EIH Hotels

EIH Hotels

ACC, Ambuja Cements, Colgate, Dabur, EIH Hotels, Havells, HPCL, Navabharat Ventures, PNB, Sadbhav Engineering

ACC, Ambuja Cements, Colgate, Dabur, EIH Hotels, Havells, HPCL, Navabharat Ventures, PNB, Sadbhav Engineering

EIH Hotels

EIH Hotels

Deccan Chronicle, Dabur India, Dishman Pharma, EIH Hotels, Elecon Engineering, EMCO, Entertainment Network, GMR Infrastructure Deccan Chronicle, Dabur

Deccan Chronicle, Dabur India, Dishman Pharma, EIH Hotels, Elecon Engineering, EMCO, Entertainment Network, GMR Infrastructure

Analjit Singh to hike stake in EIH: reports

Max India’s Analjit Singh is reportedly planning to buy stake in EIH and could join the founding Oberoi family as co-promoter and vice-chairman of third-largest hotel chain. A deal is likely to be finalised early next month. Singh owns around 26% in EIH, the operator of the Oberoi and Trident brands and the third-largest hotel chain behind Indian Hotels and ITC. Together, Singh and the Oberoi family will own a 52% stake in EIH. The Oberoi family, which owns 43% in EIH, will sell a little over 17% to Singh for up to Rs12.5bn, the report stated. Along with Singh’s shareholding through purchases in the open market, his stake will rise to 26%. Singh and EIH chairman PRS Oberoi have already signed a non-disclosure pact, and a due diligence for a final deal is currently under way, the newspaper report said. Once a deal is finalised, Singh will make the mandatory open offer for an additional 20% stake at a price expected to be between Rs165 and Rs185 per share.

But Singh, Max India founder, said that he is considering purchasing a stake in hotel operator EIH. "The matter is under deliberation," Singh was quoted as saying. While EIH Chairman PRS Oberoi said that "no decision has been taken." ITC, which owns nearly 14.9% in EIH, is evaluating the situation. A business daily quoted bankers close to ITC as saying that the FMCG giant may raise its holding to 15% and make an open offer for another 20%. LIC, New India Assurance and GIC together own a little over 10% in EIH while Reliance Capital's holding is a shade over 2%.

Dishman Pharma, EKC, EIH Hotels

Dishman Pharma, EKC, EIH Hotels

EIH Hotels

We recommend a buy in EIH from a short-term trading perspective. It is evident from the charts of EIH that it has been on a medium-term downtrend from its September peak of Rs 172, gradually forming lower troughs and lower peaks.

However, the stock recently found support at around Rs 75 (June 2006 trough) and in pausing there. As the stock recovered from this long-term support level, the medium-term downtrend appears to have been arrested. The stock is currently testing the medium-term down trendline. The daily relative strength index (RSI) is displaying bullish divergence, signalling trend reversal and is heading towards the neutral region from the bearish zone.

The weekly RSI is recovering from the oversold territory. Moreover, the moving average convergence and divergence is indicating a buy, supporting our view. Our short-term forecast for the stock is positive. We expect the stock to penetrate the down trendline and rally until it hits our price target of Rs 92 in the forthcoming trading sessions. Traders with short-term perspective can buy the stock while maintaining a stop-loss at Rs 79.

EIH Hotels

EIH Hotels

Today's Pick - EIH

We recommend a sell in EIH from a short-term perspective. From charts of the EIH, we note that the stock has been on a downtrend (forming lower peaks and lower troughs) form its 52-week high of Rs 246 (touched on January 7).

However, in late March the stock found support at around Rs 119 levels and witnessed a corrective up move to Rs 160 level.

The stock met with a resistance (down trendline) around Rs 160 levels during late April and it failed to surpass this resistance due to selling pressure. Subsequently the stock began to decline and it appears to have resumed its downtrend.

On May 9, the stock fell penetrating the 50- and 200-day moving averages, indicating further bearishness. The daily momentum indicator is on the verge of entering the bearish zone.

A cross over in the daily moving average convergence and divergence indicates a sell signal. We are bearish on the stock in the short-term.

We expect the stock’s downtrend to continue until it hits our price target of Rs 124 in the upcoming trading sessions. Investor with short-term perspective can sell the stock while keeping the stop-loss at Rs 149.

via BL

Citigroup Reports

Citigroup - Indian Hotels

Citigroup - Zee TelefilmsCitigroup - Hotel LeelaCitigroup - EIH Hotels

EIH Ltd Conference Call hosted by India Infoline Ltd

EIH is constructing a 440 room Trident hotel in Mumbai on which it has so far spent about Rs3.3bn and another Rs4bn would be incurred over the next two years.

* EIH Ltd owns more than 1,800 rooms and has one hotel under management contract. Majority of revenues accrue from five properties-two each in Mumbai and Delhiand one in Bangalore.

* Mumbai and Delhi contributed about 30% each to FY06 revenues

* For the company, Average Room Rates (ARRs) in FY06 was above Rs8,000 while Occupancy Rate (OR) was about 68%.

*The company’s printing press segment had revenues of about Rs350mn and operating profit of about Rs100mn in FY06 which it expects to cross about Rs1bn in the next four years.

* Debt as of FY06 was about Rs7bn which it expects to remain more or less the same for FY07. However, it would be higher if borrowings of about Rs3bn are resorted to for its Mumbai hotel, which would be in tranches

*EIH had a swap loss of about Rs150mn in H1 FY07 which it expects to more than double for the full year.

* Its Bangalore hotel currently has ARRs of Rs14,000 with an OR of about 80%.

* Its Kolkata hotel, Oberoi Grand, has ARRs of about Rs6,000.

Mumbai Expansion

* EIH is constructing a 440 room Trident hotel in Mumbai on which it has so far spent about Rs3.3bn and another Rs4bn would be incurred over the next two years.

*About 220 rooms would be available after the completion of first phase of the hotel in 2008-09.

Outlook

* For FY07, the company expects ARRs to be above Rs10,000 while OR is likely to be in the range of 70-71%.

* Revenue Per Available Room (RevPar) is estimated to increase by about 34% yoy in 2006-07.

*Mumbai and Delhi are expected to register ARR growth of about 25% and 30% respectively in FY07 and about 25% each in FY08.