SSP's Indian JV potential warrants re-rating, says Shore Capital
By Benjamin Chiou
Date: Wednesday 02 Jul 2025
(Sharecast News) - Shares in SSP Group were rising strongly on Wednesday after the hospitality firm pleased investors with the price range of the IPO of its joint venture in India - a high-growth market that house broker Shore Capital said is still underappreciated by investors.
SSP said plans to list the Travel Food Services joint venture with K Hospitality Corp on 14 July at a price brand of 1,045-1,100 Indian rupees per share, indicating an expected market capitalisation of INR137.6bn-144.8bn (£1.17bn-1.23bn).
This price is equivalent to around 75p per SSP share, according to Shore Capital. This, the broker said is "towards the higher end of our initial expectations, with SSP's stake alone the equivalent to 43% of the group's current market capitalisation for just 15% of its earnings base".
The valuation of TFS, at around 40 times implied earnings, is an "endorsement of the generational opportunity India offers and TFS' market leading position, which is yet to be fairly reflected in the SSP share price in our view".
The stock is trading at under 15 times earnings, but Shore Capital said the growth opportunity in India - along with the US market - warrants a "premium valuation".
Shares were up 9.1% at 189.67p by 1118 BST.
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