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Check Before You Invest : Ras Resorts & Apart Hotels Ltd

BSE: 507966 NSE: ISIN: INE651D01016
  |   Sector:  Travel & Hospitality   |   Industry:  Hotel, Resort & Restaurants

Snapshot

Q.1 Which industry/sub-sector does Ras Resorts & Apart Hotels Ltd belong to?
Ras Resorts & Apart Hotels Ltd belongs to the Travel & Hospitality sector, operating specifically within the Hotel, Resort & Restaurants segment.
Q.2 Is Ras Resorts & Apart Hotels Ltd a good quality company?
Ras Resorts & Apart Hotels Ltd is a quality company, based on a multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is Ras Resorts & Apart Hotels Ltd undervalued or overvalued?
Ras Resorts & Apart Hotels Ltd appears Fair, as its key valuation ratios are in line with their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios Current 5-year
Historic Median
Price to Earnings 42.62 49.28
Price to Book 2.45 2.14
Price to Sales 1.64 1.38
EV to EBITDA 14.56 14.37
Q.4 Is Ras Resorts & Apart Hotels Ltd a good buy now?
Ras Resorts & Apart Hotels Ltd is not a good buy now, based on weak price trend analysis suggesting prices may fall. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

  • How has it performed on generating Profits?

    By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.

  • How efficiently has it utilized Capital?

    By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.

  • How is it managing its Debt?

    By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of Ras Resorts & Apart Hotels Ltd?
Ras Resorts & Apart Hotels Ltd revenue growth is -1.1% for FY-2025, which is below its 5-year CAGR of 7.82%, indicating slower growth.

Q.2 Gross Profit margin of Ras Resorts & Apart Hotels Ltd?
Ras Resorts & Apart Hotels Ltd Gross profit margin which is the profit after deduction of direct costs, is 7.8% for FY-2025, which is above its 5-year median of 6.4%, indicating increasing margins.

Q.3 Operating Profit Margin of Ras Resorts & Apart Hotels Ltd?
Ras Resorts & Apart Hotels Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 9.81% for FY-2025, which is in line with its 5-year median of 9.81% indicating stable margins.

Q.4 Net Profit Margin of Ras Resorts & Apart Hotels Ltd?
Ras Resorts & Apart Hotels Ltd Net Profit Margin is 2.52% for FY-2025, is above its 5-year median of 1.4%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 7.8 6.4
Operating Profit Margin (%) 9.81 9.81
Net Profit Margin (%) 2.52 1.4

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Ras Resorts & Apart Hotels Ltd?
Ras Resorts & Apart Hotels Ltd Return on Asset is 1.07%, which is above its 5-year historical median of 0.5%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Ras Resorts & Apart Hotels Ltd?
Ras Resorts & Apart Hotels Ltd Return on capital employed is 8.24% for FY-2025, which is above its 5-year historical median of 6.61%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Q.7 Return on Equity (ROE) of Ras Resorts & Apart Hotels Ltd?
Ras Resorts & Apart Hotels Ltd Return on equity is 4.3% for FY-2025, which is above its 5-year historical median of 2.38%, indicating the business is making better use of its shareholders capital.

Q.8 Cash conversion cycle of Ras Resorts & Apart Hotels Ltd?
Ras Resorts & Apart Hotels Ltd Cash conversion cycle is -17 days, in line with its 5-year historical median of -17 days, indicating stable working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.42 0.37
ROE (%) 4.3 2.38
ROCE (%) 8.24 6.61
Cash Conversion Cycle -17 days -17 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of Ras Resorts & Apart Hotels Ltd?
Ras Resorts & Apart Hotels Ltd Debt-to-Equity ratio is 0.52, which is above the industry average of 0.06, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Ras Resorts & Apart Hotels Ltd?
Ras Resorts & Apart Hotels Ltd Debt to cash flow from operations is 3.2, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Ras Resorts & Apart Hotels Ltd?

Q.1 Promoter shareholding and pledge status of Ras Resorts & Apart Hotels Ltd?
Promoters hold 74.34% of the Ras Resorts & Apart Hotels Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Ras Resorts & Apart Hotels Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Ras Resorts & Apart Hotels Ltd vs industry peers?
Ras Resorts & Apart Hotels Ltd revenue CAGR is 7.82%, compared to the industry median CAGR of 3.58%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) -1.1 3.6
Gross Profit Growth (%) 20.2 15.6
Operating Profit Growth (%) 0.8 13.5
Net Profit Growth (%) 83.3 18.8
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.42 0.27
ROE (%) 4.3 2.92
ROCE (%) 8.24 6.09
Cash Conversion Cycle (days) -17.22 -

Valuation & price assessment

Q.1 Stock return of Ras Resorts & Apart Hotels Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 7.4% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
7.4% 19.7% 16.6% 19.4%
Q.2 Valuation ratios of Ras Resorts & Apart Hotels Ltd vs historical?
The current P/E ratio of 42.62 is lower than its historical median of 49.28, indicating that the stock is trading below its historical average valuation.
Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?
Valuation Ratios Current 5-year
Historic Median
5-year
Industry Median
Price to Earnings 42.62 49.28 32.28
Price to Book 2.45 2.14 1.81
Price to Sales 1.64 1.38 5.80
EV to EBITDA 14.56 14.37 17.25

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