Key Events This Week
Feb 09: Strong Q3 FY26 results announced, raising optimism despite valuation worries
Feb 10: Intraday high surge of 7.36%, reaching Rs.589.85
Feb 12: Valuation grade downgraded from very expensive to expensive
Feb 13: Week closes at Rs.533.45, down 1.86% on the day
Strong Quarterly Results Spark Early Week Rally
On 9 February 2026, ITDC reported a robust Q3 FY26 performance that masked underlying valuation concerns. The stock responded positively, closing at Rs.541.15, up 2.57% on the day, significantly outperforming the Sensex’s 1.04% gain. This strong quarterly showing appeared to reassure investors about the company’s operational resilience amid a challenging sector environment.
Volume on this day was moderate at 3,482 shares, indicating measured but confident buying interest. The positive momentum carried into the next session, setting the stage for a notable price surge.
Intraday Surge on 10 February Highlights Market Optimism
The stock’s most dramatic move came on 10 February, when it hit an intraday high of Rs.589.85, a 7.36% surge from the previous close. This represented a 9% rise intraday and marked a significant outperformance relative to the Hotels & Resorts sector and the broader market indices. The stock closed at Rs.554.60, up 2.49% for the day, while the Sensex gained a modest 0.25%.
Trading volume spiked to 29,008 shares, reflecting heightened investor activity and volatility. Technically, ITDC was trading above its 5-day, 20-day, and 50-day moving averages, signalling short- to medium-term strength, although longer-term resistance remained at the 100-day and 200-day averages.
This rally underscored the market’s recognition of ITDC’s operational momentum, even as the broader market maintained a cautious but positive stance.
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Midweek Decline Reflects Valuation Reassessment
Following the early week gains, ITDC’s price retreated on 11 and 12 February, closing at Rs.548.45 (-1.11%) and Rs.543.55 (-0.89%) respectively. This pullback coincided with a valuation shift announced on 12 February, where the company’s rating moved from very expensive to expensive based on key metrics such as the price-to-earnings (P/E) ratio of 58.82 and price-to-book value (P/BV) of 13.89.
Despite the downgrade, these multiples remain elevated relative to peers like EIH Ltd (P/E 28.22) and Chalet Hotels (P/E 31.58), though ITDC’s valuation is more aligned with sector norms than before. The company’s strong returns on capital employed (60.27%) and equity (21.45%) provide some justification for the premium, but the market appears to be pricing in caution amid sector headwinds.
Volume on 12 February was notably thin at 296 shares, suggesting limited conviction in the sell-off but reflecting a cautious stance among investors.
Week Ends with Modest Loss Amid Broader Market Weakness
On 13 February, ITDC closed at Rs.533.45, down 1.86% on the day, with volume of 652 shares. The Sensex also declined sharply by 1.40%, closing at 36,532.48. Despite the daily loss, the stock ended the week with a net gain of 1.11%, outperforming the Sensex’s 0.54% decline.
This final session reflected profit-taking and a cautious market mood, but ITDC’s relative resilience over the week highlights its defensive qualities within the Hotels & Resorts sector.
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Daily Price Performance vs Sensex
| Date | Stock Price | Day Change | Sensex | Day Change |
|---|---|---|---|---|
| 2026-02-09 | Rs.541.15 | +2.57% | 37,113.23 | +1.04% |
| 2026-02-10 | Rs.554.60 | +2.49% | 37,207.34 | +0.25% |
| 2026-02-11 | Rs.548.45 | -1.11% | 37,256.72 | +0.13% |
| 2026-02-12 | Rs.543.55 | -0.89% | 37,049.40 | -0.56% |
| 2026-02-13 | Rs.533.45 | -1.86% | 36,532.48 | -1.40% |
Key Takeaways
Positive Signals: ITDC’s strong Q3 FY26 results and subsequent intraday rally on 10 February demonstrated operational strength and short-term bullish momentum. The stock’s ability to outperform the Sensex by 1.65% over the week despite sector challenges highlights its relative resilience. Robust returns on capital employed and equity underpin the premium valuation and suggest efficient management of resources.
Cautionary Signals: The valuation downgrade from very expensive to expensive reflects a market reassessment of price attractiveness amid elevated P/E and P/BV ratios. The stock’s retreat in the latter half of the week, coupled with thin trading volumes, indicates investor caution. The Hotels & Resorts sector’s sensitivity to economic cycles remains a risk factor, and the modest dividend yield of 0.53% emphasises reliance on capital gains for returns.
Conclusion
India Tourism Development Corporation Ltd’s week was characterised by a strong start driven by solid quarterly results and a notable intraday surge, followed by a valuation-driven pullback amid broader market weakness. The stock’s 1.11% weekly gain and outperformance relative to the Sensex’s 0.54% decline reflect a cautious optimism among investors. While valuation metrics remain elevated, ITDC’s operational performance and historical outperformance provide a foundation for measured confidence. Investors should monitor sector dynamics and valuation trends closely as the company navigates a complex market environment.
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