Pick of the Week: Hotel Leela

BUY BUY BUY HOTEL LEELA

Equity : 75.56 Cr, BSE Code : 500193, CMP : 45.05


Hotel Leelaventure Limited is the promoter of the 5-star deluxe ho-tels in Mumbai, Goa, Bangalore and Kovalam. The hotel was founded by Captain C. P. Krishnan Nair. Hotel �eelaVenture Ltd owns and manages hotels under The Leela Palaces & Resorts brand in India. It has a management alliance with Kempinski, the oldest hotel group in Europe. All the hotels of the company are co-branded with Kempinski. The Leela Group has planned new properties in Udaipur, Hyderabad, Pune and Chennai. The hotel of 360 guest rooms situated at Adyar beach, Chennai fac-ing the Bay of Bengal admeasuring about 6.5 acresis expected to be commissioned in near futureat an estimated cost of around Rs 3,200 million. Another 300 roomhotel at Banjara Hills, Hyderabad is expected to commence operations in the near future at an estimated cost of Rs 3,100 million. The Leela Group is also setting up a 260 room hotel in Pune at an estimated cost of Rs 1,600 million which is expected to commence operations in the near future only.

The Hotel Leela entry into Hyderabad and Pune would give fillip to its revenues due to an increase in the growingIT and ITeS industries in these cities. Both the cities in recent past seen huge surge in demand due to the growing number of business travelers thereby increasing the occupancy rates of the rooms. The Hotel Leela with upcoming hotels in Gurgaon, Udaipur, Chennai, Delhi, Pune and Hyderabad will have 2,750 rooms over the next three years from the current 1,086 rooms. Of the six proposed projects, the Gurgaon hotel is expected to be operational first followed by projects in Udaipur, Chennai, Delhi, Hyderabad and Pune. These facilities once becoming operational will generate huge turnover for the Hotel Leela and thereby add to its top line and bottom line. Sales and NP for year ended 06 � 07 were 393.7Cr. & 98.6Cr. Sales and NP for latest Quarter 143Cr. & 55Cr.

On YOY basis NP has increased by 33% & based on quarter latest its increased by 54% Dividend during year ended 06 � 07 was 23%