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I have done some research into AHUN.N as I brought this at 90.40. This is my first time publishing something like this so this may be completely wrong. And please correct me if I'm wrong. So here we go.
I have collected data from financial statements available from June 2009
Note that all figures in Millions and rounded to the nearest integer.
Comparison of results between 2010 & 2009
The drop in profitability in June quarter is evident from results as far as from 2008. This maybe due to low tourist arrivals in summer season. But overall we can see that profitability has gone up. And AHUN has expanded it's portfolio of hotels in the past year.
Trailing PE calculation
Profits attributable to Equity Holders
419+18+152+272 = 861 Million
Weighted average Shares
38.4X3/12 + 48 X 6/12 + 336 X 3/12 = 117.6 million
So EPS as per accounting Standers using weighted average
861/117.6 = 7.32
Using current shares of 336 million
EPS would be 861/336 = 2.56
Using the latest closing price of Rs.91.20
Accounting PE (91.20/7.32) = 12.46
Normal PE (91.20/2.56) = 35.63
Expected Earnings
With the growth of overall tourism sector and considering the peak tourist arrivals in March quarter it would be safe to assume that we can see at least 20% growth in March 2010 quarter with respect to March 2009 results.
So Expected Profits = 419 X 120% = 503
With this expected earnings for FY 2010/2011
18+152+272+503 = 945
This is a 80% growth compared to last year.
Weighted average shares
48 X 6/12 +336 X 6/12 = 192
Accounting EPS = 945/192 = 4.92
Corresponding PE ration (91.20/4.92) = 18.53
Normal EPS (945/336) = 2.81
Corresponding PE ration (91.20/2.81) = 32.45
Technical Analysis
I'm not a master of Technical Analysis but yesterday AHUN has formed a pattern called "MORNING STAR" Pattern. This is a bullish reversal Indication. And also note that the MACD has crossed over and volumes are growing. Is this a start of a Bullish run from AHUN? If so what will be the upper limit for this counter?
Summery
Experts what is a suitable PE ratio for Hotel industry?
According to CSE, Hotel and Travel sector has a PE ration of around 100. And Most of the resorts that are similar to AHUN has PE around 40~50.
Is this share overvalued at the current price? What will be the future of AHUN?
I have collected data from financial statements available from June 2009
Note that all figures in Millions and rounded to the nearest integer.
FY 2009/2010 | Q4 March 2010 | Q1 June 2010 | Q2 Sep 2010 | Q3 Dec 2010 | |
Revenue | 7,326 | 2,416 | 1,514 | 1,783 | 2,076 |
Oprating Prof. | 1,152 | 698 | 5 | 195 | 351 |
Net Profit to Equity Holders | 523 | 419 | 18 | 152 | 272 |
NA | 5189 | 5189 | 7585 | 8292 | 8549 |
Shares | 38.4 | 38.4 | 48 | 48 | 336 |
Comparison of results between 2010 & 2009
Q1 June | Q2 September | Q3 December | Q4 March | |
2009/2010 | (114) | 8.5 | 210 | 419 |
2010/2011 | 18 | 152 | 272 | N/A |
Change % | 220% | 160% | 30% | N/A |
The drop in profitability in June quarter is evident from results as far as from 2008. This maybe due to low tourist arrivals in summer season. But overall we can see that profitability has gone up. And AHUN has expanded it's portfolio of hotels in the past year.
Trailing PE calculation
Profits attributable to Equity Holders
419+18+152+272 = 861 Million
Weighted average Shares
38.4X3/12 + 48 X 6/12 + 336 X 3/12 = 117.6 million
So EPS as per accounting Standers using weighted average
861/117.6 = 7.32
Using current shares of 336 million
EPS would be 861/336 = 2.56
Using the latest closing price of Rs.91.20
Accounting PE (91.20/7.32) = 12.46
Normal PE (91.20/2.56) = 35.63
Expected Earnings
With the growth of overall tourism sector and considering the peak tourist arrivals in March quarter it would be safe to assume that we can see at least 20% growth in March 2010 quarter with respect to March 2009 results.
So Expected Profits = 419 X 120% = 503
With this expected earnings for FY 2010/2011
18+152+272+503 = 945
This is a 80% growth compared to last year.
Weighted average shares
48 X 6/12 +336 X 6/12 = 192
Accounting EPS = 945/192 = 4.92
Corresponding PE ration (91.20/4.92) = 18.53
Normal EPS (945/336) = 2.81
Corresponding PE ration (91.20/2.81) = 32.45
Technical Analysis
I'm not a master of Technical Analysis but yesterday AHUN has formed a pattern called "MORNING STAR" Pattern. This is a bullish reversal Indication. And also note that the MACD has crossed over and volumes are growing. Is this a start of a Bullish run from AHUN? If so what will be the upper limit for this counter?
Summery
Accounting | Normal | |
Trialling PE | 12.46 | 35.63 |
Expected PE | 18.53 | 32.45 |
Experts what is a suitable PE ratio for Hotel industry?
According to CSE, Hotel and Travel sector has a PE ration of around 100. And Most of the resorts that are similar to AHUN has PE around 40~50.
Is this share overvalued at the current price? What will be the future of AHUN?
