INDHOTEL - Indian Hotels Co. Ltd Share Price

In the earnings call held on May 11, 2026, management provided an optimistic outlook for fiscal year 2027 (FY '27). The Indian Hotels Company Limited (IHCL) expects to achieve double-digit revenue growth in the range of 12% to 14%. Key forward-looking points highlighted by management include:

1. Hotel Openings: IHCL anticipates over 60 hotel openings across various brands and geographies throughout FY '27.

2. Incremental Revenue from Acquisitions: Recent acquisitions are expected to contribute over INR 250 crores in incremental revenue.

3. Ginger Brand Growth: The Ginger brand is projected to aim for a portfolio of 250 hotels either under development or operational by the end of FY '27.

4. Renovated Inventory: Management expects that renovated inventory across key assets will create further upside through enhanced pricing power and improved guest experience.

5. Favorable Industry Fundamentals: The company noted that the industry fundamentals remain favorable, supported by resilient domestic demand and limited incremental supply in key markets.

Financially, IHCL achieved a consolidated revenue of INR 9,971 crores in FY '26, with a consolidated PAT exceeding INR 2,000 crores for the first time. Management indicated a strong balance sheet with liquidity exceeding INR 4,300 crores, providing flexibility for both organic and inorganic growth opportunities.

Overall, with robust strategic investments and a commitment to expanding their portfolio, management expressed confidence in sustaining margins, improving cash generation, and enhancing the quality of earnings moving forward.

Here are detailed questions and answers from the Q&A section of the IHCL earnings call transcript:

1. Sumant Kumar: "Can you talk on the current scenario, how the city-wise impact or any benefit of, say, lowering outbound?"

   • Puneet Chhatwal: "Currently, business is robust domestically, as international travel is affected, especially in Dubai and Maldives, which are down. March was tricky, but after the middle of April, we've seen a rebound, and I remain confident in delivering double-digit growth for FY '27, likely between 12% and 14%."

2. Sumant Kumar: "Which geography has done better, say St. James or U.S., how is the performance in this quarter?"

   • Ankur Dalwani: "In Q4, we faced some revenue loss due to the West Asia conflict, with about INR40-50 crores impacted in our international markets. However, domestic markets performed well. The trend is positive moving forward, and we still expect to achieve double-digit growth as guided."

3. Shaleen Kumar: "Is there any market where you're looking that the trend will change, for instance, Mumbai or Goa?"

   • Puneet Chhatwal: "Goa is seeing extraordinary growth, averaging around 25% in April. Mumbai's high base makes 15% growth unlikely. Renovations at some properties may improve performance, but substantial growth comes from area-specific conditions."

4. Shaleen Kumar: "Why are you operating at 90% occupancy? Shouldn't you increase rates?"

   • Puneet Chhatwal: "We're balancing occupancy and rate; increasing both is our goal. Historically, we've seen rates and revenue per room more than double over six years, with food and beverage sales being a key contributor to profitability."

5. Shaleen Kumar: "So, if targeting 12% growth, how should we think about breaking that? RevPAR or ARR?"

   • Puneet Chhatwal: "For 12% growth, around 4% will come from new businesses, while remaining growth will largely be driven by rate increases toward full occupancy potential."

6. Prateek Kumar: "Have you seen changes in your foreign tourist mix recently?"

   • Ankur Dalwani: "The tourist mix remains stable at about 30% for standalone hotels. However, domestic tourism is holding well, expected to continue supporting revenue. Despite declines in foreign tourist numbers, the overall impact is manageable."

7. Achal Kumar: "Do you see domestic travel replacing international demand?"

   • Ankur Dalwani: "Yes, there is some displacement of international traffic to domestic. However, how long this will last remains uncertain. Longer stays at hotels could occur if there's a continued push for domestic travel."

8. Murtaza: "Can you provide full-year revenue and EBITDA numbers for TajSATS and Roots?"

   • Ankur Dalwani: "TajSATS faced growth impacted by a new levy structure but showed resilience with an adjusted approach to maintain margins. Revenues for Ginger reached approximately INR709 crores, reflecting strong performance despite challenges."

9. Karan Khanna: "How should we think about the second-order impact of potential reductions in airline capacity?"

   • Puneet Chhatwal: "Crisis often leads to opportunities in hospitality, with new concepts emerging. Despite uncertainty, our focus is on increasing market share. Our cash reserves leave us well positioned to navigate fluctuations."

10. Rahul Jain: "Do we still have room for operating leverage going forward?"

    • Puneet Chhatwal: "Yes, there's still room for improvement, especially with new brands in their infancy. Our focus on scaling these assets and positive pricing strategies should enhance margins moving forward."