Tata Group stock with 740% returns hits 52-week high, overbought on charts; is the upside capped?

Shares of Indian Hotels Company Ltd hit their 52-week high on Tuesday amid a rally in the broader market. Indian Hotels shares rose to a high of Rs 831, rising 1.25% in the current session against the previous close of Rs 820.75. Market cap of the Tata Group firm rose to Rs 1.18 lakh crore.

The stock trades in the overbought zone with its RSI at 72. An RSI above 70 signals that a stock is overbought on charts.

The stock has gained 16% in a month. The rally in the stock can be attributed to stellar Q2 FY27 financial earnings and an upgraded full-year growth forecast.

Indian Hotels stock has gained 47% from its 52 week low of Rs 565.25.

The stock reached a record high of Rs 894.90 on December 30, 2024. It has clocked multibagger returns of 111% in three years and gained 321% in five years.

Indian Hotels share price targets 

ICICI Securities has price target of Rs 990 on the stock.

The brokerage said sustained asset upgradation, better RevPAR growth and improving international
performance should drive 200 bps margin expansion to 35% by FY29E.

"In view of strong industry tailwinds, we recommend Buy with revised price target of Rs 990," said ICICI Securities.

The brokerage said any unforeseen event domestic/global event can impact the room demand or delay in new launches can affect the overall growth.

Elara Capital has a buy call on the stock with a target price of Rs 922.

"We have raised IH’s FY27E/28E/29E revenue estimates by 3%/11%/11% and EBITDA estimates by  8%/17%/17% respectively. We revise Indian Hotels to Buy (from Accumulate) with a higher TP of Rs 922  (Rs 786 earlier) based on SoTP as we roll forward valuations to H1FY29 E estimates," said the brokerage.

Brokerage Anand Rathi has a by call on the stock with a revised target price of Rs 900. "

Factoring in strong quarterly performance, we raise our EBITDA estimate by 5.1/ 2.9% for FY27/28e and introduce FY29 estimates. Accordingly, we maintain BUY rating on the stock with a revised TP of Rs900 (from Rs 845 earlier), valuing it at 23.5x FY29e EBITDA (vs. 26x FY28 EBITDA previously)," said Anand Rathi.

MOFSL is also bullish on the Indian Hotels stock.

The brokerage is optimistic on growth outlook despite near-term geopolitical and macroeconomic uncertainties, led by healthy traction in the core business as well as new and reimagined businesses.

"We expect the strong momentum to continue in the medium term, led by: 1) a strong room addition pipeline in owned/management hotels (6,650/28,150 rooms), 2) strategic acquisitions, 3) continued favorable demand-supply dynamics, and 4) increasing MICE activities in India. We broadly maintain our FY27/FY28 EBITDA estimates and reiterate BUY with our SoTP-based target price of Rs 870," said MOFSL.

Axis Securities has a buy call on the stock with a target price of Rs 900 against the earlier target of Rs 830.

The brokerage said the company's management remains highly confident about H2FY27, supported by a strong domestic consumption cycle, a packed schedule of MICE/corporate events, and 30 planned new hotel openings.

"The full-year revenue growth guidance upgrade to 15-17% factors in ongoing ARR expansion and market share gains in top-tier cities. While TajSats airline catering remains pressured by global disruptions affecting air travel, IHCL's diversified revenue streams and rapidly expanding select-service portfolio are poised to drive sustained, double-digit earnings growth and cash generation," said Axis Securities.