Hi Vivek,
Do you know how are they financing their new properties, like the one in New Mumbai (specially) and Hyderabad ? Is there going to be an additonal debt ?
Through internal accruals. Over the four years (construction time) the free cash flow is suffice to fund the construction. They addressed this in the concall
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Sir,
As on Sep-25 PPT, net debt is ~1400 Cr. Annual report figures are as on Mar-25. Am I missing something? Happy to get corrected.
Hey Mr Bisht,
its from internal accruals only. No external debt taken as of now for the same. For Newer Banglore (bengaluru) hotel expansions, they would be using fund raised from GIC.
Hey Rahul,
~1400 Cr you are talking about is actually net debt (Borrowings-cash & cash Equivalents).
1963 Cr was their long term borrowings in FY25, which now stands around ~1538 Cr. This Debt reduction is mainly through the money received by stake sale to GIC & Proceeds from Sale of Caspia Delhi.
The idea to take Fy25 timeline was to asses the debt servicing profile as you will get that information in only their annual reports & not Half yearly results.
Hope this clears your doubt.
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Samhi Hotels - Q2 FY26 Con call Highlights
Same store RevPAR grew by 11.2% YOY to INR 5026 in line with long term guidance of 9 to 11%
EBITDA grew at INR 110 crores a 14% increase, with margins improving at 37% (35% last year & 33% in Q1)
Net Debt is currently at 1370 crores down from 1967 crores(as on Mar 31,2025). (Net Debt to EBITDA at 2.9X)
Average interest cost has fallen to 8.5%, credit rating upgraded to A+ with a Stable outlook.
Expect interest expense run rate at 35 crores per quarter.
Across portfolio 1500 rooms under development this will take total number of rooms to 6300 rooms in near future.
W Hyderabad in HITEC city 170 room - Dec 2026 opening.
2 Major Developments this quarter ~
First - Navi Mumbai project total 700 rooms - Dual Branded (Phase 1 - 400, Phase 2 300 - rooms). Completion target 3 to 4 years EBITDA potential of approx. 180 to 185 crores (at current RevPAR).
Second - Signing of 260 room mid scale hotel under long term variable lease in Hyderabad’s Financial District.
Given the current run rate of revenues and EBITDA, management sees about 1700 crores of investable surplus over a period of time. Capex of 1500 crores spread over a period of 5 years.
Management expects total revenue from long term variable leases to go to 20 to 25%, as cost per key is much lower under variable lease.
SAMHI will look at M&A and leases. (Navi Mumbai came as a part of an acquisition as it was ACIC acquisition)
Rev par will be better and far ahead of H1
Management will not compromise on location, as location has yielded better results.
Disclosure : Invested. No transactions in last 30 days.
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Can the experienced guys here tell me whats happening. I am a newcomer, just 2 years old in Stock market. Samhi is doing great. Top class Management, Investors, Marquee pipeline, Sectoral tailwind, Results speaking, great thesis. so why is the price behaving like that? is it for shaking out nervy retailers like me? Agreed price isnt in our control, we can only look at our convictions but any behavioural pattern I am missing out? Any pointers will greatly help. @vivek_lakhani sir
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Hi Nik…
Can’t say anything about others, but I will share my views on SAMHI…
I was holding significant portion of my portfolio (around 8%) at one point of time but exited few months back at breakeven.
- My main concern with the company is regarding… whether they can grow without raising additional capital through debt or diluting the equity… And since I was pessimistic I exited…
- The business model of SAMHI is around acquiring distressed assets, put in capital, turn it around & rebrand it with established brand and earn from it.
- Since, they don’t own the brand, the income generated due to brand value is to be shared with the brand owner, which means SAMHI income will be very limited here.
- By acquiring distressed asset and turning it around, investors are actually betting heavily on the execution skill of the management. Since this is a asset heavy business, which means there are loads of regulatory pressure plus local challenges which the mgmt has to navigate through each time successfully. Any falter will reduce the RoCE for the company.
- Asset Heavy Business are generally valued at lesser valuation than Asset Light Business by the market.
- While established brand like IHCL is talking about, going more into lease & operate business model (Asset Light), SAMHI business model is totally opposite to that.
- Although, SAMHI has recently started to lease office building and turn it around, this could actually be positive.
- SAMHI is primarily into business hotels, so their cash flow is directly linked to business activities in those cities.
- They manage global hotel brands, which gives them access to brand loyalty programs and this is supposed to attract foreign travelers, but global trade is in headwind.
- SAMHI don’t have leisure hotel portfolio, so they are not benefiting from domestic/foreign tourist travelers. And Market knows this.
- Lastly, post covid hotels sector was in boom for last 4-5 years, I am skeptical how long it will continue.
Everything i shared is my thought process and i don’t have any hard evidence to back it up… So take it with lots of Salt… Plus I just have 4years of market experience, so i am very new in the market like yourself…
Thank You…
Disc: Dont Hold Now…
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Will keep it short.
1.) As you can see, there is inherent slowdown in the momentum in overall Hospitality industry in terms of price movement. (M.Cap Weighted Price average)
2.) Is the thesis for samhi playing well (Debt reduction 
, RevPar growth above 10% , Ebitda growth , Revenue growth , Higher segmental growth from upper-Upscale , Company profitable , Cash Flow improving , ROCE Improving , Better Capex in pipe line , Promoter integrity , Company about to come in operating leverage , Manageable debt servicing , Sectorial tailwinds , Location based tailwinds )
3.) Now coming to your Question on why negative reaction to a good result. As always its a tandem to Expectations vs Actual. There was one time exceptional income due to Reversal of Impairment of Navi Mumbai land parcel, a Exceptional income & high DTL due to sell of investment in Duct India Hotels (Chennai), Exceptional income due to Caspia Delhi sell.
This has weighed onto this result in particular & in exception.
True picture:
without exceptional income, PBT of 38.1 cr vs 25.9 cr QOQ 47%
(13.6 cr= yoy incre. 180% )
PAT without exceptional items:
15.6 cr vs 19.2 cr QoQ vs 12.6 cr YoY (high deferred tax of 19.9 cr this quarter)
4.) So as long as Thesis is playing well & there is underlying strength in the business, This should be viewed as a buying opportunity rather than a Panic selling activity.
Never have a price anchoring bias for any stock. There are N-Number of reasons for a stock’s price volatility.
In this, it can be attributed that its moving from weak hands into strong hands & impatient-momentum-trading based TRADERS to sound-patient investors.
My Investing Horizon = Atleast till FY30, given the thesis playing well, intact going forward & no news which would make balance sheet weaker.
Disc: Invested & Adding on every fall.
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I am following and invested in Samhi for more than a year.
From my understanding, the main issue is that FII’s investment was and is very high in the stock and they are slowly but steadily exiting the indian market.
I believe until the FII’s share become significantly down. It will always be a sell on rise scenario keeping the stock price in check.
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thank you so much for the reply. What I think is there pipeline is good for next 2/3 years. As a Hotel, they are far below the other brands but their business is different. the PE backing gives them the credibility, funds and power to run asset heavy businesses. The maths tells me even if they were to repeat last year’s performance which is quite plausible given they have extra 400 rooms, they could earn PAT close to about 200 crores giving it a 20 pe based on fy26 estimates.
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From what I have learnt, never sell businesses that are steered by exceptional management except if valuations get unbelievably expensive. From what I am seeing, the management is very sound and experienced and the valuations are either fairly or undervalued depending on how conservative you are. Given all these reasons, it is a buy and hold for me with patience to endure a flattish stock price for months.
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I will more relate this fall to accumulation mode by strong investors. FII’s still hold a large chunk and FII’s are not so desparate to sell at a loss, FII supply will come in 225-250 band if it comes which we are not sure as its a cream asset. I entered it last year around 175 levels, it rose to 225 came down 135 during march Apr and again raised to 255 in a matter of two month. There was not much fundamental change. Now there is clear fundamental change, reducing debt, no overhang for mumbai development location of which is very strategic. Commitment of capital from GIC for upper upscale development. This might be some panic selling by some of inexperienced retailers or some immature fund manager/PMS which might have entered as a testing bet.
We may see Samhi exiting mid midscale assets to free up cash and put in as JV capital with GIC for upper upscale inventory development in future. Even if they are able to rollout current inventory by 2029, stock has potential valuation surge to 12 to 15000 cr as 65% of inventory will be upper upscale, waiting for the downfall to stabilize to further increase quantities apart from my untouched core holdings, even from a swing trade perspective its looking quite good:joy:
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Personally, I feel that’s the biggest issue with this stock. There is too much supply. There is no long-term management with a sizeable ownership.
After trying to enter this stock multiple times, I have realised it’s best to enter above 250. Let someone else absorb all the supply. I am okay to enter even after a 40% run-up. There is no point in doing deep value hunting.
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I had a doubt while looking at Samhi. Buffett and Pulak Prasad both say we should avoid turnaround stories. But Samhi’s business is turning around stressed hotels.So does that warning apply here or is this different because the turnaround is actually their business model?
Just wanted to understand how others think about this.
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Buffet probably meant that for the regular investor which makes sense. But Samhi’s management are professionals with vast experiences in turning around hotels. We as investors are not investing in a turnaround company as Samhi is not facing financial issues. The experts on the team are investing and they have a great track record
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There is a difference between turnaround and renovation, Samhi’s business model is about renovating and upgrading hotels to improve operational efficiencies.
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World is moving towards deglobalization, Do still clients will come from abroad and stay in the hotel, I see lot of hotels of Samhi are nearby corporate office and with Indian IT future in doldrum could it hamper profitability, Imho we can play it is a short term bet but long term i am skeptical, still studying about company
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If that were the case, companies won’t be flooding to open their GCC’s in India.
The way hyderabad is stepping up its corporate game, I don’t think there’s any structural head wind for Samhi.
& since when, Corporate became a synonym with just I.T in India ?
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Courtesy: @Tar
https://twitter.com/itsTarH/status/1993175468741476524#
Market really hates Samhi Hotels
or maybe it just believes that they may not be able to generate enough ROCE
at 12x EVEBITA its the cheapest listed hotel but also is part of low ROCE group
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