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Leela Palaces Hotels operator posts consolidated net profit of ₹9 crore
Meanwhile, its consolidated revenue from operations grew by 20 per cent to Rs 274.8 crore, up from Rs 228.2 crore in the year-ago period.
Further, the company's revenue per available room (RevPAR) grew by 20 per cent, driven by a 13 per cent higher average daily rate (ADR), strong occupancy, and customers' increasing willingness to pay a premium for services. Occupancy rates for the group grew by 4 per cent to 63.6 per cent in the quarter.
This RevPAR growth was higher than the industry average of 10 per cent, Anuraag Bhatnagar, Chief Executive Officer, told analysts on a post-earnings call. He added that the growth is likely to continue in the coming years, driven by the chain's expansion plans and a sustained supply gap in the luxury hospitality segment.
According to consultancy firm HVS, the industry has approximately 170,000 branded keys, of which only 29,000 are luxury branded keys – a mere 17 per cent. This gap is expected to grow further, with luxury demand set to witness a compound annual growth rate (CAGR) of 13.7 per cent between 2025 and 2028, while luxury supply is expected to see a CAGR of 8.8 per cent.
Leela Hotels currently operates 13 properties with 3,544 keys across 11 cities in India, including five owned, seven managed, and one franchised hotel.
'We are entering a defining phase of growth with eight hotels under development, including our strategic expansion into Mumbai through a landmark mixed-use development in Bandra Kurla Complex featuring a 250-key ultra-luxury hotel, complementing the 63 high-end serviced apartments under development near Mumbai International Airport,' Bhatnagar stated in a release. The serviced apartments are slated for completion by FY27.
In total, this will add 966 keys to the chain's portfolio with an investment of Rs 400 crore for same-store sales growth, out of which Rs 100 crore has already been spent.
'We have Rs 1,130 crore on the contracted cycle for five hotels, which will be spent in the next 2.5 years,' management told analysts on the call.
Further plans include expansion into high-growth markets including Agra, Srinagar, Ayodhya, Ranthambore, Bandhavgarh, and Sikkim, while enhancing existing assets, such as adding new banquet space at Leela Palace Delhi in the second quarter, new plunge pool villas at Leela Palace Udaipur by the March quarter, and launching its by-invitation-only private members' club ARQ in New Delhi, Bengaluru, and Chennai this year.
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