Why is Jefferies bullish on this ‘Tata Group Stock’? Here’s what’s powering the big Buy call
International brokerage house, Jefferies has maintained Buy rating on Indian Hotels Company with a target of Rs 733 per share. The scale-up and transformation alluded to by this Tata Group company is one of the key reasons for the bullish target that implies nearly 34% upside from current levels.
Jefferies pointed out that the company has maintained double-digit revenue growth guidance for FY26 and reiterated FY30 targets of doubling the portfolio, consolidated revenues, expanding new/reimagined businesses.
Jefferies on Indian Hotels: Strong track record
According to Jefferies, diversification is a hedge against cyclicality. The management highlighted that the overall Rev/EBITDA has expanded 2x/4.5x over FY17-FY25.
The portfolio hotels/rooms over the same period have also grown 2.5x.
The other key factor that’s helping is the expansion in the “scope of topline with expansion into new segments to hedge against sector cyclicality.”
While the Taj brand has remained the mainstay, the company is adding depth with new brands like expanding Ginger, re-imagined gateway, acquiring Tree of life and Claridges Collection. It is also entering new segments like branded residences.
Jefferies on Indian Hotels: Maintaining double-digit revenue growth target
Another big positive for Jefferies is that, Indian Hotels believes hospitality remains in a sustained upcycle. It continues to expect double-digit revenue growth in FY26, driven by strong same store performance, sustained momentum in New Businesses, and 30 new hotel openings. Growing share of new businesses support their bullish call.
Jefferies on Indian Hotels: Targets doubling portfolio by FY30
As of May, the company has a portfolio of 388 hotels, of which 249 are operational. Indian Hotels targets a portfolio of 700 hotels by FY30, with operational hotels moving to 500+ hotels. This along with the greenfield projects will help in clocking accelerated growth, as per Jefferies.
Indian Hotels share performance
The Indian Hotels share price has been under pressure so far in 2025, down 12% in the first 6 months of the year. On a yearly basis, it has delivered over 23% returns.