MHRIL - Mahindra Holidays & Resorts India Limited Share Price

In the recent Q2 and H1 FY '26 earnings conference call held on October 31, 2025, Mahindra Holidays & Resorts India Limited (MHRIL) provided an optimistic outlook and several key forward-looking points.

Management confirmed the goal of reaching 10,000 keys by FY '30 and stated they are on track to achieve this milestone, currently having visibility on approximately 75% of the journey. During the half-year, the company added a new resort in Mahabaleshwar and completed four expansion projects, contributing 209 keys to their inventory. They also mentioned plans to launch multiple new resorts in the second half of the year, aimed at adding roughly 1,000 keys gross, despite the expected exits of about 200 keys.

Financially, the standalone total income rose to INR 381 crores, an increase of 3% year-on-year, with EBITDA reaching INR 141 crores, up 18%. The company reported a PAT of INR 52 crores, a 10% increase for the quarter. Their cash position improved to INR 1,532 crores.

One notable development is an increase in member additions through digital and referral sources, which now accounts for 66% of sales, up from 58% last year. The Average Unit Revenue (AUR) also saw an impressive rise, reaching INR 9.3 lakhs, up 85% year-on-year, alongside upgrades totaling INR 66 crores, representing a 24% increase from the previous quarter.

Overall, management expressed confidence in overcoming weather-related challenges, maintaining a healthy occupancy of 73.4% despite adverse conditions, while focusing on enhancing member experience and optimizing operational efficiencies through technology and better sales strategies.

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

1. Pankaj Kumar: "In H1, we have seen Mahabaleshwar got added also as you highlighted resort expansion was completed. And for the full year earlier, we had targeted around 1,000 keys. So, where are we in terms of achieving this target?"

Manoj Bhat: Thank you for your question. We are indeed on track to achieve the target of adding 1,000 gross keys for the year, despite some exits. Most of the additions will come from leased properties, aligning with our capital-light model. Next year, we aim to see 2 new Greenfield projects launch, further enhancing our inventory.

2. Pankaj Kumar: "Earlier, we had a vision of achieving 10,000 room inventory by FY '30. How are we placed in achieving that?"

Manoj Bhat: Our goal of reaching 10,000 keys by FY '30 remains intact, and we have clarity on about 75% of this journey in terms of our pipeline. While funnels need to convert, the momentum looks promising.

3. Pankaj Kumar: "The member-to-room ratio is at 53 versus 58... Will this ratio further improve?"

Manoj Bhat: Yes, as we add more rooms, this ratio will improve, allowing for better availability for our members. The stability observed recently has been due to strategic timings for room additions.

4. Pankaj Kumar: "This quarter shows losses in HCR business. Any comments on this while we enter peak season?"

Manoj Bhat: The peak season for HCR is actually in Q3 and Q4. Historically, this quarter has not shown strong performance, typically breakeven. We expect Q4 to be strong and will focus on optimizing performance moving forward.

5. Shreyans Gathani: "In terms of resort closures, how much do we have left?"

Manoj Bhat: Resort reviews are ongoing based on customer feedback and occupancy. We're aiming for a balanced 200 key exits in the next 6 months to enhance quality, as part of a continuous improvement strategy.

6. Shreyans Gathani: "What about the strategy beyond vacation ownership?"

Manoj Bhat: We're working on strategies extending beyond vacation ownership, and I'll share more details soon. We're excited about the potential growth in this area.

7. Sucrit Patil: "What strategies are in place to build a strong competitive edge?"

Manoj Bhat: Our strategy focuses on scale and quality of inventory, strong positioning in family vacations, enhancing curated experiences, and maintaining warmth in service. We'll sharpen these to deepen our market presence further.

8. Dhvaneet: "How do you evaluate opening multiple properties in the same location to avoid cannibalization?"

Manoj Bhat: Our data indicates that we can successfully operate multiple resorts in high-demand locations without cannibalization because we monitor booking trends and optimize offerings based on demand patterns.

9. Dhvaneet: "What about international presence in achieving the 10,000 keys goal?"

Manoj Bhat: Internationally, we plan to expand through partnerships rather than building our own resorts, leveraging inventory arrangements to assess market trends and member demands without heavy capital investment.

10. Preeti Agarwal: "Are you implementing AI-driven initiatives?"

Manoj Bhat: Yes, AI is integrated into our operations through tools like RIYO for occupancy prediction and a referral engine to enhance member referrals. We're also planning future enhancements like chatbots and improved operational insights.

11. Himanshu Shah: "How does the increase in digital and referral impact member acquisition costs?"

Manoj Bhat: The referral channel has the lowest acquisition cost due to high conversion rates. Digital, while higher in cost, also drives significant conversions. Together, they are improving our overall member acquisition efficiency.

12. Athar Sayyed: "As we adopt an asset-light model, how do we maintain quality?"

Manoj Bhat: We maintain quality through brand standards and rigorous monitoring. Our teams ensure that partners adhere to these standards to deliver the expected customer experience consistently.

This captures the significant questions and respective detailed answers while maintaining the context and subtleties of the conversation.