An Assignment

ON

“Stock Price Analysis of ASIAN HOTELS”

SUBMITTED TO: SUBMITTED BY: PROF. SUSMITA SARKAR Pradeep SinghaFINANCE FACULTY PGDMA-1135DSBS

Dayananda Sagar Business School

Shivage Malleshwara Hills Kumaraswamy Layout,

Bangalore, Karnataka 560078 Company Profile:-

The Company was incorporated as Asian Hotels Limited (the Company) under the Companies

Act, 1956, on 13th November, 1980, as a Public Limited Company. It was promoted by Mr. R.K.

Jatia, Mr. R.S. Saraf and Late Mr. Chaman Lal Gupta, three Non-resident Indians together

with Mr. Shiv Jatia and Mr. Sushil Gupta, their Indian associates. 

On incorporation, the immediate object of the Company was to set up a five star deluxe hotel of

international standards in Delhi. Hence Hyatt Regency Delhi came into existence. After soft

opening in 1982 for the Asian Games, it became fully operational in the year 1983. Later the

Company set up two more five star deluxe hotels - at Mumbai and Kolkata. While Hyatt

Regency Kolkata was operational effective 1st January, 2003, Hyatt Regency

Mumbai commenced operations effective 1st April, 2003. 

In 2010, through a Scheme of Arrangement and De-merger sanctioned by the High Court of

Delhi vide Order dated 13th January, 2010, the Mumbai Undertaking and Kolkata Undertaking

of the Company primarily comprising Hyatt Regency Mumbai and Hyatt Regency Kolkata

respectively, were transferred to and vested in two separate companies with effect from 31st

October, 2009. 

Consequently, post de-merger the Company, now known as Asian Hotels (North) Limited, has

only one operational property namely Hyatt Regency Delhi. 

In August 2010, after due regulatory notifications, the main promoter groups namely the R. K.

Jatia & Shiv Jatia Group, Gupta Group and Saraf Group transferred their respective shareholding

inter-se in the three de-merged entities. Resultantly, the R. K. Jatia & Shiv Jatia Group acquired

shares held in the Company by the other two promoter groups named above. 

In October 2010, the Company made a strategic investment by acquiring majority stake

in Fineline Hospitality & Consultancy Pvt. Ltd., Mauritius; and through its subsidiaries namely

Most Prof Hospitality & Consultancy Pvt. Ltd., Mauritius and Lexon Ventures Pte. Ltd., BVI

acquired a controlling interest in Magus Estates and Hotels Limited, which owns and operates

“Four Seasons” hotel in Mumbai. 

Presently the Company, in addition to expanding its existing facilities, is in the process of

constructing a new tower, comprising of serviced apartments and commercial space as part of the

expansion at Hyatt Regency Delhi.

They operate three 5 star deluxe category hotels. Locations: Delhi, Mumbai & Kolkata.

They operate the Hyatt Regency brand on the above three locations.

Address:-

Asian Hotels (North) Limited

Hotel Hyatt Regency Delhi

Bhikaiji Cama Place,

M. G. Marg, New Delhi - 110066, India

Telephone (Hotel Operator): +91-11-26791234

Fax : +91-11-26791033

Website :  www.asianhotelsnorth.com

Date Opening Price

Highest Price

Lowest Price Closing Price Volume

08/11/2012 190.35 193.90 189.35 193.90 340

09/11/2012 190.00 192.90 185.00 192.50 609

12/11/2012 185.15 189.95 185.00 189.95 26

13/11/2012 189.95 189.95 189.95 189.95 00

15/11/2012 188.85 188.85 181.00 181.10 432

16/11/2012 190.00 190.00 180.55 181.00 377

19/11/2012 181.00 185.65 181.00 181.00 18

20/11/2012 181.00 181.00 177.95 179.95 1157

21/11/2012 176.00 177.95 175.00 175.15 254

22/11/2012 175.35 179.90 175.35 176.40 16

23/11/2012 176.00 179.50 175.55 179.50 255

26/11/2012 175.10 183.95 172.30 172.30 86

27/11/2012 179.00 179.00 171.00 174.80 1028

29/11/2012 177.00 177.00 172.00 177.00 30

30/11/2012 175.00 175.50 172.50 175.00 227

03/12/2012 176.00 179.00 176.00 178.60 146

04/12/2012 179.90 179.90 179.90 179.90 22

05/12/2012 176.00 182.95 174.00 182.95 144

06/12/2012 185.00 185.00 185.00 185.00 3

07/12/2012 178.00 178.00 176.70 177.85 792

Stock Share Price:-

Graph:-

1- Volume

8/11/2

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9/11/2

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12/11/2

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13/11/2

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30/11/2

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3/12/2

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4/12/2

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5/12/2

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6/12/2

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7/12/2

0120

200

400

600

800

1000

1200

1400

Volume

Volume

2- Opening Price and Closing Price

8/11/2

012

9/11/2

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12/11/2

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3/12/2

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7/12/2

012160

165

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175

180

185

190

195

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OP. PriceClo. Price

3- Highest Price and Lowest Price

8-Nov

10-Nov

12-Nov

14-Nov

16-Nov

18-Nov

20-Nov

22-Nov

24-Nov

26-Nov

28-Nov

30-Nov

2-Dec

4-Dec

6-Dec

155

160

165

170

175

180

185

190

195

200

H. PriceL. Price

4- Graph as per Opening, Closing, High Price, Lowest Price.

8/11/2

012

9/11/2

012

12/11/2

012

13/11/2

012

15/11/2

012

16/11/2

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19/11/2

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6/12/2

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7/12/2

012155

160

165

170

175

180

185

190

195

200

OpeningCloseing Low.PriceHig.Price

Analysis:-

The stock is still undervalued based on the following logics

The three hotels i.e. at Delhi, Mumbai & Kolkata will get listed separately. So a

shareholder holding 3 shares of Asian Hotels currently will get 1 share each of each of

the separate entity.

Since long Asian Hotels hasn’t expanded its hotel base. It is said that there were conflicts

between the promoters and hence the company wasn’t aggressive. With the demerger, the

negative synergy should be remove

The unlocking of the hidden value for the current shareholders can be expected with this

demerger.

The hotel sector is also recovering with the upturn in the economy. Going by the latest

newspaper headlines, occupancies are back to 85% though ARRs are still 10-20% below

normal peak levels. Hotels stocks are still down more than 50% below the crash levels.

Asian Hotels is one of the most aggressive company of the existing 3. I expect the stock

to list at 175+ openings price

If anyone had invested to take benefit, he should book profits above these levels.