ABSTRACT
Fast-Mover Midcap Fund follows an active investing strategy where it trades stocks based on expected performance in six to twelve months. The fund's research team has selected two stocks from the hotel industry, Oaktree Hotels and Serenity Hotels ( Exhibit 34.1 ). As a research analyst working with the fund, your task is to recommend only one hotel stock to the fund manager. Comparative Profit and Loss Statements of Two Hotel Companies
|
Rs Crore |
Oaktree Hotels |
Serenity Hotels |
|---|---|---|
|
Revenues |
200.0 |
46.0 |
|
Food and Beverage Expenses |
20.0 |
5.0 |
|
Employee Benefit Expenses |
50.0 |
8.0 |
|
Depreciation and Amortisation |
25.0 |
7.0 |
|
Other Expenses |
75.0 |
11.0 |
|
Total Operating Expenses |
170.0 |
31.0 |
|
EBIT |
30.0 |
15.0 |
|
Interest |
15.0 |
- |
|
EBT |
15.0 |
15.0 |
|
Tax (25%) |
3.8 |
3.8 |
|
Profit after Tax |
11.3 |
11.3 |
|
Number of Shares |
2.4 |
2.8 |
|
Earnings per Share |
4.7 |
4.0 |
|
P/E |
19.2 |
19.6 |
|
Share Price |
90.0 |
78.8 |
