PPHE Hotel Group - Creating value

PPHE has accompanied news of its proposed transfer to a premium listing with a significant increase in market valuations of its properties (up c £140m since last reported). This accentuates already substantial hidden reserves, implying fair value c £24/share. Value creation apart, this should boost its ability to leverage on its assets for future projects. Even given current share price strength (up almost a third since March), PPHE’s rating reflects neither this asset backing nor excess liquidity (c £290m cash equivalents at end 2017), which highlights its reinvestment potential.