On the Casablanca Stock Exchange, Risma is a stock that has attracted a lot of attention recently. And for good reason: the hotel company is showing solid signs of recovery after years of mixed performance, marked by massive investments combined with an unfavorable tourist situation.
Risma stood out above all as being a stock that resisted market gloom. While this shows -5% in Year-to-date variation, Risma is up more than 21%, even though the value has undergone a slightly downward trend in recent sessions. It appears to be moving in the direction of the market rather than undergoing a correction.
The fundamentals of the company are improving, especially after the restructuring of the assets. The enthusiasm is especially palpable for the hotel operator following the good figures in the tourism sector.
Indeed, the sector is showing a clear recovery which has been reflected in the company’s 2017 accounts, and this recovery does not appear to be fading. The latest figures at the end of May from the Tourism Observatory show a total of 4.1 million tourists who visited Morocco between January and May 2018, an increase of 9% compared to the same period a year earlier.
Many market analysts agree on the fact that Risma will benefit from this particularly favorable sectoral situation. Among them, analysts from CFG Bank who, in a note published on June 25, recommended the stock for purchase and valued it at 258 DH. Remember that the bank holds nearly 2% of the capital of the hotel operator.
Risma accounts for 7% of tourist nights in Morocco
According to CFG, Risma is the leader in the hotel sector in Morocco in terms of bed capacity but also overnight stays, with 4,181 rooms and more than 1.5 million overnight stays in 2017, which represents 7% of overall overnight stays in Morocco.
Sectoral dynamics are particularly strong for 5* and 3* hotels, which recorded an increase of 24% and 32% at the end of March 2018. These two categories of hotels represent 92% of turnover and 89% of Risma’s Ebitda.
Risma is also multi-segmented, which allows it to gain punch. The company is present in both the Leisure and Business segments and operates, at the end of 2017, 27 hotels (of which 22 are owned and 5 rented) spread across all tourist regions of the kingdom, and covering all ranges with the Luxury and Upscale segment (5 Sofitel, 2 M’ Gallery and 1 Pullman), the Mid-range segment (2 Novotel and 1 Mercure), the economic segment (16 Ibis) and the very economical segment with 4 hotel units under the Ibis Budget brand.
Generally speaking, it is the Luxury and High-end segment which is largely predominant in the group’s activities, representing 72% of consolidated turnover and 64% of EBITDA, followed by the economic segment (20% of turnover and 25% of EBITDA). The Mid-range segment represents 8% of turnover and 11% of EBITDA.
The recovery of the tourism sector, in addition to the end of the era of massive investments linked to renovations and the construction of new hotels, as well as the absorption of the significant impact of several exceptional elements which have affected the hotelier’s accounts in recent years, make Risma one of the most attractive growth stocks on the list. Especially since the company promises an upcoming distribution of dividends after years without returns.
source: leboursier.ma
