Ventive Hospitality: Rs 790 target; FY25 EBITDA 1,012 cr

Choice Institutional starts coverage with a BUY call

Choice Institutional Equities has initiated coverage on Ventive Hospitality Ltd with a BUY rating and a target price of Rs 790. The brokerage said the target implies a 36.9% upside from the prevailing market price at the time of its note. The initiation thesis is built around Ventive’s luxury-focused hotel portfolio, an expansion pipeline that targets a sharp increase in room inventory, and a sizeable annuity-style leased commercial portfolio. Choice also flagged the company’s ownership and operating structure as a differentiator, with Panchshil Group’s development capabilities and Blackstone’s institutional backing and governance. The note positions Ventive as a platform that is scaling beyond its core markets in Pune and the Maldives. It also highlights new growth in India and Sri Lanka through a mix of development and acquisitions.

Portfolio platform anchored by Panchshil and Blackstone

Ventive started as the hospitality division of the Panchshil Group, with Blackstone joining as a joint venture partner in 2017. One report in the provided material states Panchshil holds a 60% stake while Blackstone owns 40%. The platform’s portfolio is concentrated in luxury and upper upscale hotels operated by global brands. Properties cited across the material include JW Marriott and The Ritz-Carlton in Pune, and Conrad, Anantara, and Raaya by Atmosphere in the Maldives, alongside other Marriott- and Hilton-affiliated hotels in Pune and Bengaluru. Choice describes Ventive as “highly acquisitive,” pointing to takeovers such as Hilton Goa Resort and Soho Hospitality India as evidence of a planned push into luxury and lifestyle segments. The coverage note also references Ventive’s partnerships with leading hotel brands as a source of distribution and brand depth.

Expansion plan: doubling keys to 4,000+ by FY30E

A core part of Choice’s argument is the pace of capacity addition. The brokerage note says Ventive plans to double keys from 2,036 in FY25 to 4,000+ by FY30E. The material also references 367 keys under development, with projects in Varanasi, Bengaluru, and Sri Lanka to be operated or franchised by Marriott. Separately, Ventive has announced a partnership with Marriott International for seven luxury and upscale hotels in India and Sri Lanka, adding 1,548 rooms to its portfolio. Locations cited include Varanasi, Mundra, Navi Mumbai, Pune, and Pottuvil in Sri Lanka. Another company description in the text says Ventive has 13 fully operational hotels with 2,178 rooms and is expanding with seven new hospitality projects in India and Sri Lanka, with some projects to be developed by promoter-group entities and later transferred under ROFO or a similar arrangement.

Three growth levers outlined by the brokerage

Choice breaks Ventive’s next phase into three levers. First is micro-market-led upside across Pune, Navi Mumbai, Maldives, and Sri Lanka, supported by commercial absorption, connectivity upgrades, and muted luxury supply. In that section, the brokerage expects ADR and RevPAR ramp-up at about 7.1% and 5.2% CAGR, respectively, over FY26E to FY29E. Second is faster scaling of non-room revenue at about 26.7% CAGR over FY26E to FY29E, linked to F&B, MICE, Soho House membership fees, and branded villas. Third is stable annuity cash flows from a grade-A leased portfolio of about 3.4 million sq ft, with an average lease tenure of about 2.7 years and about a 15% step-up on renewal. This combination is presented as a way to reduce reliance on room revenue alone and to improve resilience through the cycle.

Margin outlook and capital allocation plan

Choice expects a period of margin expansion driven by operating leverage and a mix shift. The note projects EBITDA margin expansion of about 290 basis points to 47.5% over FY26E to FY29E. It also mentions IPO-related deleveraging of Rs 1,400 crore, which is expected to lower interest costs by about Rs 15-20 crore per year and support better PAT-to-free-cash-flow conversion. The brokerage references a pipeline of Rs 3,700 crore and says select brownfield opportunities are expected to be largely funded through internal cash generation, limiting incremental financing needs. Choice also expects Revenue and adjusted EBITDA to grow at a CAGR of 17.3% and 17.0% over FY26E to FY29E, driven by key additions, RevPAR growth, scaling non-room revenue, and stable annuity cash flows.

IPO and funding context mentioned in filings and reports

Multiple IPO-related details are included in the material. One section says Ventive is preparing to file IPO documents to raise Rs 2,000 crore, with no secondary sale by Blackstone or Panchshil. Another section says an IPO to raise Rs 1,600 crore is set to open on Friday and close next Tuesday, with a price band of Rs 610-643 per share and an employee reservation of shares worth Rs 1 crore. Separately, another report says the company secured SEBI approval for a proposed Rs 2,000 crore IPO. Across these references, the stated use of proceeds includes expanding the hospitality portfolio and repaying certain borrowings. A prospectus-based reference also mentions intent to repay debt of Rs 1,600 crore.

FY25 performance: revenue tops Rs 2,000 crore

Ventive reported consolidated results for Q4 and the full year ended March 31, 2025. In Q4 FY25, consolidated revenue was Rs 717.2 crore, up 20% year on year. In the same quarter, the hospitality portfolio generated revenue of Rs 584 crore, up 26% year on year, with hospitality EBITDA of Rs 270 crore and an EBITDA margin of 46%. For FY25, consolidated revenue was Rs 2,160 crore, up 13% year on year, while EBITDA was Rs 1,012 crore, up 16% year on year, with an EBITDA margin of 47%. The hospitality business reported FY25 revenue of Rs 1,604 crore, up 17%, and EBITDA of Rs 553 crore, up 34%, with an EBITDA margin of 34.5%. Management linked the quarter’s performance to higher ADR and occupancy, supported by MICE and weddings.

Demand indicators: ADR, occupancy, RevPAR, TRevPAR

Operational metrics in the material point to strength in pricing and utilization. In Q4, ADR increased 16% year on year in India and 5% overall, while overall occupancy rose to 71%. RevPAR in Q4 grew 11% year on year to Rs 19,249, with the India portfolio at Rs 8,940, up 24% year on year. TRevPAR in Q4 stood at Rs 31,837, up 16%, with India TRevPAR at Rs 16,531, up 25%. For the full year, consolidated ADR was Rs 20,769, up 4%, while Indian properties reported ADR of Rs 11,076, up 10%. Full-year occupancy was 64%, consolidated RevPAR was Rs 13,293 (up 12%), and overall TRevPAR was Rs 22,981 (up 14%).

Market impact: what investors are being asked to focus on

Choice’s target and valuation framework place emphasis on forward earnings and asset segmentation. The brokerage values the business on an FY28E SOTP and applies a 16.0x multiple to hospitality adjusted EBITDA. It also frames the investment case around room inventory growth, RevPAR improvement, and a stronger contribution from non-room revenues. In parallel, the leased commercial portfolio is treated as a stabilizer, with high committed occupancy referenced at 95.55% as of September-end in one section of the provided material. Alongside operating momentum, planned deleveraging and lower interest costs are positioned as supports for cash flows. The note’s emphasis on internal funding for a Rs 3,700 crore pipeline is also relevant for investors tracking balance sheet risk during expansion.

Key numbers at a glance

Conclusion: execution and funding discipline are central

Choice Institutional Equities’ BUY call on Ventive Hospitality is tied to a combination of expansion, operating leverage, and a mixed revenue base. The company’s FY25 results show higher revenue and EBITDA, alongside improved pricing and occupancy indicators. The forward plan described across the material includes doubling keys to 4,000+ by FY30E, expanding into new destinations in India and Sri Lanka, and building non-room income streams. On funding, the brokerage’s note highlights post-IPO deleveraging of Rs 1,400 crore and an expectation of largely internal funding for a Rs 3,700 crore pipeline, with lower interest costs of about Rs 15-20 crore per year. The next set of milestones for investors to track, based on the provided text, include progress on under-development keys, integration of acquisitions, and updates related to the company’s public market fundraising and deployment plans.