Choice Institutional Equities has lowered its target price for Ventive Hospitality to Rs 610 while maintaining an 'Add' rating. The revision follows margin pressures driven by rising diesel costs in the company's Maldives operations. Investors are tracking how the firm manages these energy expenses and adjusts to new foreign currency regulations, even as top-line revenue continues to show growth.
Choice Institutional Equities has revised its target price for Ventive Hospitality to Rs 610, reflecting a more conservative outlook on earnings due to operational headwinds. The brokerage maintains an 'Add' rating on the stock, noting that while the company continues to see solid demand, profitability is being squeezed by external factors impacting its Maldives resort portfolio.
The primary pressure on the company’s bottom line stems from elevated diesel costs. Because several of these properties rely heavily on diesel-powered generators for power, global price volatility directly affects operating margins. According to recent reports, the Maldives operations faced approximately Rs 30 crore in increased fuel and ancillary costs linked to geopolitical tensions in West Asia. This has kept EBITDA margins under pressure despite healthy demand trends.
Financially, the company has shown signs of top-line growth. In its Q2 FY27 results, Ventive Hospitality reported consolidated revenue of Rs 5.5 billion, representing a 13% increase compared to the previous year. EBITDA also saw an 11% rise to Rs 2.1 billion. However, the brokerage noted that these growth figures are being tempered by the higher cost of operations, leading to the lowered target price.
To address energy reliance, the company has initiated a move toward renewable power. Ventive Hospitality is working on a 5-megawatt solar installation project in the Maldives. This initiative includes a 693 kW installation at the Raaya resort and is expected to yield annual savings of Rs 15–20 crore starting in the 2028-29 fiscal year. By reducing dependence on diesel, the management aims to structurally lower operating expenses in the long term.
Beyond energy costs, shareholders are monitoring regulatory shifts. A new policy implemented in the Maldives in September 2026 now mandates that resorts convert a portion of their foreign-currency gross sales into Maldivian rufiyaa. This regulation adds a layer of complexity to liquidity management, though current reports suggest the company has adequate reserves to navigate the transition.
Additionally, there is an ongoing requirement for the company to meet public shareholding thresholds. As of early November 2026, the company received no-objection certificates from the BSE and NSE for reclassifying 11 promoter entities to the public category. This is part of a broader compliance effort, as the company faces a mandatory promoter dilution of approximately 14% of equity to meet SEBI norms. Investors may continue to watch the timeline for this dilution and the execution of the solar energy projects as key indicators for future margin recovery.