Indian Hotels Records Robust Q4FY24 Revenue Growth, Aims for Continued Momentum in FY25
Share
Indian Hotels (IH) has reported a substantial 17% year-on-year revenue growth in the fourth quarter of fiscal year 2024, primarily driven by a nearly 19% year-on-year revenue increase in its standalone business. This growth in standalone revenue can be attributed to improved occupancy rates, which rose by 440 basis points year-on-year, and average room rates (ARR) that increased by 4% year-on-year (8% excluding Ginger Santacruz). Additionally, standalone management contract revenue surged by 32% year-on-year to INR 1.5 billion.
Maintaining their estimates for fiscal years 2025 and 2026 EBITDA, analysts reiterate a BUY rating with a target price of INR 680 based on a sum-of-the-parts valuation.
The new and reimagined business segments of IH continue to exhibit robust growth. Consolidated revenue for the quarter grew by 17% year-on-year, while EBITDA increased by 23% year-on-year. Standalone revenue and EBITDA saw significant increases of 19% and 23% year-on-year, respectively. Despite a 3% quarter-on-quarter decline in ARR to INR 17,546, the company reported an overall RevPar growth of 10% year-on-year.
For IH’s subsidiaries, sales were INR 5.6 billion, up 14% year-on-year but down 17% quarter-on-quarter, while EBITDA stood at INR 737 million, up 27% year-on-year but down 58% quarter-on-quarter.
In fiscal year 2024, IH’s revenue, EBITDA, and adjusted PAT grew by 17%, 20%, and 26% respectively. The company’s new and reimagined business verticals, including Ginger, Qmin, amã Stays & Trails, The Chambers, and TajSATs, contributed INR 15.9 billion in revenue, showing a 35% year-on-year growth.
Looking ahead, IH expects sustained double-digit revenue growth in fiscal year 2025, with new businesses projected to grow by 30%. The company aims to maintain margins and plans to open approximately 25 hotels during the fiscal year.
Furthermore, IH will introduce its reimagined brand ‘Gateway’ in fiscal year 2025, with launches planned in Bekal and Nashik in the first quarter. The brand aims to scale up to 100 hotels by 2030.
Analysts anticipate continued strong momentum in fiscal year 2025, driven by various factors including increased ARR, sustained high occupancy levels, a robust room addition pipeline, and value unlocking through scaling up reimagined and new brands.
