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Mint
a day ago
- Business
- Mint
India's hotel industry eyes double-digit growth in FY26 despite geopolitical headwinds
Even as geopolitical tensions tempered the first quarter of FY26, India's hotel industry is confident of steady growth in the full fiscal year. Many listed hotel players expect double-digit growth supported by improving consumer incomes, expanding infrastructure, and disciplined pricing strategies. This follows a strong FY25 that saw most hotel companies reporting strong revenue and profit gains, driven by rising travel demand from both business and leisure travellers. In the current year, too, the industry sees robust overall demand, with new hotel openings and increased investor interest signalling confidence in the sector's future. Also read | India's organised hotel industry has recovered to pre-pandemic levels: Report According to Chander K. Baljee, managing director of Royal Orchid Hotels, Q1 of FY26 saw some challenges in the North and West due to tensions with Pakistan, but overall the impact was limited. 'Most of our hotels are managed properties in the south, which were less affected because of geography," he toldMint. Baljee said Royal Orchid added 40 hotels in FY25 and plans to open about 30 more this year. Profits from these new hotels and renovations are expected to show up in the second half of FY26. Meanwhile, profitability in existing hotels remained strong, he added. Patanjali G. Keswani, chairman and managing director of Lemon Tree Hotels, had earlier toldMintthat both business and leisure travel across the industry slowed down after the Pahalgam attack in Kashmir and a brief rise in covid cases. 'Despite that, we are still on track to grow in mid-teens for the entire fiscal," he said. Keswani said with the country's economy growing at 6-7% in real terms (after adjusting for inflation) and 10-11% in nominal terms, and with more Indians earning around ₹3 lakh a month, a new group of travellers is entering the market each year. He also pointed out that better transport connections and more people owning SUVs is encouraging drive vacations and hotel stays. Attracting investments Keswani added that hotel companies that have recently gone public have attracted serious investors who want clearer and more transparent business information. In FY25, Schloss Bangalore (parent of The Leela), ITC Hotels (post demerger from ITC Ltd), Ventive Hospitality, and Brigade Hotels went public or filed for IPOs. A number of companies are likely to follow this year as well. Mandeep Lamba, president & CEO (South Asia) at hotel consultancy HVS Anarock, toldMintthat while geopolitical uncertainty may continue to cast a shadow globally, domestic demand remains strong enough to support growth in India's hotel sector. 'I don't foresee any major pressure on hotel rates. Compared to global benchmarks, pricing of hotel rooms in India is still relatively reasonable," he said. While a few overheated markets may see minor corrections in FY26, Lamba pointed to a noticeable shift in industry behaviour post-pandemic, where hotel operators are no longer reacting to short-term demand dips with deep rate cuts. Also read | Hotel industry's double-digit growth to continue this fiscal, says ICRA report 'There's a far more mature understanding that the market can sustain higher rates," Lamba said. 'Over the past two to three years, hotel operators have gained the confidence to hold pricing. Any rate corrections or adjustments today are a part of planned revenue strategies, rather than reactive pricing cuts." Prashant Biyani market analyst at Elara Capital toldMintthat for FY26, they expect a healthy double-digit growth for the industry driven by both average room rates and occupancy, He also expects more hotel companies to go public and international hotel chains to ramp up their presence in India. He said the April-June quarter of FY26 will likely do well, though not as well as earlier projected, as tensions between India and Pakistan in end-April and early May marred air travel. That said, the impact may be limited, since many north-western tourist spots enter a lean season in peak summer anyway. Lamba of HVS further added that supply in most Indian markets continues to lag demand. 'India has emerged as one of the top 8-10 global markets in terms of demand, but new supply isn't keeping pace," he said. 'With infrastructure development progressing rapidly, there's no real reason for rates to decline—unless triggered by an unforeseen macro disruption." Strong FY25 In FY25, most large hotel chains showed strong revenue growth. Indian Hotels Company Limited (IHCL), which runs the Taj brand, saw revenues rising 23% to ₹8,335 crore. ITC Hotels' revenue jumped 60% to ₹3,559 crore. Other chains like Lemon Tree, Chalet Hotels, Schloss Bangalore (The Leela), and Juniper Hotels grew 15-25%. EIH, which operates Oberoi Hotels, grew its revenues 9%, and Royal Orchid Hotels, 8.7%. Looking at profits, EIH and ITC Hotels both reported steady profit growth in FY25, with ITC's net profit rising from ₹424 crore to ₹638 crore. Vikram Oberoi, MD & CEO of EIH Ltd, in the company's recently concluded earnings call, said the company will have more opportunity to drive average room rate growth within the Oberoi Hotel ecosystem. 'With strong demand, with everything that's happening in India, over the medium to long term, we'll be able to drive greater premiums in Oberoi," he said. Meanwhile, IHCL saw net profit rise 53% to ₹2,038 crore. Lemon Tree's profit grew by 34%, and Juniper Hotels' profit nearly tripled. Schloss Bangalore turned a small loss in FY24 into a ₹47.66 crore profit in FY25. Samhi Hotels also moved from an ₹80 crore loss in FY24 to a ₹20 crore profit. Also read | Indian hotels saw a tepid Q1. Will the next quarter bring cheer? Chalet Hotels, the owner of several Marriott and Taj branded properties in India, saw its profit drop by nearly half, due to a non-cash adjustment but remained Ebitda positive. Its revenue grew 22% on the back of higher average daily room rates being charged and earnings before interest, taxes, depreciation, and amortisation —a measure of operating efficiency—increased 28%, and profit before tax rose 61%. The one-time ₹202 crore non-cash accounting adjustment lowered net profit. Excluding that, profit after tax was up 24%. Royal Orchid's revenue from operations increased steadily but profit slipped marginally by ₹3.3 crore. Baljee said profits were slightly lower last year partly because the company bought a partner's stake in its Bangalore hotel and paid upfront costs for renovating its flagship hotel in Mumbai. 'India's hotel industry RevPAR grew by 13-15% in FY25, largely due to strong room rate growth of 11-13%," said Elara's BIyani, adding that growth could have been even better if not for the dip in travel during the April-June quarter because of the general elections. RevPAR, or revenue per available room, is a simple way hotels measure how much money they're making from all their rooms, whether they're booked or not.
Time of India
31-05-2025
- Business
- Time of India
Hospitality IPO: Travel and hospitality companies prepare for IPO amid rising domestic tourism
ADVERTISEMENT ADVERTISEMENT ADVERTISEMENT New Delhi|Mumbai: About half a dozen travel and hospitality companies are preparing to go public buoyed by favourable demand-supply dynamics, rising domestic tourism, and bullish macroeconomic fundamentals. Those in the queue include Oyo, Pride Hotels Group, and boutique brand LaRiSa Hotels & Resorts. Lemon Tree Hotels plans to list unit Fleur Hotels in the next two years, Patanjali Keswani, chairman and MD, told ET. Last year, Keswani had said that the chain will be debt-free when the listing reported on Thursday that hospitality chain Oyo approached five investment banks for a meeting with key shareholder SoftBank in London next month that could determine the company's way forward for an initial public offering (IPO). Also, Pride Hotels Group, which has a presence in Delhi's Aerocity area, and recently expanded its footprint in Gujarat, through new signings in Gandhinagar and Surat, has begun initial groundwork for an IPO, said people familiar with the company declined to comment. Pride Hotels Group has over 60 hotels comprising over 5,500 keys across hospitality chain LaRiSa Hotels & Resorts is also aiming to go public, director Randhir Narayan told ET. The chain operates about 32 hotels comprising around 1,100 brands include LaRiSa Resorts, AM Hotel Kollection and 8fold by LaRiSa. The chain also does third-party hotel property management through its AM Hotel Kollection brand."The business is profitable, cash flow is there, and every month, we are trying to bring to the market a rebranded or a conversion hotel from our portfolio," said Narayan. "The plan is to (launch the) IPO and our timeframe is as soon as possible. We are hopeful that sometime this year it should come to fruition."Brookfield Asset Management-owned The Leela Palaces, Hotels and Resorts, which concluded its IPO on May 28, will get listed on June April, Prestige Hospitality Ventures Ltd, a wholly-owned unit of property developer Prestige Estates Projects Ltd, filed a draft prospectus with the Securities and Exchange Board of India (Sebi) to raise up to Rs 2,700 crore through an IPO, while Travel Food Services, with a strong presence in India's airport food and lounge sector, secured Sebi nod in April for a Rs 2,000 crore November, Brigade Hotel Ventures, a wholly-owned unit of Brigade Enterprises, submitted a draft prospectus to Sebi for a Rs 900-crore IPO. The company aims to cut debt with the share sale proceeds besides considering inorganic growth are also enthused by promising returns of already-listed hotel stocks in the past year."With India's tourism industry booming, there is likely to be a strong demand for hospitality stocks among domestic investors. The sector is benefiting from rising travel, increasing disposable incomes, and a post-pandemic resurgence in both leisure and business travel," said Dharmesh Mehta, MD and CEO, DAM Capital. "Moreover, listed hotel stocks are currently trading at reasonable valuations, making the sector attractive from a pricing perspective. As a result, hotel companies coming to the market with sensible valuations should be able to attract healthy investor interest in the primary market," he such as Ventive Hospitality and Samhi Hotels have risen more than 18% and nearly 52% respectively from their IPO price."Indian hotel companies are tapping public markets to fuel their next phase of growth, reduce debt, and scale operations," said Amrendra Singh, head of equity capital markets at SBI Capital.
Time of India
31-05-2025
- Business
- Time of India
Travel and hospitality companies prepare for IPO amid rising domestic tourism
New Delhi|Mumbai: About half a dozen travel and hospitality companies are preparing to go public buoyed by favourable demand-supply dynamics, rising domestic tourism, and bullish macroeconomic fundamentals. Those in the queue include Oyo, Pride Hotels Group, and boutique brand LaRiSa Hotels & Resorts. Lemon Tree Hotels plans to list unit Fleur Hotels in the next two years, Patanjali Keswani, chairman and MD, told ET. Last year, Keswani had said that the chain will be debt-free when the listing happens. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Why Seniors Are Snapping Up This TV Box, We Explain! Techno Mag Learn More Undo ET reported on Thursday that hospitality chain Oyo approached five investment banks for a meeting with key shareholder SoftBank in London next month that could determine the company's way forward for an initial public offering (IPO). Also, Pride Hotels Group, which has a presence in Delhi's Aerocity area, and recently expanded its footprint in Gujarat, through new signings in Gandhinagar and Surat, has begun initial groundwork for an IPO, said people familiar with the matter. The company declined to comment. Pride Hotels Group has over 60 hotels comprising over 5,500 keys across India. Boutique hospitality chain LaRiSa Hotels & Resorts is also aiming to go public, director Randhir Narayan told ET. The chain operates about 32 hotels comprising around 1,100 rooms. Live Events Agencies DRHPs Underway Its brands include LaRiSa Resorts, AM Hotel Kollection and 8fold by LaRiSa. The chain also does third-party hotel property management through its AM Hotel Kollection brand. "The business is profitable, cash flow is there, and every month, we are trying to bring to the market a rebranded or a conversion hotel from our portfolio," said Narayan. "The plan is to (launch the) IPO and our timeframe is as soon as possible. We are hopeful that sometime this year it should come to fruition." Brookfield Asset Management-owned The Leela Palaces, Hotels and Resorts, which concluded its IPO on May 28, will get listed on June 2. In April, Prestige Hospitality Ventures Ltd, a wholly-owned unit of property developer Prestige Estates Projects Ltd, filed a draft prospectus with the Securities and Exchange Board of India (Sebi) to raise up to Rs 2,700 crore through an IPO, while Travel Food Services, with a strong presence in India's airport food and lounge sector, secured Sebi nod in April for a Rs 2,000 crore IPO. Last November, Brigade Hotel Ventures, a wholly-owned unit of Brigade Enterprises, submitted a draft prospectus to Sebi for a Rs 900-crore IPO. The company aims to cut debt with the share sale proceeds besides considering inorganic growth opportunities. STRONG DEMAND Companies are also enthused by promising returns of already-listed hotel stocks in the past year. "With India's tourism industry booming, there is likely to be a strong demand for hospitality stocks among domestic investors. The sector is benefiting from rising travel, increasing disposable incomes, and a post-pandemic resurgence in both leisure and business travel," said Dharmesh Mehta, MD and CEO, DAM Capital. "Moreover, listed hotel stocks are currently trading at reasonable valuations, making the sector attractive from a pricing perspective. As a result, hotel companies coming to the market with sensible valuations should be able to attract healthy investor interest in the primary market," he added. Companies such as Ventive Hospitality and Samhi Hotels have risen more than 18% and nearly 52% respectively from their IPO price. "Indian hotel companies are tapping public markets to fuel their next phase of growth, reduce debt, and scale operations," said Amrendra Singh, head of equity capital markets at SBI Capital.
Mint
29-05-2025
- Business
- Mint
Lemon Tree Hotels expects strong revenue growth in FY26, lifted by biz travel
Hospitality chain Lemon Tree Hotels expects a strong revenue growth this fiscal year, lifted by a rebound in business travel and expansion across its various hotel segments. The positive outlook is underpinned by rising room rates and increasing occupancy levels, the company said. The company has also seen a stabilization of key assets like its 670-room Aurika Mumbai hotel, which have helped buoy its revenue. Also Read | The great hotel rush to India's least explored corner Lemon Tree Hotels' chairman and managing director Patanjali G. Keswani, speaking exclusively to Mint, said the company crossed ₹100 crore in quarterly net profit for the first time in January-March 2025, driven by strong occupancies in core business hubs. With 100 new hotels in the pipeline and a push to list its Fleur Hotels subsidiary to become debt-free, Keswani said Lemon Tree is positioning itself to tap rising demand for branded hotels across India—including in the vast unorganized sub-40-room segment—as more Indian households begin to travel. For the fiscal year ended 31 March 2025, the company on Thursday reported a revenue from operations of ₹1,286 crore, up 20% from FY24's ₹1,071 crore. Net profit for the year rose 34% to ₹243.1 crore. Also Read | Lemon Tree eyes shared loyalty alliances with international hotel chains "Our growth was driven across our various brands, and across the board, partly driven by occupancy and partly by average room rates. In Q4, Aurika Mumbai also stabilized and our occupancy stood at 77-78%, growing 6-7% year-on-year," he said. Business travel has now returned to normal for the company. Markets like Hyderabad maintained their occupancy upwards of 80%, he said. Mumbai, Bengaluru and Delhi also picked up in terms of occupancies as well as room rates. "Most of our key markets—which anyway are focused on business travel—did well, with some cities like Bengaluru picking up. This helps as a large part of our capital structure is in business hotels and this led to us crossing ₹100 crore of net profit in a quarter," he added. Also Read | Lemon Tree's renovation drive leaves little room for re-rating The hospitality company with a market capitalization of more than ₹10,000 crore currently operates 116 hotels, consisting of 41 owned properties with about 5,800 rooms, and 75 managed hotels with around 4,900 rooms. The company is also developing 100 new hotels, which will add approximately 6,600 rooms to its portfolio. Since April 2024, it has signed about 50 new hotels across various locations in the country. In September, Fleur Hotels Pvt. Ltd was converted from a private limited company into an unlisted public company, with plans to list it by December 2026 to pare debt and fuel expansion. Fleur, which houses flagship properties like Lemon Tree Premier, Delhi Aerocity and Aurika Mumbai International Airport, and a few owned hotels, is expected to generate over ₹700 crore in annual Ebitda post-listing, with management fees from it contributing ₹150-180 crore annually to the parent company. "It will be our top-priority to list Fleur and go debt free, but even if we don't list it, it will be debt free in the next three years," he said. For Q1 FY26, he said some business demand for hotels and retail demand too came down owing to the Pahalgam terror attack as well as the subsequent resurgence of covid. "But despite that we do see that we will do mid-teens growth in Q1 and the full year on a same store and same hotel basis. Basis this, the company expects to target a mid-teen revenue growth this fiscal." The company had been spending on renovating its rooms across various hotels and has spent about ₹100-130 crore a year for the last two years. This will continue into FY26 as well. "We are maintaining and in some hotels increasing our Ebitda margins in spite of increasing our renovation costs. Costs in technology upgradation, distribution, payroll, marketing spends have also increased. Despite that, our revenue growth is greater than our cost growth," he added. The company is renovating the entire Keys portfolio, which operates in the budget to midmarket segment. Lemon Tree acquired this portfolio of hotels in 2019, which added about 7,800 rooms and about 77 hotels to its portfolio then. The Keys portfolio includes three distinct brands: Keys Prima, Keys Select and Keys Lite. When Mint spoke to Keswani in December 2024, he outlined the company's strategy to capture future growth as demand for branded hotel rooms in the country is expected to outpace supply. Keswani said the company planned to leverage its strong brand presence and move up the pricing curve. He said that Lemon Tree had added more rooms in the past 12 years than any other hotel chain in the country. In December, Keswani also spoke about plans to create a brand to capture the vast unorganized hotel segment of sub-40-room properties across the country's smaller cities, aiming to tap into an under-penetrated market of over 1.2 million such rooms. Currently, India has about 200,000 branded hotel rooms, a number which is expected to grow to 300,000 by FY30. The country's growing economy and rising domestic travel, he said, are likely to push the number of households using branded hotels to 30 million, from the current five million, creating unprecedented demand for organized accommodation.
Time of India
05-05-2025
- Time of India
72-year-old woman killed in Kandivli building after altercation; 66-year-old neighbour held
Mumbai: A 72-year-old woman was allegedly murdered by her neighbour, a 66-year-old man, at a Kandivli building following an altercation on Monday. The police took the accused, Ashok Keswani , into custody. Tired of too many ads? go ad free now Keswani and the victim, Ranjana Sanghani , had a row over keeping construction materials on the common staircase of the building, said the police. The incident occurred around 3.30 pm on Monday. The property, located near Balbharti School on SV Road, is occupied by a few tenants. Sanghani was unmarried and lived with her sister. According to the police, Sanghani and Keswani had bickered over water-related issues in the past. "Sanghani was getting her house repaired. Construction material for the repairs was kept on the common staircase of the building. This sparked a dispute between her and Keswani on Monday," a police official said. The argument snowballed into violence as Keswani punched the elderly woman in the common area outside her house. Police said he then fetched a kitchen knife from his house and assaulted her. Police were informed about the incident and rushed to the property. Keswani was apprehended and taken to the police station. Sanghani was moved to a hospital where doctors pronounced her dead. She had suffered knife injuries on her hands. Police said Keswani had separated from his spouse; the couple did not have children. Keswani was booked under provisions of Bhartiya Nyaya Sanhita for murder. Police will record statements of Sanghani's sister and other residents of the property.
