Why I'm Bullish on Hotel Stocks

Nov 9, 2021

Brijesh Bhatia, Research analyst

Despite the recent volatility, the stock markets are still in a bullish trend.

As long as the trend is up, you should be looking for the best stocks to invest in.

In this video, I'll show you why I think you should consider hotel stocks for short term trading.

I believe these stocks are breaking out and could see a good amount of upside in the short term.

Watch the video and let me know your thoughts. I would love to hear from you.

Hello viewers. Welcome to the Fast Profits Daily. Myself Brijesh Bhatia.

In this video, we'll be discussing one sector which is coming out of the covid bubble. It is the one of the most I would say affected due to the covid.

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So we have created and equal weighted hotel index. The stocks which has a marketcap of minimum of Rs 1,000 crores as on the closing of eight of November. So if you look at the stocks, the stocks are Indian Hotels, EIH, Chalet Hotels, Lemon Tree, Westlife Developers, Mahindra Holidays, ITDC, and Taj GVK.

 

So if you look at the first chart over here, this is the weekly chart of the equal weighted hotel index which we created. November 2019 highs I would say the pre covid levels, again in the March 2020 we have seen all of the indices, all of the market seen a down trend and this was the one which was affected the most and underperformed against the other sectors or the Nifty.

But now, if you look at the right hand side of the charts, the index it broke out of the November 2019 highs and gaining this strong momentum.

So if you look at the two purple lines over here on your screen, they ware as a resistance, we saw a breakout, the retest happened, and now the resistance are acting as a support levels for the hotel index over here and we have seen a momentum on the positive side.

So I would say, if you look at it, things are for tourism now opening out, we are witnessing for last 6-7 months, people are going out, booking the hotels and if you look at the Diwali festival, the bookings were full for most of the hotels into the tourism. Again, this is very, very positive if you look at technical structure of the hotel stocks, the equal weighted hotel index which we created.

 

If I just look at the daily chart over here and from weekly moving to the daily, it has broken out of cup and handle structure over here. The cup and handle structure is again a bullish structure. We broke out retested, forming the cup again, or the rounding structure around the retest levels on the right hand side, indicating this is coming out of the huge resistance level. The retest happened, and again, a positive momentum could happen.

I believe not only Diwali, probably Christmas as well, we might see in the New Year as well, we might see the bookings might happen very on a stronger side, looking at the technical structure of hotel stocks.

Again, I believe this is the one sector when should look for 30 to 45 days momentum and I believe 15% to 20% upside can be expected on this equal weighted index which we have created for the hotel stocks.

So stay invested. I still believe markets are very, very bullish, though some hiccups could be expected and we recorded a Nifty view. In case you haven't seen that video, do watch that video as well.

Signing off. Before a sign off I would request you to comment on how you like this video and what do you expect from the hotel stocks? And you do believe that the tourism will definitely see an uptrend, or it will look for again the levels on through the downtrend? Do comment on the comment section below.

Signing off. Brijesh Bhatia.

Warm regards,

Brijesh Bhatia
Brijesh Bhatia
Research Analyst, Fast Profit Report
Equitymaster Agora Research Private Limited (Research Analyst)

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