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Check Before You Invest : Sayaji Hotels Ltd

BSE: 523710 NSE: SAYAJIHOTL ISIN: INE318C01014
  |   Sector:  Travel & Hospitality   |   Industry:  Hotel, Resort & Restaurants

Snapshot

Q.1 Which industry/sub-sector does Sayaji Hotels Ltd belong to?
Sayaji Hotels Ltd belongs to the Travel & Hospitality sector, operating specifically within the Hotel, Resort & Restaurants segment.
Q.2 Is Sayaji Hotels Ltd a good quality company?
Sayaji Hotels Ltd is a average quality company, based on a somewhat consistent 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 Sayaji Hotels Ltd undervalued or overvalued?
Sayaji Hotels Ltd appears Somewhat overvalued, as its key valuation ratios are higher than 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 180.68 27.58
Price to Book 8.88 8.30
Price to Sales 3.36 3.35
EV to EBITDA 13.44 10.62
Q.4 Is Sayaji Hotels Ltd a good buy now?
Sayaji 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 Sayaji Hotels Ltd?
Sayaji Hotels Ltd revenue growth is 23.7% for FY-2025, which is above its 5-year CAGR of -7.99%, indicating faster growth.

Q.2 Gross Profit margin of Sayaji Hotels Ltd?
Sayaji Hotels Ltd Gross profit margin which is the profit after deduction of direct costs, is 20.5% for FY-2025, which is below its 5-year median of 30.9%, indicating decreasing margins.

Q.3 Operating Profit Margin of Sayaji Hotels Ltd?
Sayaji Hotels Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 25.63% for FY-2025, which is below its 5-year median of 29.03% indicating decreasing margins.

Q.4 Net Profit Margin of Sayaji Hotels Ltd?
Sayaji Hotels Ltd Net Profit Margin is 7.38% for FY-2025, is below its 5-year median of 16.3%, indicating decreasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 20.5 30.9
Operating Profit Margin (%) 25.63 29.03
Net Profit Margin (%) 7.38 16.3

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Sayaji Hotels Ltd?
Sayaji Hotels Ltd Return on Asset is 6.1%, which is below its 5-year historical median of 10.27%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Sayaji Hotels Ltd?
Sayaji Hotels Ltd Return on capital employed is 35.02% for FY-2025, which is in line with its 5-year historical median of 35.02%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 14%, indicating value creation.

Q.7 Return on Equity (ROE) of Sayaji Hotels Ltd?
Sayaji Hotels Ltd Return on equity is 19.96% for FY-2025, which is in line with its 5-year historical median of 19.96%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of Sayaji Hotels Ltd?
Sayaji Hotels Ltd Cash conversion cycle is 14 days, above its 5-year historical median of 11 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.83 0.68
ROE (%) 19.96 19.96
ROCE (%) 35.02 35.02
Cash Conversion Cycle 14 days 11 days

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

Q.9 Debt to Equity ratio of Sayaji Hotels Ltd?
Sayaji Hotels Ltd Debt-to-Equity ratio is 0.57, 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 Sayaji Hotels Ltd?
Sayaji Hotels Ltd Debt to cash flow from operations is 1.13, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Sayaji Hotels Ltd?

Q.1 Promoter shareholding and pledge status of Sayaji Hotels Ltd?
Promoters hold 66.82% of the Sayaji Hotels Ltd, with 2.56% of their stake pledged, indicating low pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Sayaji Hotels Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Sayaji Hotels Ltd vs industry peers?
Sayaji Hotels Ltd revenue CAGR is -7.99%, compared to the industry median CAGR of 3.58%, indicating slower growth and losing its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 23.7 3.6
Gross Profit Growth (%) -17.7 15.6
Operating Profit Growth (%) -5.4 13.5
Net Profit Growth (%) -44.4 18.8
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.83 0.27
ROE (%) 19.96 2.92
ROCE (%) 35.02 6.09
Cash Conversion Cycle (days) 14.38 -

Valuation & price assessment

Q.1 Stock return of Sayaji Hotels Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 8% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
8% 7.5% -6.5% 1.1%
Q.2 Valuation ratios of Sayaji Hotels Ltd vs historical?
The current P/E ratio of 180.68 is higher than its historical median of 27.58, indicating that the stock is trading above 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 180.68 27.58 32.28
Price to Book 8.88 8.30 1.81
Price to Sales 3.36 3.35 5.80
EV to EBITDA 13.44 10.62 17.25

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