Sunday, September 2, 2012

Hospitality Brand name Hotel properties Limited

Hotel Properties Limited operates hotel s and retail units. They also are into property development projects. The company was started in January 1980. Over the span of 20 years the company emerged as a lifestyle company from a property company. The Group has around 19 hotels with nearly 4,000 rooms in 8 countries. This company primarily deals in the development of luxurious residential properties in Singapore. HPL also holds property development stakes. The current share price of HPL is S$1.99 and is aiming to a price of S$2.75. With the global portfolio of residential properties and hotels, its current market value of just the hotels in Singapore is worth $$4.58 per share or may be more than twice its current share price. 

By the end of December, 2011 the group achieved a revenue of $493.8 million. This is 11.7% greater than the last year’s record which was $442.1 million.

Current scenario: Hotel properties Ltd.  hotels and resorts are located in the prime districts of Singapore, Thailand, Malaysia, Indonesia, Maldives, Seychelles, Bhutan, Tanzania and Czech Republic. The company has won several awards for their residential projects and hotels. Also they have awards for their designs. In 2011, the company paid a dividend of 2 cents per ordinary share of the company and a special dividend of 3 cents. This was totaling to $25, 286, 00 in respect of the financial year by the end of December 2010.The group provides number of hotel management service in the region. It also has rental and sales operations on completed residential properties and commercial units. 

Future scope: Hotel properties Ltd. Has plans to expand their business to new locations. HPL’s three hotels which are in Singapore result for 33% of its estimated FY12 EBIT. This is only from the hotel operations. HPL has new tourism infrastructure which would help Singapore rank as a world – class travel destination. The expectation of visitor arrivals in 2012 is to reach a record of 14.2 m. This would in return increase the tourism receipts reaching to S$24 billion. As per the property consultancy in Singapore, a total of 10,971 hotel rooms would be added to Singapore hotel, of which 2,301 rooms will be added to the orchard Road area. This would in return add up to 32% increase to the existing hotel supply in this area.  

Hotel properties Ltd. Is now planning to take up existing hotels and start business with them. Due to this the cost would be minimal in development and also it would not impact the economy much. It should not have a large impact on the existing supply.
HPL plans to reevaluate their existing assets. Two of its hotels Hilton Singapore and Four seasons Orchard Boulevard itself sum up to S$1.47 per share and translating to 75% of the current share value. 

Conclusion: The hotel and resort sectors are expected to contribute strongly to the Group’s operating margin despite higher inflation and the strengthening of the Singapore dollar may post challenges ahead.

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