What is the best stock to buy from Hotel sector?

What is the best stock to buy from Hotel sector?

Discuss.....................................

Renuka city hotel, with only one hotel to its name, it seems to be performing well.

There are few hotel is CSE which are at a loss
May be not few, but little more than few.......

Marawila looks very attractive at these levels....

@ccsentha: you have started some good discussions recently. However, it would be most beneficial if you can also post some of your own analysis as well.

http://forum.srilankaequity.com/sta/ccsentha

I see so many questions but very little contribution of your own. Just my opinion.

Cheers!

anubis wrote:@ccsentha: you have started some good discussions recently. However, it would be most beneficial if you can also post some of your own analysis as well.

http://forum.srilankaequity.com/sta/ccsentha

I see so many questions but very little contribution of your own. Just my opinion.

Cheers!

Yes CCsentha, I would also like to see more of your opinions. Posting questions is okay, but also share your ideas and knowledge as it will be beneficial to others as well okay. Just a request.

ccsentha wrote:What is the best stock to buy from Hotel sector?

Discuss.....................................

I have no doubt ccsentha. That is RENU.

kam2011 wrote:

ccsentha wrote:What is the best stock to buy from Hotel sector?

Discuss.....................................

I have no doubt ccsentha. That is RENU.

For your reference, the value of RENU invested listed in companies only excluding all other assets


Therefor, if we include other assets and it's hotel operation, RENU is much worth than current price.

Monster wrote:

kam2011 wrote:

ccsentha wrote:What is the best stock to buy from Hotel sector?

Discuss.....................................

I have no doubt ccsentha. That is RENU.

For your reference, the value of RENU invested listed in companies only excluding all other assets


Therefor, if we include other assets and it's hotel operation, RENU is much worth than current price.

Thanks.
Even if we take only core business RENU is trading at near top of the pack compared to EPS and PE in its sector.

Monster,
In the above calculation do you see anything peculiar about SIRA cost of investment?

Also am wondering why they are keeping these 100-1000 share lots. just for fun

Wait RENU will give you the massive profits to you small shareholders after selling those.
http://forum.srilankaequity.com/t15357-renu-going-down-and-down

May be they'll give you, the shareholders, a loan to buy a Maruti at 5% interest rate.

slstock wrote:

Monster,
In the above calculation do you see anything peculiar about SIRA cost of investment?

Also am wondering why they are keeping these 100-1000 share lots. just for fun

Thanks slstock. That's the cost in 2010. I forgot update it. I apologize.
Cost in 2011,
SIRA ---> 92,934/-
RICH --> 11,074,603/-

aj,
I agree. Loan given to the Australian company is a concern. But still it's worth at this price.

Can you suggest us, in which company we can invest in CSE. As of your comments, it looks like we cannot invest in any company in Colombo Stock Exchange.

aj wrote:Wait RENU will give you the massive profits to you small shareholders after selling those.
http://forum.srilankaequity.com/t15357-renu-going-down-and-down

May be they'll give you, the shareholders, a loan to buy a Maruti at 5% interest rate.

I guess RENU might not be a stock to hold for a very long time. Yes, am not sure they made the best use of a 325 Million fund at a low return. But if this is a Aus$ transaction there might be some benefit there also which ofcourse might not be direct to minor holders.


But if we really look deep , we can find some fault in any stock. If that will be the case we might not be able to buy anything at all ever, right?

WHatever said, we have seen RENU NAv goes up little by little and the share price dripping due to bear.

Note Parent company is still a private company which consist more than 60% of RENU shares.

Monster wrote:

kam2011 wrote:

ccsentha wrote:What is the best stock to buy from Hotel sector?

Discuss.....................................

I have no doubt ccsentha. That is RENU.

For your reference, the value of RENU invested listed in companies only excluding all other assets


Therefor, if we include other assets and it's hotel operation, RENU is much worth than current price.

RENU has 7 million DFCC shares,and RENU share volume is also 7 million,that means for each RENU Share we bought, we have indirectly bought one DFCC share.

WildBear wrote:
RENU has 7 million DFCC shares,and RENU share volume is also 7 million,that means for each RENU Share we bought, we have indirectly bought one DFCC share.

Good point WildBear. If you look at their portfolio, they have invested more than 50% on DFCC. We have noticed RENU and CABO are increasing their stake in DFCC in the recent past.

WildBear wrote:
RENU has 7 million DFCC shares,and RENU share volume is also 7 million,that means for each RENU Share we bought, we have indirectly bought one DFCC share.

Talking about the portfolio of companies such as these are the same as talking about the private jewellery and money in the safes in the homes the owners of the company. You don't own anything.

To give you an example. this is like owning the wallet of the RENU director. The wallet will have lots of 2000/- notes. You own part of it. But the thing is the RENU directors use the money for whatever they want the money for. They will spend the money to buy a Maruti or they may give the money as loan to their relatives at next to nothing interest. You just own the wallet. They use the money.

I think this is a very good discussion on RENU. Members have so far made effort to assess it's investment (on shares)value. While I am agreable with all facts stated on value of investment of this company I would like to invite your attention to the huge growth of revenue from it's core business.Pl. see following figures:(Values given in Rs. mln)

Year...... Revenue. Gross profit. Other income... PBT....... Net Profit.......... EPS(Rs)
2006...... 94.3...... 84.3...........111.1.............. 119.6...........115.3..... 16.48
2007...... 80.5...... 72.1...... ....483.1.............. 510.1...........504.1..... 72.02
2008...... 81.4...... 73.9...........105.8.............. 134.2............83.3...... 11.91
2009...... 71.1...... 63.1...........134.1.............. 132.4...........106.1..... 15.16
2010...... 80.6...... 66.1...........187.2............. 217.1...........194.5..... 27.79
2011...... 99.2...... 81.2...........177.4.............. 179.5...........171.7..... 24.54
2012(9... 136.8.....126.5..........279.1..............360.8...........354.8..... 50.71
months)

According to above figures Core business revenue and gross profit has gone up tremendouesly during first 9 months of 2011/2012 financial tear.And therefore they have recorded the highest ESP of Rs. 50.70 after 2008. RENU has undertaken a large refurbishment programme during this year and they had plans to increase 20 new rooms as well. I guess RENU has already completed it's refurbishment plan and hence revenue has increased significantly.We can expect further increase in income duringthe next few years also.

These are only my views and anybody interested in this company need to have his/her own assesment. before invest.

Thanks Raja.

aj wrote:

WildBear wrote:
RENU has 7 million DFCC shares,and RENU share volume is also 7 million,that means for each RENU Share we bought, we have indirectly bought one DFCC share.

Talking about the portfolio of companies such as these are the same as talking about the private jewellery and money in the safes in the homes the owners of the company. You don't own anything.

To give you an example. this is like owning the wallet of the RENU director. The wallet will have lots of 2000/- notes. You own part of it. But the thing is the RENU directors use the money for whatever they want the money for. They will spend the money to buy a Maruti or they may give the money as loan to their relatives at next to nothing interest. You just own the wallet. They use the money.

You have some valid arguement. These family owned businesses and companies with one controlling shareholder have this problem.we saw how they ride on minor shareholders during some transactions accrued in LFIN,RCL,HAYL,LCEY etc.
By the way if you are interested in a single share in CSE please let us know or even PM me.

WildBear wrote:

aj wrote:

WildBear wrote:
RENU has 7 million DFCC shares,and RENU share volume is also 7 million,that means for each RENU Share we bought, we have indirectly bought one DFCC share.

Talking about the portfolio of companies such as these are the same as talking about the private jewellery and money in the safes in the homes the owners of the company. You don't own anything.

To give you an example. this is like owning the wallet of the RENU director. The wallet will have lots of 2000/- notes. You own part of it. But the thing is the RENU directors use the money for whatever they want the money for. They will spend the money to buy a Maruti or they may give the money as loan to their relatives at next to nothing interest. You just own the wallet. They use the money.

You have some valid arguement. These family owned businesses and companies with one controlling shareholder have this problem.we saw how they ride on minor shareholders during some transactions accrued in LFIN,RCL,HAYL,LCEY etc.
By the way if you are interested in a single share in CSE please let us know or even PM me.

I cannot see RENU ownership like that. they seems to be running it in a proper manner.

aj wrote:

WildBear wrote:
RENU has 7 million DFCC shares,and RENU share volume is also 7 million,that means for each RENU Share we bought, we have indirectly bought one DFCC share.

Talking about the portfolio of companies such as these are the same as talking about the private jewellery and money in the safes in the homes the owners of the company. You don't own anything.

To give you an example. this is like owning the wallet of the RENU director. The wallet will have lots of 2000/- notes. You own part of it. But the thing is the RENU directors use the money for whatever they want the money for. They will spend the money to buy a Maruti or they may give the money as loan to their relatives at next to nothing interest. You just own the wallet. They use the money.

No i don't see it like that.

AUD has been increasing for ever. and its predicted to go up further. So in long term this would turn out to be a good move by RENU management. They would be able to gain in a lot with the increase of AUD exchange rate. They might not need to pay tax for this as its in AUD, isn't it? (If it's in AUD)

If you see their core business activity income it has been increasing and we can expect it to increase further in coming years with the expansion plan.

Their cash reserves and cash balance seems to be increasing over the years. It looks they have cash in abundance.

its RENU,wow this worth......

http://www.cse.lk/cmt/upload_report_file/569_1329215298198.pdf


as at 31/12/2011

Net Assets Per Share 278.90

EPS-9 months- 50.70Rs

So what is the order of best hotels?

No.1 is RENU - popular choice of the forum members
No.2 ????

Main thing i see is RENU is not only in the Hotel Sector and with many other core business... will be the great advantage...see the figures given by raja...above

ccsentha , other good hotels in my watch list are Pegasus,Amaya and Hunas Falls.These hotels are running with a rreasonable profits. But you have to study their performance and future plans deeply.