Target: ₹365

CMP: ₹292.60

Mahindra Holidays & Resorts India Ltd (MHRIL), a significant player in India’s domestic and international leisure and hospitality industries with resorts, aspires to provide customers with a unique vacation ownership model through its network of resorts nationwide. MHRIL has been voted the ‘Best Workplace in Hotels and Resorts Category’ by Great Place to Work Institute in 2021.

The company has committed to obtaining carbon neutrality by 2040. It is also the first hospitality company in India to sign. The Climate Group’s global campaign, aiming to run on 100% renewable energy by 2050 and double its energy productivity by 2030.

The company’s Q3 performance was driven by the uptick in leisure travel and believes that it will expand even this year as people continue to go on holidays with family and friends. MHRIL reported a revenue of ₹602.10 crore entailing a YoY growth of 8.8 per cent in Q3FY23.

The operating profit stood at ₹90.70 crore, resulting in a growth of 12.1 per cent in Q3FY23 on a YoY basis.

We recommend a buy with a target price of ₹386 with a P/E of 44x and EPS of ₹8.7 (FY25), owing to strong member addition, aggressive inventory build-up and continued investments to increase customer engagement avenues