ITC Hotels, IHCL gain 2% in subdued market; brokerages see more upside

ITC Hotels, IHCL stocks in limelight: Demand for luxury hotels will sustain in India with strong demand from domestic leisure travel and anticipated higher foreign tourist arrivals in H2FY26.

ITC Hotels, Indian Hotels share price today

 

Shares of ITC Hotels (₹239.60) and Indian Hotels Company (IHCL) (₹790.75) rallied 2 per cent each on the BSE in Wednesday’s intra-day trade in an otherwise subdued market on the back of healthy business outlook. The correction in these stocks up to 12 per cent from their respective recent highs provided a good entry opportunity, believe analysts. In comparison, the BSE Sensex was down 0.15 per cent at 81,518 at 09:30 AM.

 

The stock price of ITC Hotels had hit a record high of ₹261.35 on July 21, 2025, while, IHCL stock touched all-time high of ₹894.15 on December 30, 2024.  READ STOCK MARKET LATEST UPDATES LIVE

 

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Indian hospitality and tourism industry

 

India’s hospitality and tourism industry continues on a strong growth path, supported by rising travel demand, increasing domestic consumption, and sustained investment in infrastructure and services. 

 

The tourism sector is also gaining traction, with revenues projected to exceed $59 billion by CY 2028. Key drivers include growth in domestic travel, improvement in foreign tourist arrivals, and demand from corporate and event based tourism. The Union Budget 2025-26 has allocated ₹2,541.06 crore for tourism development, focusing on infrastructure, skill-building, and facilitation. A major initiative includes developing 50 tourist destinations in collaboration with states, aimed at improving visitor experience and connectivity.

 

Meanwhile, the hotel sector outlook for Q2FY26 remains positive, supported by a lineup of events and seasonal demand drivers across India. A cluster of long weekends in August (Raksha Bandhan, Independence Day, Janmashtami, and Ganesh Chaturthi) is likely to support leisure travel across leisure destinations. The brokerage firm expects double-digit growth in RevPAR (Revenue per Available Room) for Q2, driven by ARR (Average Room Rate).  ALSO READ | Hindustan Aeronautics shares rise 4%; check out reason and recommendation

Brokerages see more upside in ITC Hotels, Indian Hotels

 

Analysts at ICICI Securities recommend a ‘Buy’ rating on ITC Hotels with a target price of ₹282 per share. Demand for luxury hotels will sustain in India with strong demand from domestic leisure travel and higher demand from higher foreign tourist arrivals in H2FY26. Hence, the brokerage firm expects double digit RevPar growth momentum to sustain with occupancy ratio expected to improve by 100-200bps while ARR to grow by 8-10 per cent.

 

Its first international property – ITC Ratnadipa, Sri Lanka (352 rooms) which was launched in FY25, will incrementally add to the room revenues. Room revenues are expected to grow at compounded annual growth rate (CAGR) of 12 per cent over FY25-28E. The company derives ~40 per cent of its revenues from Food & Beverages (F&B) business, highest amongst the listed peers with F&B revenue contribution of 13-35 per cent. F&B business revenues are expected to grow at a CAGR of 19 per cent over FY25-28E, analysts said.

 

Despite a high base in July, driven by five wedding nights last year, the Q2FY26 outlook of IHCL remains strong. Management anticipates robust performance in August and September. The company expects double-digit revenue growth in FY26 for its hotels segment, driven by meetings, incentives, conferences, and exhibitions (MICE) activity and continued inflow of high-profile international delegates, Motilal Oswal Financial Services said in the Q1 result update.

 

The brokerage firm expects the strong momentum to continue in the medium term, led by a strong room addition pipeline in owned/management hotels (3,770/16,430 rooms), continued favorable demand-supply dynamics, and increasing MICE activities in India. It reiterated its 'Buy' rating on IHCL with SoTP-based target price of ₹900.