Hotel Leela on a good run

Hotel Leela seems to be having a good run today morning. The stock is up over 4.5% at Rs.18.25 woth some two times jump in volumes. Its 52-week high stands at Rs.24.10 and low at Rs.16.55.

Nowadays the only reason why Hotel Leela goes up is when it announces some asset sale, which means it is working on its strategy to go asset light and thereby bring down its debt. Its debt currently stands at around Rs.4500 crore.

Today too, the reason is another property sale. News is that it plans to sell its 3.85 acre land in Hyderabad’s Banjara Hill. This sale is expected to bring in around Rs.150 crore. This is the same property on which the company hopes to build another luxury hotel, which never took off.

The company has made a corporate presentation yesterday and in that document it has spelt out its current status on various projects. It is developing a 250-room property near Bengaluru airport, a hotel-cum-branded residences in Chandigarh, a 58-villa resort in Jaipur and a 175-room luxury hotel in Kathmandu. It has also signed an agreement with Qatar’s Al Faisal Group to sell the 6.5 acre land near the Taj Mahal and on this land two hotels will come up, both to managed by Hotel Leela, entailing a combined investment of Rs.500 crore.

A 100-room Leela Palace and a 150-room Aiana Hotel will come up on that land..Leela would only be managing the property which would see a combined investment of Rs 500 crore.