Nomura bets on India hotel boom: IHCL, Leela lead with 12-15% ADR surge as domestic demand offsets foreign dip
Nomura sees Indian hotels riding resilient domestic travel through FY26-FY28, with Q4 revenue up 12% YoY and EBITDA up 9%. Super-luxury players EIH and Leela posted ADR gains of 12-15% but ceded 4-6% occupancy. Buy calls on IHCL (TP Rs 800) and Leela (TP Rs 530), with sector EBITDA growth pegged at 14-16% and FY26 margins near 37.3%.
Nomura expects Indian hotel sector to grow on resilient domestic demand offsetting foreign tourist dip; super-luxury players EIH and Leela lead on rates but lose occupancy. Buy ratings on IHCL (TP Rs 800) and Leela (TP Rs 530).