Apeejay Surrendra Park Hotels shares: Should you book profit after 21% listing gain?

Shares of Apeejay Surrendra Park Hotels Ltd were holding up morning gains, even as the broader market was trading in the red. The stock was up 19.35 per cent at Rs 185 on BSE, off its day's high of Rs 193.15. This is against a 0.35 per cent drop in shares of Indian Hotels Co Ltd and 3.15 per cent fall in Lemon Tree Hotels Ltd.

Shivani Nyati, Head of Wealth, Swastika Investmart said that the listing pop signifies strong investor confidence in the well-established hotel chain's future prospects, whose occupancy rates are high and expansion plans suggest future growth possibilities. "The listing paints a hopeful picture for ASPHL, but a cautious approach is still advised. Those who want to book profit may exit their holdings at prevailing levels. Those who want to hold for the stock for long term may keep a stop loss at Rs 168," Nyati said.

Apeejay Surrendra Park operates 30 hotels, which are spread across different categories such as luxury boutique upscale, and upper midscale in cities such as Mumbai, Goa, Bangalore, Chennai, New Delhi and Hyderabad. It offered 2,298 rooms, at the end of January 2024. Apeejay Surrendra Park also offers retail food and beverage services through 73 ‘Flurys' outlets.

Prashanth Tapse, Senior VP (Research), Mehta Equities said that given the momentum in the stock market and announcements in the Interim Budget  that suggested promotion of the hospitality and tourism industry, hotel sector may outperform in coming years.

"Apeejay Surrendra Park Hotels is well placed in all metros to tap the tourism demand.  We believe the healthy listing is justified on the back of reasonable valuations when compared to its peers followed by government push towards hospitality and tourism industry. Its primary objective of reducing the debt could lighten interest burdens that can improve bottom line in coming years. Hence, we recommend allotted investors to “hold” with a long-term perspective. For non allottees, one can accumulate more on dips post listing and look to hold for a long term like 3-5 years’ time horizon,” Tapse said.

Earlier today Apeejay Surrendra Park Hotels shares listed at a premium of 20.65 per cent at Rs 187 against the IPO price of Rs 155 per share on BSE.

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