X hits on this document

33 views

0 shares

0 downloads

0 comments

9 / 13

June 23, 2009

Mahindra Holidays

Hospitality

Exhibit 11: Key Financials Y/E March (Rs cr)

FY2008

FY2009

Net Sales % chg Net Profit % chg OPM (%) EPS (Rs) P/E (x) * P/BV (x) * RoE (%) RoCE (%)

352.7 51.8 82.7 95.0 33.5 10.8 25.4 14.5 56.9 16.0

393.2 11.5 81.1 (1.8) 26.6 10.5 26.1 10.8 41.4 9.8

EV/Sales (x) EV/EBITDA (x) *

*

7.4 21.9

7.0 26.3

FY2010E

FY2011E

505.0 28.4 107.2 32.1 28.4 12.7 21.6 5.5 25.5 9.0 6.0

748.0 48.1 152.7 42.4 29.0 18.1 15.2 4.4 29.2 10.9 3.7

21.2

12.7

Through this IPO, which also involves an offer for sale by the promoter company M&M, MHRIL intends to finance expansion of its resorts in Coorg, Ooty and Ashtamudi, and for setting up new ones in Tungi and Theog. However, MHRIL is being priced at a ‘considerable’ premium to the other listed hospitality players, who already have premium properties. Nonetheless, we believe that the good reputation enjoyed by the promoter group, justifies the premium valuation for the company to an extent, and hence we expect the IPO to be received well in the primary market. Also, in a pre-IPO placement that was done in February 2008, State Bank of India (SBI) and Jacob Ballas picked up 3% stake in the company at Rs479/share, which had valued MHRIL at $1bn. On the lower and upper end of the IPO price band, the stock would quote at 15.2x and 17.9x its post diluted FY2011E Earnings. On the basis of our workings on profits earned per member, we have arrived at a value of Rs2,494cr for the business, which translates into a per share value of Rs296. Hence, we recommend a Subscribe on the IPO albeit at the lower end of the price band. Assumptions in our model: 1) Average revenue per member of Rs2,25,000; 2) Estimated capex of Rs34,200 to be made per member addition; 3) Marketing costs of Rs75,000/new member, and 4) Cost of providing service for the next 25 years Rs63,925/new member.

Source: Company RHP, Angel Research; * At Lower end of the Price Band

9

Document info
Document views33
Page views33
Page last viewedThu Dec 08 02:43:38 UTC 2016
Pages13
Paragraphs725
Words5810

Comments