ITC Hotels
ITC Hotels
Leisure ServicesKey Fundamentals
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Key Insights
Strengths
1- Company is almost debt free.
Weaknesses
2- Stock is trading at 2.83 times its book value
- Company has a low return on equity of 6.65% over last 3 years.
Growth Rate
AI Analysis — Bull vs Bear
ITC Hotels has a market capitalisation of about ₹33,834 crore and trades at a P/E of 39.3x and a P/B of 2.93x. For FY26 it reported consolidated revenue of ₹4,139 crore (up 16%), EBITDA of ₹1,424 crore (up 21% on a comparable basis) and PAT before exceptional items of ₹888 crore. The company is almost debt free, but return on equity is low: 7% over 3 years and 8% last year. The stock is down 28% over the past year.
- Growth is strong. TTM sales grew 16% and TTM profit grew 35%, and FY26 EBITDA rose 21% to ₹1,424 crore, so profits are growing faster than revenue as fixed costs are spread over more sales.
- The balance sheet is almost debt free. That keeps interest costs low in a capital-heavy business and gives room to fund expansion.
- Quarterly growth has been steady. Q3 FY26 revenue rose 21% to ₹1,231 crore, EBITDA rose 23% to ₹467 crore and PAT before exceptional items rose 42% to ₹307 crore. The EBITDA margin was 39%, up 110 bps on a comparable basis.
- Q4 FY26 consolidated PAT rose 23% year on year to ₹316 crore, and EBITDA rose 13.1% to ₹466.3 crore. Profit growth continued through the year.
- Margins are high for Indian hospitality. The Q4 FY26 EBITDA margin was 37.2% and Q3 was 39%, helped by growth in rooms and F&B and by higher management fees.
- Occupancy was about 79% in FY25 and room rates were firm. The company is expanding, including into Sri Lanka, which could support growth in hotel count and management-fee income.
- The stock is down 28% over one year while profit grew 35% TTM. The valuation multiple has therefore come down relative to earnings compared with a year ago.
- The company pays dividends, with a Re 1 per share dividend declared for FY26. The dividend yield is 0.61%.
- Return on equity is low: 6.65% over 3 years and 8% last year. For an asset-heavy hotel owner, this is likely below the cost of equity.
- The valuation is high. The stock trades at 39.3x earnings and 2.93x book value while ROE is in single digits. Market cap of about ₹33,834 crore is roughly 24x FY26 EBITDA of ₹1,424 crore.
- The stock is down 28% over one year even though profit grew 35% TTM. Investors appear to be marking down the valuation rather than rewarding the earnings growth.
- Margins have started to slip. The Q4 FY26 EBITDA margin fell to 37.2% from 38.9% a year earlier, and Q4 EBITDA growth slowed to 13.1% from 23% in Q3.
- The dividend yield is only 0.61%, which gives little income support at a P/E of 39.3x.
- Hotels are a cyclical business that depends on travel and discretionary spending. The company itself described FY26 results as coming 'amidst global turbulence'. With occupancy already around 79%, further growth depends more on room rates, which could reverse in a downturn.
- The company only recently became a separate listed entity, so 3-, 5- and 10-year track records for sales, profit and stock returns are not available. That limits how well growth durability can be judged.
- The business needs a lot of capital. At a P/B of 2.93x and a market cap of about ₹33,834 crore, the implied book equity is about ₹11,500 crore, which supports FY26 PAT of ₹888 crore. New owned properties could keep returns low while they ramp up.
This is AI-generated analysis, not financial advice. Do your own due diligence.
AI News Digest
- Trading window closed pre-Q2FY27 Sep 25
ITC Hotels closed its trading window for designated persons from October 1, 2026. It reopens 48 hours after the unaudited results for the quarter ending September 30, 2026 are announced.
- Jefferies, JPM, BofA conference participation Sep 14
ITC Hotels will take part in three major investor conferences in September 2026, hosted by Jefferies, J.P. Morgan and BofA Securities.
TL;DR: Recent news flow is limited to routine regulatory and investor-relations disclosures, with no material positive or negative developments for ITC Hotels. Attending three global brokerage conferences shows active engagement with institutional investors, though it does not change fundamentals on its own. These articles give no read on operating trends such as occupancy, ARR or margins, so the near-term direction is unclear. The next meaningful catalyst is the Q2FY27 results for the quarter ending September 30, 2026, likely due in October-November 2026.
Quarterly Results
| Particulars | Jun 2024 | Sep 2024 | Dec 2024 | Mar 2025 | Jun 2025 | Sep 2025 | Dec 2025 | Mar 2026 | Jun 2026 |
|---|---|---|---|---|---|---|---|---|---|
| Sales | 706 | 778 | 1,015 | 1,061 | 816 | 839 | 1,231 | 1,254 | 936 |
| Expenses | 500 | 566 | 635 | 648 | 571 | 594 | 764 | 787 | 644 |
| Operating Profit | 206 | 212 | 381 | 412 | 245 | 246 | 467 | 466 | 292 |
| OPM % | 29% | 27% | 37% | 39% | 30% | 29% | 38% | 37% | 31% |
| Other Income | 14 | 7 | 19 | 43 | 48 | 49 | -34 | 60 | 62 |
| Interest | 2 | 2 | 2 | 2 | 2 | 2 | 2 | 2 | 2 |
| Depreciation | 95 | 104 | 104 | 100 | 102 | 104 | 104 | 106 | 104 |
| PBT | 123 | 114 | 294 | 354 | 189 | 189 | 327 | 418 | 248 |
| Tax % | 29% | 33% | 27% | 27% | 29% | 29% | 28% | 24% | 27% |
| Net Profit | 87 | 77 | 216 | 258 | 134 | 133 | 237 | 317 | 182 |
| EPS in Rs | — | — | — | 1.23 | 0.64 | 0.64 | 1.13 | 1.52 | 0.87 |
Profit & Loss
| Particulars | Mar 2024 | Mar 2025 | Mar 2026 | TTM |
|---|---|---|---|---|
| Sales | 2,224 | 3,560 | 4,139 | 4,260 |
| Expenses | 1,454 | 2,307 | 2,660 | 2,788 |
| Operating Profit | 771 | 1,253 | 1,480 | 1,471 |
| OPM % | 35% | 35% | 36% | 35% |
| Other Income | 16 | 77 | 115 | 138 |
| Interest | 20 | 44 | 55 | 8 |
| Depreciation | 201 | 402 | 417 | 418 |
| PBT | 565 | 884 | 1,123 | 1,182 |
| Tax % | 25% | 28% | 27% | — |
| Net Profit | 424 | 638 | 821 | 869 |
| EPS in Rs | — | 3.05 | 3.92 | 4.16 |
| Div. Payout % | 0% | 0% | 26% | — |
Balance Sheet
| Particulars | Mar 2024 | Mar 2025 | Mar 2026 |
|---|---|---|---|
| Equity Capital | 83 | 208 | 208 |
| Reserves | 8,415 | 10,484 | 11,450 |
| Borrowings | 74 | 73 | 74 |
| Other Liabilities | 1,617 | 1,707 | 1,748 |
| Total Liabilities | 10,188 | 12,472 | 13,480 |
| Fixed Assets | 6,436 | 8,189 | 8,089 |
| CWIP | 1,768 | 158 | 207 |
| Investments | 204 | 676 | 1,956 |
| Other Assets | 1,780 | 3,449 | 3,229 |
| Total Assets | 10,188 | 12,472 | 13,480 |
Cash Flow
| Particulars | Mar 2024 | Mar 2025 | Mar 2026 |
|---|---|---|---|
| Operating | 672 | 801 | 1,110 |
| Investing | -753 | -2,203 | -1,174 |
| Financing | 127 | 1,430 | 19 |
| Net Cash Flow | 47 | 27 | -46 |
| Free Cash Flow | 22 | 419 | 701 |
| CFO/OP | 116 | 81 | 95 |
Ratios
| Particulars | Mar 2024 | Mar 2025 | Mar 2026 |
|---|---|---|---|
| Debtor Days | 24 | 21 | 20 |
| Cash Conversion Cycle | 24 | 21 | 20 |
| Working Capital Days | 48 | 48 | 43 |
| ROCE % | — | 10% | 11% |
Insights
BetaAI-extracted from concalls & annual reports · figures as reported, with sources
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55 extracted metrics + investor summaries across FY23–FY27.
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Company Information
ITC Hotels is an Indian hospitality company that operates and manages hotels, with over 200 hotels. It has a franchise agreement to operate most of its hotels as part of The Luxury Collection of Marriott International. It operates hotels across 90+ destinations under brands like ITC Hotels, Mementos, Epiq Collection Storii, Welcomhotel, Fortune, and Welcome Heritage.[1][2]
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