At a Glance
Kamat Hotels, parent of the ‘Orchid Ecotel’ chain, went from losses and debt traps to ₹47 Cr net profit and a 20% ROCE — without ever offering a single rupee in dividends. It’s the comeback kid of India’s hotel sector, but with one eye on the Enforcement Directorate and another on new acquisitions. Can this reformed rogue turn into a real compounding machine?
1. 🧳 WTF Do They Even Do?
- KHIL operates a chain of eco-sensitive 5-star hotels under the Orchid brand (India’s first Ecotel).
- Focuses on environmental sustainability (or at least markets it hard).
- Revenue sources:
- Room rents, banquets, food & beverage.
- Hotel management contracts.
- Consulting and setup advisory.
So yeah, it’s a hospitality company trying to make ESG sexy before it was cool.
2. 📊 Financials – Can This Hotel Print Profit Every Season?
| Metric | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Sales (₹ Cr) | 66 | 144 | 295 | 304 | 362 |
| Net Profit (₹ Cr) | -36 | -23 | 313 | 45 | 47 |
| OPM (%) | 12% | 25% | 37% | 30% | 29% |
| ROCE (%) | -3% | 7% | 26% | 18% | 20% |
| ROE (%) | – | – | – | 19% | 18.5% |
| EPS (₹) | -15.4 | -9.6 | 126.9 | 17.3 | 15.8 |
🧠 Takeaway:
- FY23 net profit was a freak event (due to ₹245 Cr other income – possibly settlement or asset write-backs).
- FY24–25 numbers are more “real” — ₹45–47 Cr steady PAT.
- Margins are robust. No more hospital bed drama.
3. 💸 Valuation – Is It Dirt Cheap or Just Dusty?
| Metric | Value |
|---|---|
| CMP | ₹242 |
| EPS (FY25) | ₹15.8 |
| P/E | 15.3x |
| Book Value | ₹94.5 |
| P/B | 2.56x |
| ROCE | 20% |
📈 Fair Value Estimate:
- Assuming sustainable EPS at ₹15–₹17
- Assigning a 14–18x multiple (hotel midcaps)
👉 Fair Value Range: ₹210 – ₹306
So at ₹242 — it’s reasonably priced, but no mouthwatering discount.
4. 🧨 What’s Cooking – News, Triggers & Twist
- 📉 Bombay HC
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