On February 5, 2025, ITC Hotels Ltd was removed from the BSE Sensex and 22 other BSE indices prior to market opening. As a result, the stock price rose to ₹167.05, up by ₹2.40 or 1.46 per cent at 11.09 am on the BSE.
Before the announcement, the hotel chain’s shares had seen a 4.16 per cent decline, leading to significant selling pressure. Index funds have offloaded shares worth over ₹400 crore, with an additional ₹700 crore in selling expected following its anticipated removal from the NSE Nifty.
ITC Hotels recently demerged from ITC Ltd and listed on January 29, 2025, at ₹180 on NSE and ₹188 on BSE, marking a 31 per cent discount from its implied price of ₹260. Under the demerger structure, ITC retained a 40 per cent stake, while 60 per cent was distributed to ITC shareholders in a 10:1 ratio.
Despite challenging market conditions, ITC Hotels has shown strong operational metrics. Its Average Room Rate increased from ₹7,900 in FY19 to ₹12,000 in FY24, representing a CAGR of 8.7 per cent. Revenue Per Available Room also improved from ₹5,200 to ₹8,200 during the same period.
The company’s market valuation has decreased from ₹39,126.02 crore at listing to ₹34,266.48 crore. Room sales contribute 52 per cent of total revenue, with food and beverage accounting for 40 per cent.
