Skift Travel News Blog

Short stories and posts about the daily news happenings around the travel industry.

Hotels

Indian Hotels Company Enjoyed Another Record Quarter

1 year ago

Indian Hotels Company (IHCL) plans to reach a portfolio of 300 hotels by 2025, it said on Tuesday when reporting its earnings.

“We are looking to open 18 hotels a year,” said CEO and managing director Puneet Chhatwal. He cited plans to grow through conversions and new construction across India and in West Asia and Europe. The company plans to invest about $60 million a year for the next few years specifically for hotel development.

India’s largest hotel operator — with brands such as Taj and Ginger — had its highest-ever net profit in the quarter that ended on December 31. The Tata Group-backed company reported consolidated net profit of $46.8 million (3.83 billion rupees) on revenue of about $206 million (16.86 billion rupees).

“We are very pleased to report our Q3 [third quarter] results with a record level on all key parameters, revenue, EBITDA, EBITDA margin, PAT, strong free cash flows and being net cash positive,” Chhatwal said.

The strong performance followed hard on a previous quarter that was also a company record thanks to a surge in post-pandemic travel. Hotel occupancy was up 27 percent on average from pre-crisis levels, while average room rates were up by 27 percent compared with 2019 levels.

“With the month of January gone by almost tonight, we see the momentum continuing,” Chhatwal said. “We have a fair idea and depth of the business on the books and the pick up the way it is coming. The outlook is very strong.”

For more context on CEO Puneet Chhatwal, read Taj Hotels CEO on the Sweeping Strategy Behind Delivering Best-Ever Financials.

Hotels

Indian Hotels Company Had The Best Quarter in Its History: Here’s Why

2 years ago

Tata Group-backed Indian Hotels Company (IHCL) reported what Puneet Chhatwal, its managing director and CEO, called the best first quarter in the company’s history.

The hotel brand reported strong free cash flows of almost $25 million and net cash positive of $33 million in its consolidated and standalone financials for the first quarter ending June 30, 2022.

A surge in demand across markets and segments, with occupancy and rates exceeding pre-Covid levels and backed by an asset-light model, Indian Hotels Company achieved a milestone earnings before interest, taxes, depreciation, and amortization of $51 million, compared to a loss of $15.5 million in the same quarter last year, said Chhatwal.

The company reported a profit after tax of $21 million against only $750,000 in 2019-20.

“The trend is very positive in India and we have outperformed in almost every market on the domestic front, except for a marginal lag in Rajasthan,” Chhatwal said.

With revenue per available room levels exceeding that of the first quarter of 2019-20 in Indian metropolitan cities, Chhatwal, said, “The cities of Mumbai, Bengaluru and New Delhi are back.”

Mumbai Bengaluru and Delhi are also important for the hotel brand as it has owned or licensed assets in these cities. “We account for those revenues and a change in the revenue numbers has a significant impact on our portfolio and our performance,” Chhatwal said.

The company has signed 10 new hotels in the first quarter, with three hotels each under the Taj and Ginger brands, and two hotels each under the SeleQtions and Vivanta brands, and expects to sign 15 more for the rest of the year.

With its presence in over 100 locations in India, Indian Hotels Company has further strengthened its pan-India footprint with the opening of four new hotels in the current fiscal.

“So our pan India footprint is stronger and is getting even further stronger as each month and each quarter goes by through our aggressive asset-light growth strategy that has been in place,” Chhatwal said, adding that the asset-light model is not only driving growth, but is also helping the brand find the right balance which is in line with its Ahvaan 2025 strategy.

Even as IHCL is getting ready to launch a new website and a new mobile app, the hospitality brand is clear that the backbone of the company was, is and in the foreseeable future remains the Taj.

“We are very clear that all brands associated directly or indirectly with the Taj are perceived as premium brands in their respective segment,” Chhatwal said during the first quarter earnings call.

“One thing which we have been very careful about in the last few years is the premiumization of our portfolio. Any business that we enter in we want our offering to be in the premium level in their relative positioning.”

The company’s long-term growth will also focus significantly on digital enablers such as the super app — Tata Neu. “The Tat Neu integration has enabled us to get one million new members in four months and a 50 percent growth in our loyalty base,” Chhatwal said.