EIH Ltd

EIH Ltd, which runs hotels and resorts under the brand name of ‘Oberoi’ and ‘Trident’ has done very well for Q1FY16. Its net profit for the quarter has shown a massive rise – from Rs.6 crore in previous Q1 to Rs.20 crore in current Q1; an over three times rise. This jump was mainly on account of sale of its property in Darjeeling and West Bengal. This is shown as exceptional income at Rs.11 crore. But for this, net profit would have come in at Rs.9 core, which would have been a 50% rise, which in itself is pretty credible.

Compared to the jump in net profit, net sales rise of 6% at Rs.299 crore seems very small.  Established in 1934, Oberoi Group operates 30 hotels, a Nile Cruiser and a Motor Vessel in the backwaters of Kerala. The Group has presence in six countries and is also engaged in flight catering, airport restaurants, travel and tour services, car rentals, project management and corporate air charters. As at 30th June 2015, promoters stake is at Rs.35.25%, FIIs hold 3.03% and DIIs who have been consistently hiking their stake in the company, currently hold 13.14%. Interestingly, Mukesh Ambani’s Reliance Industrial Investments has a 18.53% stake and ITC holds 14.98% - this is over and above the promoters stake.