# TajGVK Hotels shares: Stock down 26% in 1 year, but Monarch sees 49% upside - Here's why | Check share price target — retained record
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source: [news](https://highsignal.app/data/news) (news:india-mint-markets) published 2026-10-06 11:59 ingested 2026-10-07 02:57
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Shares of Taj GVK Hotels & Resorts, renamed Krishna GVK, could see a sharp re-rating as the company enters a new expansion phase, according to Monarch Network Capital (MNCL) Research. The brokerage initiated coverage on the stock with a BUY rating and a target price of ₹475, implying an upside of around 49% from last traded price of ₹319.
The brokerage's investment case rests on a combination of strong occupancy at the company's existing hotels, scope for higher room rates, the consolidation of Taj Santacruz in Mumbai and the upcoming Taj Yelahanka property in Bengaluru.
Monarch Research said the company was moving from a period of limited owned-asset additions into a fresh growth cycle, with its existing portfolio providing a strong base for earnings growth.
“TAJGVK offers a differentiated combination of ownership of scarce luxury hotel assets and access to the Taj operating platform. Its existing portfolio operates at high occupancy, particularly in Hyderabad, limiting further occupancy-led growth,” Monarch Research said.
Monarch has valued the company at 8x FY29E EV/EBITDA to arrive at its ₹475 target price. The brokerage said the company's low leverage and strong earnings growth justify the valuation.
“Given TAJGVK’s robust earnings growth and low leverage, we believe a discount of more than 10–15% to large-cap peer multiples would be excessive. Accordingly, we assign a target multiple of 8x EV/EBITDA to our FY29E estimates,” it noted.
The hotel stock has remained under pressure in recent months. In today’s trade, however, it gained more than 1.5% to hit an intraday high of ₹320 per share on the BSE. Despite the recovery, the stock was still around 27% below its 52-week high of ₹438.85, which it had touched in December last year. On the downside, the stock hit its 52-week low of ₹281.85 in March 2026.
The recent performance has been weak across most time frames. The hotel stock has declined more than 4% over the past one month and around 7% in the last three months. Over a six-month period, the decline was relatively limited at around 1%, while the stock has lost nearly 26% over the past year.
Despite the recent correction, the stock has delivered strong returns over the longer term. It has surged around 126% in the past five years, making it a multibagger for investors who have held the stock through the period.
A key part of the investment thesis is the company's strong presence in Hyderabad. TAJGVK operates three luxury hotels in the city — Taj Krishna, Taj Deccan and Vivanta Hyderabad — with 597 keys. The brokerage estimates that these properties account for around 42% of Hyderabad's luxury hotel inventory.
Occupancy at the three properties stood at 78%, 81% and 83%, respectively, providing limited scope for significant volume-led growth. Instead, Monarch expects higher average room rates (ARR), refurbishment and premiumisation to drive RevPAR and earnings.
The brokerage estimates ARR to grow at a 12.7% CAGR between FY26 and FY29E. Hyderabad's expanding GCC, IT, pharmaceutical and MICE ecosystem, along with improving airport traffic, is expected to support demand for premium hotels.
The next major catalyst is the company's expansion beyond Hyderabad. Taj Yelahanka, a 256-key luxury hotel in North Bengaluru, is expected to commence operations in H2FY27. Monarch said the project would provide a second earnings engine for the company.
“The company’s earnings profile is set to change materially from FY27E with the consolidation of Taj Santacruz and commissioning of the 256-key Taj Yelahanka in Bengaluru. While Taj Santacruz provides an immediate uplift to the reported earnings base,” the brokerage said.
The brokerage also highlighted TajGVK's increased ownership in Taj Santacruz. After raising its stake to 51%, the Mumbai property will be fully consolidated from Q1FY27, providing a significant step-up in reported revenue and EBITDA.
Monarch expects the combination of higher ARR, improving occupancy, Taj Santacruz consolidation and Bengaluru expansion to drive a significant improvement in financial performance.
“We forecast TAJGVK’s revenue and EPS to grow at 26.4% and 15.4% CAGR, respectively, over FY26–FY29E. Basis our estimates, the stock trades at 9.4x FY27E and 6.6x FY28E EV/EBITDA,” Monarch Research said.
The brokerage noted that larger hospitality peers trade at around 14–15x FY28E consensus EV/EBITDA, while TAJGVK's expected return metrics and earnings growth support a narrower valuation discount.
However, the brokerage's key risks include a slower-than-expected ramp-up of new properties, project execution delays, weaker ARR or occupancy growth and the company's dependence on Hyderabad.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
Pranati Deva is a seasoned financial journalist with over a decade of experience in high-pressure newsroom environments, currently working as a Senior Sub Editor at LiveMint. Over the years, she has developed a reputation for sharp editorial judgement, a strong grasp of market dynamics, and the ability to translate complex financial developments into clear, engaging stories for a wide audience.
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