New Delhi, Feb. 12 -- Foreign brokerage Jefferies has initiated coverage on ITC Hotels Ltd, the demerged hotels business of ITC, with a 'Buy' rating, citing potential for a valuation rerating. Jefferies has set a target price of Rs.240 (upside potentialof 40% from previous close), noting that the current discount to Indian Hotels Co Ltd (IHCL) may narrow over time.

ITC Hotels, which debuted on the stock exchanges BSE and NSE on January 29, 2025, is expected to benefit from a cyclical recovery in the hospitality sector.

Jefferies emphasized that ITC Hotels has retained its experienced management team, which will aid in driving strategic growth post-demerger. The brokerage believes that the independent existence of ITC Hotels will enhance...