Penny Stock Under Rs 30 is in Focus as Company Signs Non-Binding Letter of Intent with Intercontinental Hotels Group for Pushkar Project

The stock is up by 42 per cent from its 52-week low of Rs 19.31 per share and gave multibagger returns of 200 per cent in 2 years.

On Tuesday, shares of Spectrum Foods Ltd plunged 1.85 per cent to Rs 27.13 per share from its previous closing of Rs 27.64 with an intraday high of Rs 30.05 and an intraday low of Rs 26.01. The stock’s 52-week high is Rs 42.45 per share and its 52-week low is Rs 19.31 per share. The shares of the company saw a spurt in volume by more than 10 times on BSE.

In a significant development, Spectrum Foods Limited has signed a non-binding Letter of Intent (LOI) with Intercontinental Hotels Group (IHG) for the management and branding of their upcoming five-star hotel project in Pushkar, Rajasthan. This collaboration is part of Spectrum Foods' strategy to diversify into the hospitality industry, particularly under IHG’s upscale ‘voco’ brand. The proposed property will be launched by June 2025, featuring 185 rooms—138 in the initial phase and an additional 47 rooms in the second phase. The luxury resort is set to include pool villas, premium rooms, three F&B restaurants, a full-service spa, gym and expansive wedding and corporate event spaces, elevating Pushkar's hospitality landscape.

The financial projections provided by IHG for this upscale resort are promising. Starting operations in June 2025, the forecasted revenue for the remaining year includes Rs 3,540.88 lakh, with a net profit of Rs 789.17 lakh. The occupancy rate is expected to grow over time, with a significant jump by 2027 when the net profit is projected to reach Rs 2,647.12 lakh and revenue Rs 5,952.47 lakh. These financial projections are based on market conditions and are subject to change, but the forecast highlights the long-term potential of the project as a major contributor to the company’s revenue streams.

The voco brand, launched by IHG in 2018, has rapidly expanded globally, with operations in over 25 countries and a goal to reach 200 hotels within ten years of its inception. Known for its flexibility in design, quick conversion process and welcoming service, voco has already gained recognition as a world-leading premium hotel brand. Spectrum Foods aims to leverage this global reputation and brand value to position its Pushkar property as a premium destination for both domestic and international travellers.

Spectrum Foods' management is keen on completing the Pushkar project debt-free, relying on cash reserves and internal accruals. This initiative marks a strategic shift for the company, showcasing its ability to diversify beyond its core business. The successful completion of this resort will not only strengthen Spectrum Foods' financial performance but also its brand presence in India's booming hospitality sector. However, the company has included a forward-looking disclaimer, emphasizing that the projections are based on current assumptions and are subject to various external risks.

Spectrum Foods Ltd. services the food industry. The company manufactures and sells spices and industrial salt. Spectrum Foods also participates in share trading activities. The company has a market cap of Rs 66 crore and debtor days have improved from 39.7 to 20.8 days.

The stock is up by 42 per cent from its 52-week low of Rs 19.31 per share and gave multibagger returns of 200 per cent in 2 years. Investors should keep an eye on this micro-cap stock.

Disclaimer: The article is for informational purposes only and not investment advice. 

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