Multibagger small-cap stock: Shares of Kamat Hotels (India) climbed 11% in today’s intraday trade, March 7, reaching ₹314.90 apiece, moving closer to its 1-year high of ₹318.75, after the company signed a management agreement to manage and operate the 54-room Orchid Hotel in Rishikesh, Uttarakhand.
“The hotel shall feature approximately 54 elegantly designed rooms with facilities such as a state-of-the-art high-end spa, a swimming pool, a modern recreational center, a dedicated yoga center, a fully equipped conference room, an exquisite 24-hour all-day dining restaurant, and a mountain-view bar, among others,” the company stated in its exchange filing today.
The hotel is expected to commence operations by July 2025. Mr Vishal Kamat, Executive Director, confirmed that the hotel is expected to be fully operational by then. Dr Vithal Kamat, Chairman & Managing Director, stated, “This will enhance our presence in Uttarakhand’s hospitality sector with the second Orchid Hotel opening here. The first hotel was signed in Dehradun.”
Earlier, in mid-February, the company signed a management agreement for the operation of the Orchid Hotel located in Mandavi, Kutch District, Gujarat. This hotel will offer approximately 153 well-appointed rooms and villas, designed to provide a luxurious and comfortable stay.
Kamat Hotels’ shares have been buzzing on Dalal Street for quite some time now, driven by multiple positive developments.
The company operates hotels across various categories, from luxury to value-for-money segments, with a diverse brand portfolio that includes premium brands like The Orchid, Fort JadhavGadh, and Mahodadhi Palace, as well as mid-premium brands like Lotus Resorts and IRA by Orchid.
To expand its presence, the company primarily employs a combination of leased properties, revenue-sharing agreements, and management contracts.
Stock up over 2,100% in 5 years
The company’s shares have delivered phenomenal returns to shareholders in a very short period, growing from ₹14 to the current trading price of ₹311, resulting in a staggering 2,121% growth over a five-year period.
During this time, the stock ended two calendar years—CY22 and CY23—with multibagger returns of 105% and 173%, respectively. In January 2024, the shares recorded a new all-time high of ₹372 apiece.
Going forward, the company aims to drive topline growth by executing new projects in the pipeline while simultaneously enhancing unit-level operational efficiency by optimizing electricity, labor, and operating expenses. Additionally, the company plans to expand its brand portfolio and strengthen its presence across the country to capture a larger market share.
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