price of net assets held by you, expressed at a price financed by you......
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Posted By: dilip.r
Date Posted: 20/Apr/2011 at 11:40am
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is it time to relook into this company!!!!
any update ?
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Posted By: dilip.r
Date Posted: 20/Apr/2011 at 11:42am
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Posted By: dilip.r
Date Posted: 20/Apr/2011 at 11:46am
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Posted By: dilip.r
Date Posted: 20/Apr/2011 at 11:49am
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600 crs for 14.95 crs
ie valuation for 100 % is 600*14.95/100 = 4013 crs
Current Market cap - 1642 Crs
????
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Posted By: dilip.r
Date Posted: 21/Apr/2011 at 12:12pm
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Expansion Plans
 New Delhi
Expected Completion Date Q2FY11 Proposed Location Chanakyapuri, New Delhi Category 5-star deluxe No. of Rooms 260 Business Model Owned and operated Current Status Under construction Chennai
Expected Completion Date Q1FY12 Proposed Location MRC Nagar, Adyar, Chennai Category 5-star deluxe No. of Rooms 332 Business Model Owned and operated Current Status Under construction Immediate Plans Agra
Proposed Location Near TajMahal No. of Rooms 80 Current Status Land acquired Long term plans Hyderabad
Proposed Location Banjara Hills, Hyderabad No. of Rooms 360 Current Status Land acquired |
Posted By: dilip.r
Date Posted: 21/Apr/2011 at 12:13pm
| Disclosure : i have currenly no holding in this company.. |
Posted By: bearish
Date Posted: 21/Apr/2011 at 1:11pm
| The Chanakyapuri Leela, New Delhi had a press preview launch on this Monday. It's opened. |
Posted By: dilip.r
Date Posted: 21/Apr/2011 at 2:58pm
| interest burden is still a matter of concern... |
Posted By: richard123hopes
Date Posted: 19/May/2011 at 1:15am
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