Royal Orchid Hotels - Available at good valuation!

(Abhishek Basumallick) #63

(Hardik) #64

Today on concall someone asked management’s view on share price which is apparently very cheap. Management categorically denied that they do not indulge in any activity to control the share price. May be he wanted to get a sense on whether promoter is looking to increase their stake.

I am just curious on the valuation part. Valuation has not been discussed in detail on this thread so request others to share their views.

What multiple should be assigned to managed hotels? Isn’t EVEBITDA more appropriate for owned hotels? Their owned hotel of 195 rooms in Bangalore alone may fetch value equal to current market cap at 1.5cr per room. How to value leased hotels? It may depend on term of lease period. Ofcourse these numbers will have to be adjusted for Debt and Operating efficiency and they have land parcels.

(Abhishek Basumallick) #65