Pune Media

ITC Hotels, Siemens Energy, AB Lifestyle: Are these 3 new stocks value traps or opportunities? – Stock Insights News

Picture this: Reliance Industries holds Reliance Retail and Reliance Jio under one roof, Tata Motors runs both its Commercial Vehicle and Passenger Vehicle divisions, and Edelweiss houses businesses ranging from asset management to housing finance. Such a business often attracts a holding company discount.

It’s because the market struggles to assign fair value to each business individually, and the potential of these units often gets overshadowed within the larger consolidated structure. Additionally, growth can also be subdued.

A division that could have scaled faster on its own may find itself limited when it is part of a much bigger, slower-moving entity. This is why conglomerates often opt to demerge, creating standalone verticals with independent management and focus.

These businesses can chart their own course, move faster, and unlock value that was previously hidden. Such demergers, when backed by strong financial performance, can turn into massive value creators for shareholders.

On similar lines, three recently demerged businesses have entered the market, and they are worth keeping on your radar.

#1 ITC Hotels: Riding Travel Boom, Targeting 20,000 Rooms

ITC Hotels is a standalone entity that was demerged from ITC. It is among the fastest-growing hospitality chains in India with 143 properties and 13,469 rooms under 6 brands. This includes ITC Hotels, Mementos, Welcomhotel, and Fortune.

ITC Hotels owns 42% of this portfolio while it manages 58%, from which it earns management fees. The company plans to increase the managed portfolio to 70% by 2030 as it expands.

RevPAR and occupancy gains drive steady growth.

In Q1FY26, standalone revenue grew 20% year-on-year (YoY) to ₹7.8 billion, driven by a 12.8% increase in revenue per available room (RevPAR) to ₹7,900. Of the total revenue, 50% came from rooms, food and beverages (40%), and others (10%).

ITC Hotels’ RevPAR in luxury, upper-upscale, and upscale is 34% higher than the overall industry. Occupancy also grew 300 basis points (bps) to 73%.

EBITDA grew 13% to ₹2.3 billion, while margins remained stable at 32%. Higher RevPAR, higher management fees, and cost optimisation drove this growth. Profit after tax (PAT) grew 47% to ₹1.5 billion.

Aggressive expansion plan with one hotel a month

Looking ahead, the company aims to reach 220 hotels, with 20,000 rooms, by 2030. To achieve this, it aims to open 1 hotel per month for the next 24 months. Of this, 58 hotels with 5,340 rooms are in the pipeline.

ITC Hotels sees significant headroom for growth, with 25% of its inventory operating at occupancy levels below 70%. ITC Hotels trades at an EV/EBITDA multiple of 36x, in line with Indian Hotels (35x).

ITC Hotels Share Price

#2 Aditya Birla LifeStyle Brand: A Company with Iconic Brands

Aditya Birla Lifestyle, a part of the Aditya Birla Group, recently demerged from Aditya Birla Fashion and Retail. The business currently houses renowned lifestyle brands like Van Heusen, Louis Philippe, Peter England, Allen Solly, American Eagle, Forever 21, and Reebok.

As of 30 June 2025, the company has a retail network comprising 3,230 brand stores, 569 small-town stores, and a presence in over 785 cities and 190 malls. The company operates under two business segments: Lifestyle brands, Youth Brands, and Innerwear.

Iconic labels hold steady as youth brands stumble.

Lifestyle brands include Louis Philippe, Van Heusen, Allen Solly, and Peter England. Lifestyle revenue rose 6% YoY to ₹15.7 billion, with 15% like-to-like growth. The EBITDA margin declined by 110 bps to 17.9%, primarily due to increased advertising spending during a high-intensity event.

In channel-mix, revenue from retail stores increased by 12% to ₹10.5 billion, indicating that demand may be rebounding. The company also noted a bounce-back in sales from small towns. Wholesale rose 6% to ₹2.9 billion, while e-commerce declined 19% to ₹1.7 billion.

Youth Brands are in an investment phase.

Youth Brands’ (American Eagle, Reebok, and Van Heusen Innerwear) revenue declined 2% to ₹3.1 billion, primarily due to the closure of Forever21. However, the portfolio continues to deliver margin expansion, with margins increasing 170 bps to 2.8%.

This segment continues in investment mode with the innerwear business yet to achieve profitability. It is now available in over 37,000 trade outlets and more than 100 exclusive stores. Reebok is profitable and is available in 175+ stores and 950+ offline touchpoints.

On a consolidated basis, revenue grew 3.2% YoY to ₹18.4 billion in Q1FY26. EBITDA grew by just 1%, while margins fell 40 basis points to 15.5%, primarily due to lower margins from youth brands. PAT remained flat at ₹240 million, as against ₹230 million in the same quarter last year.

Looking ahead, the company anticipates accelerating its growth trajectory through a rapid pace of store additions over the next three years. Lifestyle Brands are expected to achieve double-digit growth for the next few years, building on sustained strong like-to-like growth.

Scaling innerwear and Reebok to unlock the next leg

Newer businesses, including American Eagle, Reebok, and Innerwear, are projected to grow at even higher rates of 18-20%. Innerwear is expected to break even in FY27, which would enable it to post a higher margin and PAT. It also plans to open 250 stores in FY26 across all brands.

From a valuation standpoint, the company trades at an EV/EBITDA multiple of 15.3x. The valuation is at a discount to Vedant Fashion (25.5x) and a premium to Raymond Lifestyle (13x) and Arvind Fashions (12x).

Aditya Birla Lifestyle Share Price

#3 Siemens Energy: A Play on Clean Energy

Siemens Energy, a leading energy technology company, is a recently listed entity following its demerger from Siemens, a group company of Siemens Energy AG. Its business spans decarbonisation, power generation, power evacuation, and clean energy.

Powering ahead on India’s energy transition wave

Decarbonisation is a key focus for Siemens Energy, benefiting from India’s decarbonization efforts. The company provides solutions to help customers achieve energy transition goals and reach decarbonization and net-zero targets.

In the power generation sector, it provides products such as large gas and steam turbines, as well as large generators, to customers. Its customers include electric utilities and industrial customers. It provides grid automation and EPC services in power evacuation. EPC stands for engineering, procurement, and construction services.

The company holds exclusive rights for the parent Siemens Energy products, solutions, and services portion in several South Asian countries, specifically India, Bhutan, Nepal, Sri Lanka, and the Maldives. Siemens’ financial year ends in September every year.

Strong growth driven by sectoral tailwind

Revenue grew 93.3% YoY to ₹51.8 billion in the nine months ended June 2025. This growth was driven by both power transmission and power generation. Transmission segment revenue grew 113% to ₹28.3 billion, while generation segment revenue grew 73.7% to ₹23.5 billion.

PAT more than doubled to ₹7.4 billion, from 3.3 billion in 9MFY24. In terms of profitability, the transmission segment’s profit before tax increased 178% to ₹5.6 billion, while the generation segment’s profit grew 58% to ₹4.0 billion.

Strong order book ensures visibility for two years.

Siemens Energy has a robust order backlog of ₹156 billion, providing revenue visibility for over two years. With global expertise, the company is well-positioned to tap into ₹3.4 trillion capex on inter-state transmission over the next 4-5 years.

The demand for high-voltage (HV) and grid stability equipment is increasing, and Siemens is well-positioned to capitalize on it. To meet the demand, it is also expanding its capacity, with an investment of ₹2.8 billion at its Aurangabad factory.

Premium valuations leave little margin for error

Siemens Energy is trading at a P/E of 291x, significantly higher than Hitachi Energy (174.5x) and ABB (59.2x). Being newly listed, there isn’t much historical data to assess its valuation.

Siemens Energy Share Price

Conclusion

Demerger stories are exciting because they promise to unlock shareholder value, but the outcome ultimately hinges on financial performance. If a newly listed company starts showing strong and consistent growth, the market usually rewards it with a rerating. But if earnings remain weak, the stock often drifts lower, sometimes trading even cheaper than before. At the end of the day, stock prices move in line with earnings growth—and no amount of structural change can override that.

Disclaimer

Note: Throughout this article, we have relied on data from and the company’s investor presentation. Only in cases where the data was not available have we used an alternate but widely used and accepted source of information.

The purpose of this article is only to share interesting charts, data points, and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educational purposes only.

Madhvendra has been deeply immersed in the equity markets for over seven years, combining his passion for investing with his expertise in financial writing. With a knack for simplifying complex concepts, he enjoys sharing his honest perspectives on startups, listed Indian companies, and macroeconomic trends.

A dedicated reader and storyteller, Madhvendra thrives on uncovering insights that inspire his audience to deepen their understanding of the financial world.

Disclosure: The writer and his dependents do not hold the stocks discussed in this article.

The website managers, its employee(s), and contributors/writers/authors of articles have or may have an outstanding buy or sell position or holding in the securities, options on securities or other related investments of issuers and/or companies discussed therein. The articles’ content and data interpretation are solely the personal views of the contributors/ writers/authors. Investors must make their own investment decisions based on their specific objectives, resources, and only after consulting such independent advisors as may be necessary.



Images are for reference only.Images and contents gathered automatic from google or 3rd party sources.All rights on the images and contents are with their legal original owners.

Aggregated From –

Comments are closed.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More