Espire Hospitality Limited

Consumer Cyclical — Resorts & Casinos · BSE

₹143.00₹0.00 (0.00%)

DalalBaazaar Score

58 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

High

Driven by high debt relative to equity, negative free cash flow, micro-cap size, which brings thin liquidity.

In simple words: Strong business and financial position, with both sales and profits growing well. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:53 pm

Understanding the Business

Company site ↗

The 60-second version of Espire Hospitality Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Espire Hospitality Limited engages in the hospitality business in India. The company also operates, manages, develops, renovates and promotes hotels/resorts and provides related services under the Country Inn, Six Senses, and the Zana brand names.

IndustryResorts & Casinos

SectorConsumer Cyclical

Employees571

Annual revenue₹130 Cr

How does it make money?

Turns over ₹130 Cr a year. Of every ₹100 of sales, about ₹6 reaches shareholders as profit, with ₹26 left at the operating level before interest, tax and depreciation. Each of its 571 employees supports ₹22.7 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹22.7 lakh

Who are its competitors?

The closest listed comparisons in its industry are MARUTI SUZUKI INDIA LTD., TITAN COMPANY LIMITED, TRENT LTD, AVENUE SUPERMARTS LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of 11.6% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

Peer median ROE25.9%

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +628% while net margin moved +295% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+628%

Margin effect+295%

DalalBaazaar Score

58/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Debt/Equity of 2.76x is high — earnings must service borrowings before shareholders see anything
✓ Current ratio of 1.86 — short-term bills are well covered
✗ Free cash flow is negative — growth is being funded by borrowing or fresh equity
✗ Interest cover of only 2.2x — little room if profits dip
✗ Debt has grown 99.8% a year — worth checking what it bought

Quality vs. Valuation

Company Quality

58/ 100

Average

How good the business is, ignoring the share price entirely.

Valuation

77/ 100

Cheap

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

20.9x

3Y Median

117.5x

40 monthly readings · mean 238.9x · range 26.3x–1016.8x

Sector Median

69.2x

median of 4 sector peers

🟢Current valuation is approximately 82% below its 3y median of 117.5x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

🟢Against its sector it trades 70% below the peer median of 69.2x.

vs. its own history

Cheap

117.5x median over 40 months · -82%

vs. sector peers

Cheap

69.2x median of 4 peers · -70%

vs. generic bands

Fair

15x–35x

EV/EBITDA

10.7x

PEG

0.10

What's Good / What's Bad

🟢 What's Going Well3

Margins are improving
EBITDA margin is up from 20.5% to 25.5% over 3 years.
Return on capital is rising
ROCE has improved from 6.4% to 11.6%.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Return on equity is falling
ROE has dropped from 37.5% to 15.9% — each rupee of shareholder capital earns less than it did.

Red Flags

3 items require attention · 3 high

🔴Debt has risen sharplyFinancial
Total debt is up 698% over 3 years, from ₹18 Cr to ₹141 Cr.
🔴High leverageFinancial
Debt/Equity of 2.76x — earnings must service borrowings before shareholders see anything.
🔴Free cash flow negative for 4 yearsFinancial
The business has not covered its capital spending from operations for several years running, which has to be funded externally.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 20.5% to 25.5%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Priced below its own history
The stock trades 82% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Cheaper than its peers
It trades 70% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

The debt load needs earnings to hold up
Debt is 4.3x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Returns on shareholder capital are falling
ROE has dropped from 37.5% to 15.9%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.
Earnings are hard to forecast
Profit has swung sharply from year to year, so any single year — good or bad — is a weak guide to the next. Cyclical earnings deserve lower multiples for that reason.
Size brings its own risk
Micro Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.
Several serious flags at once
3 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 70% a year✓ 93.8% CAGR
Latest reported year was 17.8%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 24%✓ 25.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA falls below 3x✗ 4.3x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
4Free cash flow remains positive✗ -₹24 Cr
Profit that never becomes cash eventually stops being profit.
5Interest cover stays above 3x✗ 2.2x
How much operating profit can fall before interest stops being comfortably covered.

Investment Checklist

6 / 11 checks passed

✓ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✗ Generates positive free cash flow
✗ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

4 good · 5 neutral · 2 weak

Market Cap

₹213 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

20.9x

Fair

Fairly valued against the generic band

P/B Ratio

4.16x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹6.85

Profitable

Profitable on a per-share basis

ROE

15.9%

Strong

Strong capital efficiency

ROCE

11.6%

Moderate

Moderate return on the capital in the business

Debt/Equity

2.76x

High

High leverage

Revenue Growth (YoY)

17.8%

Healthy

Healthy top-line growth

Profit Growth (YoY)

68.3%

Healthy

Profits growing at a healthy clip

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

-₹24 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

Operating Margin

8.9%

Average

Average margins

Net Margin

6.7%

Average

Average bottom-line conversion

Current Ratio

1.86

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.20

Defensive

Steadier than the market

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

146.2 / 152.8

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

45.5

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹18 Cr	₹34 Cr	₹117 Cr	₹130 Cr	+93.8%
EBITDA	₹4 Cr	₹7 Cr	₹23 Cr	₹33 Cr	+108.4%
EBITDA Margin	20.5%	21.8%	19.6%	25.5%	—
PAT (Net Profit)	₹0 Cr	₹3 Cr	₹8 Cr	₹8 Cr	+206.4%
EPS	₹0.21	₹1.89	₹5.54	₹5.44	+196.3%
ROE	37.5%	77.1%	19.0%	15.9%	—
ROCE	6.4%	6.7%	11.8%	11.6%	—
Total Debt	₹18 Cr	₹54 Cr	₹106 Cr	₹141 Cr	+99.8%
Free Cash Flow	-₹4 Cr	-₹32 Cr	-₹43 Cr	-₹24 Cr	—

🟢 Revenue has grown at 93.8% a year over 3 years.

🟢 EBITDA has grown at 108.4% a year over 3 years.

🟢 EBITDA Margin has risen from 20.5% to 25.5% over 3 years (+5.0 pts).

🟢 PAT (Net Profit) has grown at 206.4% a year over 3 years.

🟢 EPS has grown at 196.3% a year over 3 years.

🔴 ROE has fallen from 37.5% to 15.9% over 3 years (-21.6 pts).

🟢 ROCE has risen from 6.4% to 11.6% over 3 years (+5.2 pts).

🔴 Total Debt has grown at 99.8% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹236 Cr

Total Liabilities

₹184 Cr

Cash & Equivalents

₹1 Cr

Operating Cash Flow

₹3 Cr

Capex

-₹27 Cr

Shareholding (proxy)

Institutional Holding

2.1%

Insider Holding

76.2%

Peer Comparison

Company	P/E	ROE
MARUTI SUZUKI INDIA LTD.	25.2x	13.4%
TITAN COMPANY LIMITED	68.5x	36.7%
TRENT LTD	87.2x	25.9%
AVENUE SUPERMARTS LIMITED	69.9x	12.7%

Recent News

3 mixed3 general

Espire Hospitality Ltd is Rated Sell

MarketsMojo, 17 Oct

Espire Hospitality Share Price near 52-week low, price view

Univest, 06 Oct

Espire Hospitality FY26 Results: EBITDA jumps 206% to ₹23.1 crore

scanx.trade, 25 SeptResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Espire Hospitality Ltd. Peer Comparison – Compare with Others

Value Research, 30 Aug

Espire Hospitality Announces Results for FY 2026 and Q4-FY26

Yahoo Finance, 29 JunResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Espire Hospitality Limited Submits Quarterly Compliance Certificate for Q4 FY26

scanx.trade, 13 AprResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Watch Items

Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongBusiness Quality · Growth · Valuation

MiddlingProfitability

WeakFinancial Health · Risk

Points for each in the Score ↑

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 3 high-severity red flags sit above this conclusion and should be read first.

3 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Free cash flow remains positive; Interest cover stays above 3x · see Key things to watch ↑