The brokerage expects industry tailwinds and key initiatives, especially the growth of its five owned iconic hotels and medium-term portfolio expansion, to help sustain revenue and earnings growth momentum.
BOFA Securities mentioned that the company’s lower net debt position is a positive and that its current valuation, at 20 times estimated EBITDA for financial year 2026-27, remains attractive.The brokerage estimates a compound annual growth rate (CAGR) of 12% for revenue and 14% for EBITDA, with earnings expected to grow over 90% during FY24-25 to FY27-28, albeit on a low base.
However, risks include a potential downturn in the hospitality cycle, revenue concentration, deterioration in brand reputation, and execution or competitive challenges.
Meanwhile, Morgan Stanley also initiated coverage on Schloss Bangalore with an ‘Overweight’ rating and a price target of ₹549 per share.
The brokerage said that its ‘Overweight’ rating is driven by a higher-for-longer upcycle, strong demand for luxury experiences, iconic assets with a low net debt position, and attractive valuation.According to the brokerage, a steady execution can drive re-rating but concentration risk is a key to watch.
Morgan Stanley expects annual EBITDA growth of 12% through FY26-27, and a nine-fold increase in net income as interest costs decline.
The company’s balance sheet is now nearly net-debt-free, enabling it to fund its next capital expenditure cycle through free cash flows.
Schloss Bangalore made its stock market debut on June 2, making a weak debut after listing at nearly 7% discount on the exchanges.
Established on March 20, 2019, Schloss Bangalore is a luxury hospitality company operating under “The Leela” brand in India. It owns, operates, manages, and develops luxury hotels and resorts, offering premier accommodations and personalised services inspired by Indian hospitality.
As of May 2024, the company operates 12 properties with 3,382 keys under The Leela Palaces, Hotels, and Resorts.
Five of these — located in Bengaluru, Chennai, New Delhi, Jaipur, and Udaipur — are wholly owned.
For the fiscal ended on March 31, 2025, the company posted a profit of ₹47.66 crore and a revenue of ₹1,406.56 crore. Earlier, the firm posted a net loss of ₹2.13 crore and a revenue of ₹1,226.50 crore for FY24.
