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Nomura Initiates 'Buy' Ratings for ITC Hotels and IHCL

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  Published in Stocks and Investing on Saturday, January 17th 2026 at 20:47 GMT by Zee Business
      Locale: INDIA

New Delhi, January 18th, 2026 - Investment firm Nomura has commenced coverage on two major players in India's hospitality sector, ITC Hotels and Indian Hotels Company (IHCL), issuing "Buy" ratings and establishing price targets suggesting significant growth potential. This move signals a positive outlook for the industry as a whole, reflecting expectations of a continued and robust recovery following pandemic-era disruptions.

Nomura's initiation of coverage arrives at a pivotal moment for Indian hospitality. The sector, significantly impacted by travel restrictions and reduced tourism over the past few years, has been gradually rebounding. Nomura's report points to improving occupancy rates and a strong recovery in Average Revenue Per Available Room (RevPAR) as key indicators supporting their optimistic assessment. RevPAR, a crucial metric for hotel profitability, combines occupancy rates and average room rates, offering a comprehensive view of performance.

ITC Hotels: A Strong 'Buy' with INR360 Target

The brokerage has assigned a 'Buy' rating to ITC Hotels, setting a target price of INR360 per share. This target implies a substantial potential upside for investors, suggesting Nomura anticipates considerable stock appreciation. ITC Hotels, known for its diverse portfolio of luxury hotels and resorts across India, has consistently demonstrated resilience. Their integrated business model, extending beyond hospitality into sectors like FMCG and Paperboards, has likely contributed to this perceived stability, providing a buffer against sector-specific volatility.

Nomura's assessment likely considers ITC Hotels' ongoing expansion plans, including new property developments and potential acquisitions, as well as its focus on operational efficiency and enhancing guest experiences. The company's brand recognition and established customer loyalty are also expected to play a crucial role in sustaining its growth trajectory.

Indian Hotels Company (IHCL): Sharing the Positive Outlook with INR350 Target

Mirroring the sentiment surrounding ITC Hotels, Nomura also rates Indian Hotels Company (IHCL) as a 'Buy,' with a target price of INR350. IHCL, the owner of the iconic Taj Hotels Resorts and Palaces, is another cornerstone of the Indian luxury hospitality landscape. Like ITC Hotels, IHCL has been actively working to modernize its properties and adapt to evolving traveler preferences. The 'Buy' rating and target price suggest Nomura believes IHCL is well-positioned to leverage the recovering travel demand and command premium pricing.

IHCL's recent efforts towards sustainable tourism practices and embracing digital technologies in guest services are also likely factors contributing to Nomura's positive assessment. Furthermore, the company's focus on strategic partnerships and collaborations might also be bolstering investor confidence.

Sectoral Recovery and Future Prospects

Nomura's decision to initiate coverage is a clear endorsement of the overall recovery within the Indian hospitality sector. The brokerage's analysts believe that the industry has navigated the worst of the crisis and is now entering a period of sustained growth. This recovery is fueled by both domestic and international tourism, with a particularly strong rebound observed in certain segments like luxury travel and experiential tourism.

Looking ahead, several factors are expected to continue driving the sector's performance. These include a burgeoning middle class with increased disposable income, rising corporate travel, and the government's initiatives to promote tourism. However, potential headwinds such as global economic uncertainties and fluctuating fuel prices remain a cause for cautious optimism.

Investor Advisory

Nomura advises investors to carefully review the full report for a comprehensive understanding of the rationale behind these recommendations and to conduct their own due diligence before making investment decisions. While the 'Buy' ratings suggest a positive outlook, market conditions can change, and inherent risks are associated with any investment in the stock market. The full report contains detailed financial analysis, competitive landscape assessment, and risk factors that investors should consider. This includes assessment of macroeconomic factors influencing the Indian economy and their potential impacts on the hospitality sector.