New Delhi Tata Group-owned Indian Hotels Co Ltd is gearing up for aggressive expansion after delivering its best ever quarterly performance with nearly 500 per cent year-on-year revenue growth in the June quarter.
The growth of the domestic travel industry has been driving the company’s strategy in brands such as Taj Hotels, Ginger and Selections ever since the pandemic-induced lockdown was lifted. The group is looking to increase the number of hotels for each category and expand its footprint in Tier II and III cities including Manali, Bekal, Nainital, Tirupati, Kanpur and Udaipur. The firm has already signed management contracts for properties in the cities.
The company is also looking to increase its earnings from brands such as The Chambers and bespoke small-inventory hotel-managed entity M Stays & Trails before interest, taxes, depreciation, and amortization contributions.
While the Tata group company operates 242 hotels, work is underway on another 63. Its portfolio has a mix of owned, leased and managed properties at 54:46. Taj brand and budget brand Ginger Hotels each run 89 hotels, while Selections operates 28 hotels and Vivanta has 36 hotels.
On Monday, it announced its June quarter results. On a consolidated basis, its Q1 FY23 revenue was 1266.07 crore, from above 344.55 crore a year ago. it had profit after tax 180 crores as compared to the loss of 301.5 crore in Q1 FY22.
Puneet Chhatwal, Managing Director and CEO, IHCL said, “The Q1 FY23 performance was the best ever in the history of IHCL, and is a testament to our long-term focus on becoming the most profitable and reputed hospitality company in South Asia ” “The rapidly growing demand for travel across all regions is being led by domestic travel. Offerings and services will continue to be shaped by evolving travel trends while placing newer and lesser-explored destinations on the tourism map.”
“We will build a portfolio of 300 hotels by FY26 with 33% EBITDA margin and 35% ABITDA share contribution from new businesses and management fees,” Chhatwal said.
The company is looking to grow the flagship Taj brand to 100 hotels globally and 75 properties across the Vivanta and Salvation brands. The Ginger brand should be expanded to 125 hotels. “We overcame two years of Covid-related challenges to emerge profitable in the last two quarters of FY12.”
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