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Leela Palaces Hotels Share Price: Shares of Leela Palaces Hotels and Resorts Ltd closed slightly higher on Wednesday even as broader markets slipped, after ICICI Securities initiated coverage on the luxury hospitality company with a Buy rating, pointing to its premium brand positioning and a strong growth pipeline.

The stock settled at Rs 415, up 0.21 per cent, at 3:41 pm on December 17. The benchmark Nifty 50 ended the session at 25,818.55, down 0.16 per cent or 41.55 points. Leela Palaces’ market capitalisation stood at around Rs 13,700 crore.

In its initiation note, ICICI Securities set a target price of Rs 600, implying an upside of nearly 45 per cent from the latest close. The brokerage valued the hotels business at 22 times EV/Ebitda based on December 2027 estimates, while assigning a 1x price-to-book multiple to the company’s investments in BKC, Mumbai, and Dubai.

The brokerage expects Leela Palaces to post a revenue CAGR of 16 per cent and an Ebitda CAGR of 17 per cent between FY25 and FY28, supported by steady same-store performance and additions from its upcoming properties.

Leela currently operates 14 luxury hotels with 4,090 keys, including 1,761 owned rooms, making it one of the largest pure-play luxury hotel operators in the country. ICICI Securities noted that in FY25, the company’s owned portfolio delivered average room rates and RevPAR about 1.4 times higher than the broader luxury hotel industry.

With supply additions in the luxury segment remaining limited, especially in tier-1 cities, the brokerage believes the demand-supply balance remains favourable. According to industry estimates, luxury hotel demand is likely to grow at a 13.7 per cent CAGR between FY25 and FY28, outpacing supply growth of 8.8 per cent, which should continue to support pricing.

Leela Palace Hotels expansion plans aim to increase its operational inventory to over 5,000 keys by FY30, backed by a pipeline of six owned hotels with 763 keys and three managed properties with 283 keys. The company is also working on asset upgrades and new revenue streams, including Leela luxury residences and the ARQ invite-only members club.

ICICI Securities also highlighted the company’s improving balance sheet. Following its June 2025 IPO, which raised Rs 25 billion, Leela repaid Rs 23 billion of debt and spent Rs 3.7 billion on capital expenditure in the first half of FY26. Net debt is expected to decline to around Rs 8 billion by March 2026, translating into a net debt-to-equity ratio of about 0.1x, giving the company financial flexibility for future growth.