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Indian Hotels Q3FY23 net profit at Rs 383 crore

Feb 1, 2023

By: BlinkX Research Team

Indian Hotels Company Limited (IHCL), part of the Tata group, plans to invest Rs500 crores annually for the expansion of their hotel chains. These would include the specific franchises like Ginger, Vivanta, SeleQtions etc. Indian Hotels is on track to expand to 300 hotels across India by the year 2025. What stood out, however, in the group’s quarterly numbers, was a veritable 403% growth in consolidated net profits from Rs76 crores to Rs383 crore yoy for Q3FY23. Seeing the growth in demand for hotels post-pandemic, in what could be considered revenge buying, has have opted to plough back their profits to open a total of 18 hotels in a year.

In addition, IHCL also plans to expand its hotel network abroad, with Europe and West Asia having been identified as ideal getaway locations. On the portfolio front, expanding to 300 hotels will enable the company to produce EBITDA margins of 33%, and also consolidate 35% EBITDA share contribution by FY26 from new businesses. 

This restructuring of the portfolio was carried out under the Ahvaan 2025 guidance, that plans to rewrite the narrative of hotels in India post the pandemic. The pandemic had seen tremendous pressure on contact intensive businesses like hotels and the bounce is likely to be equally frenetic.

In terms of top line performance of IHCL, consolidated revenues grew 54% yoy to Rs1,744 crores while EBITDA grew by 90% yoy to stand at a healthy Rs655 crores. Both leisure and business hotels saw remarkable occupancies, with more than 70% of hotels being booked at any given time, and a 27% increase over pre-COVID levels in Average Room Rates (ARR);  bolstering net profits.