Hotel Sigiriya Plc Adjusts Valuation Amid Rising Costs and Profitability Challenges

Hotel Sigiriya Plc, a small-cap player in the Hotels & Resorts industry, has recently undergone an adjustment in its evaluation. The stock's valuation score has been revised, reflecting a shift from a previously assessed expensive status to a fair valuation. This change comes amid a backdrop of notable financial metrics that warrant attention.
The company's P/E ratio remains at 0.0, indicating a unique position within its sector. The EV to EBIT and EV to EBITDA ratios are reported at -0.76 and -0.66, respectively, suggesting a complex financial landscape. Additionally, the EV to Capital Employed and EV to Sales metrics stand at -0.23 and -0.35, respectively, further illustrating the company's valuation dynamics.

Despite a reported ROE of 5.47%, the company has faced challenges, including a significant increase in raw material costs, which grew by 8% year-over-year. The pre-tax profit for the quarter ending March 2025 was recorded at LKR -33.82 million, while the net profit reached its lowest at LKR -86.71 million. These figures highlight the pressures on profitability, even as the stock has generated a return of 144.16% over the past year.

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