Why Are Hotel Stocks Rallying? - Chart Of The Day 20 April 2018 - Equitymaster

Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2019 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.

Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks


Login Failure
(Please do not use this option on a public machine)
  Sign Up | Forgot Password?  

Why Are Hotel Stocks Rallying?
Apr 20, 2018

For the last several weeks, Sarvajeet and I have been discussing hotel stocks.

There is a very interesting trend happening in the hotel industry right now. It has caused the recent rally in hotel stocks. Most of these stocks are making life-time highs.

To dig a little deeper. we pulled out data on hotel occupancy across the country.

The occupancy rate (number of rooms utilised/ the total rooms available), peaked in 2007-08 and started declining.

The declining occupancy led to the poor health of hotel industry. Lower occupancy lead to lower profitability.

However, over the last few years there hasn't been much addition capacity and the occupancy rate now is inching towards its previous peak of 2007-08.

The current rally in the stocks is on the hope that the occupancy levels will inch up further and the hotel industry will start making good profits.

The Smart Money Secrets team recently met a hotel company to understand the situation in detail.

But we won't be recommending it anytime soon as it did not make it through our Smart Money Score.

Data Source: HVS Research

This Chart Of The Day was published in The 5 Minute WrapUp - Dhoni or Kohli: Who Would Be the Man of the Market?

Equitymaster requests your view! Post a comment on "Why Are Hotel Stocks Rallying?". Click here!


Our Most Popular Charts

Get the Indian Stock Market's
Most Profitable Ideas

How To Beat Sensex Guide 2019
Get our special report, How to Beat Sensex Nearly 3X Now!
We will never sell or rent your email id.
Please read our Terms