1. At a Glance
Eco Hotels (formerly Sharad Fibres & Yarn Processors) is trying to pivot from plastic recycling to hospitality. But Q1 FY26 shows just ₹0.29 Cr revenue and a ₹1.34 Cr net loss. Promoter holding sits at 38.08%, down from 72% a year ago. Losses are growing faster than the towel inventory.
2. Introduction with Hook
Imagine if your dhobi one day claimed he’s opening a luxury hotel chain—and then asked you for funding. That’s Eco Hotels for you. A dramatic identity shift, no consistent revenue, ballooning losses, and yet, sweat equity flying out like free room service.
- Q1 FY26 Revenue: ₹0.29 Cr
- Q1 Net Loss: ₹1.34 Cr
- TTM Loss: ₹3.68 Cr
- Book Value: ₹6.63
- Stock is down 53% YoY
3. Business Model (WTF Do They Even Do?)
Formerly a textile/plastic recycler, the company is now trying to reposition itself as a sustainable hospitality chain—without actually running any hotels.
They claim to focus on:
- Eco-friendly hotel chains
- Asset-light management contracts
- Luxury segment with “green” initiatives
Reality check:
Almost no operational revenue. Just the smell of fresh PowerPoint decks and sweat equity allotments.
4. Financials Overview
| Metric | FY23 | FY24 | FY25 | TTM |
|---|---|---|---|---|
| Sales (₹ Cr) | 0.00 | 0.18 | 0.17 | 0.46 |
| Net Profit (₹ Cr) | 0.00 | -5.61 | -3.56 | -3.68 |
| EPS (₹) | 0.00 | -1.79 | -0.69 | -0.60 |
| ROE (%) | – | – | -12.9% | -12.9% |
Their OPM in Q1 FY26? -420.69%
Yes, that’s a real number.
5. Valuation
| Metric | Value |
|---|---|
| CMP | ₹18.0 |
| Book Value | ₹6.63 |
| P/B Ratio | 2.72x |
| Market Cap | ₹92.8 Cr |
| TTM EPS | ₹-0.60 |
| PE | NA (loss-making) |
EduInvesting FV Range (based on zero asset monetization):
₹3 to ₹7
Current market price assumes this will be the next Lemon Tree. Reality suggests it’s closer to a fallen Neem tree.
6. What’s Cooking – News, Triggers, Drama
- Q1 FY26 loss: ₹1.34 Cr on ₹0.29 Cr revenue
- 10.3 lakh sweat equity shares issued to Executive Chairman
- No real business activity reported in recent quarters
- Previous textile business discontinued
- Rights issue/fund raise expected soon? Unofficial buzz
There’s more equity flying around than actual hotel bookings.
7. Balance Sheet
| Item | FY25 (₹ Cr) |
|---|---|
| Equity Capital | 51.51 |
| Reserves | -17.36 |
| Borrowings | 1.02 |
| Total Liabilities | 37.93 |
| Fixed Assets | 18.59 |
| CWIP | 7.66 |
| Other Assets | 11.68 |
Key Takeaways:
- Negative reserves = historical losses eating away equity
- ₹7.66 Cr CWIP? Is the hotel under construction or just imagination under paperwork?
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net Cash |
|---|---|---|---|---|
| FY24 | ₹-5.63 Cr | ₹0.03 Cr | ₹25.39 Cr | ₹19.80 Cr |
| FY25 | ₹-13.23 Cr | ₹-84.34 Cr | ₹76.92 Cr | ₹-20.65 Cr |
Running operations = massive outflow
Financing = the only thing keeping them afloat
The hotel may be “eco,” but the balance sheet is carbon-heavy.
9. Ratios – Sexy or Stressy?
| Ratio | Value |
|---|---|
| ROCE | -8.07% |
| ROE | -12.9% |
| Working Capital Days | -1,331 |
| Cash Conversion Cycle | 42.9 |
| Debtor Days | 43 |
Verdict: The only “sexy” thing here is the pitch deck. Operational metrics scream “flee.”
10. P&L Breakdown – Show Me the Money
| Q1 FY26 | ₹ Cr |
|---|---|
| Revenue | 0.29 |
| Expenses | 1.51 |
| Operating Profit | -1.22 |
| Other Income | 0.04 |
| Interest | 0.03 |
| Depreciation | 0.13 |
| Net Profit | -1.34 |
Translation: They lost ₹1.34 Cr to make ₹29 lakhs.
That’s ₹4.60 lost for every ₹1 earned. Peak hospitality!
11. Peer Comparison
| Company | CMP | Sales (Qtr) | PAT (Qtr) | ROCE | PE |
|---|---|---|---|---|---|
| Eco Hotels | ₹18.0 | ₹0.29 Cr | ₹-1.34 Cr | -8.07% | NA |
| Lemon Tree | ₹157 | ₹379 Cr | ₹108 Cr | 12.7% | 63x |
| ITC Hotels | ₹246 | ₹816 Cr | ₹134 Cr | 9.6% | 80x |
| Chalet | ₹924 | ₹522 Cr | ₹124 Cr | 11.1% | 143x |
Eco Hotels is the only one in this list that might not actually own or operate any running hotel yet.
12. Miscellaneous – Shareholding, Promoters
| Category | Jun 2025 |
|---|---|
| Promoters | 38.08% |
| Public | 59.49% |
| DIIs | 2.43% |
| No. of Shareholders | 4,065 |
Promoter stake down from 72% to 38% in just one year.
Public shareholding ballooned.
Classic operator play? Looks like it.
13. EduInvesting Verdict™
Eco Hotels is what happens when a struggling legacy company rebrands with buzzwords like “eco,” “green,” and “hospitality”—and suddenly the stock 5x-es. But look closer:
- Revenues are negligible
- Promoter stake is falling
- No real hotels seem operational
- Net losses are compounding
- Sweat equity allotments are rising
Verdict: A dream in PowerPoint. A disaster in Excel.
Unless there’s a surprise tie-up with Hilton or a miracle in real estate, this is less “Taj” and more “Dhaba with a landing page.”
Metadata
– Written by Eduinvesting Team | 23 July 2025
– Tags: Eco Hotels and Resorts Ltd, Sharad Fibres, Microcap, Hospitality, Q1 FY26, Sweat Equity, Operator Stocks, BSE:514402
