Apeejay Surrendra Park Hotels reported a net profit of ₹115 million for the first quarter of FY27, down 14.2% from ₹134 million in the same period last year. Operating revenue rose 8.1% to ₹1,668 million, reflecting sustained demand across its hospitality portfolio. The company maintained an industry-leading occupancy rate of 92%, reinforcing its position in the upper upscale segment.

The decline in bottom-line profitability occurred despite top-line growth, primarily due to rising financial costs. Interest expenses jumped 60% to ₹104 million from ₹65 million in Q1FY26. Depreciation also increased by 16.6% to ₹211 million. These factors compressed the profit after tax (PAT) margin by 186 basis points to 6.70%, even as total EBITDA grew 8.4% to ₹517 million.

Operational Highlights

The hotel chain’s operational metrics remained robust during the quarter. Average room rates stood at ₹9,310, while revenue per available room (RevPAR) was ₹6,858. Food and beverage (F&B) contributed 43% of total revenue, consistent with recent quarters. The Flurys brand generated ₹200 million in income, maintaining stability after a peak of ₹261 million in Q3FY26.

What the Numbers Show

A significant divergence exists between operational efficiency and net profitability. While operational EBITDA margins contracted modestly by 137 basis points to 28.12%, the PAT margin fell sharply by 186 basis points. This gap indicates that non-operational factors, specifically the 60% rise in interest costs and increased depreciation, were the primary drivers of the profit decline rather than core business performance. The stable F&B revenue share of 43% suggests consistent guest spending patterns despite the broader margin pressure.

Strategic Developments

Management highlighted strong cash flow improvements from the sale of service apartments in its EM Bypass Kolkata project. Collections for the quarter stood at ₹213 million, with full-year expectations of approximately ₹800 million. The company has also implemented SAP S/4HANA Finance to enhance reporting capabilities. Looking ahead, Apeejay Surrendra Park Hotels plans to expand its portfolio to over 6,000 keys by FY30, focusing on asset-light managed properties and unlocking value from prime real estate holdings.

Apeejay Surrendra Park Hotels reported a first-quarter net profit of ₹11.49 crore for the quarter ended June 30, 2026, down from ₹13.42 crore in the corresponding period last year. While consolidated revenue grew 8.1% year-on-year to ₹166.78 crore, the company’s profitability faced headwinds as pre-tax profits declined despite operating leverage.

The hospitality firm logged an EBITDA of ₹51.65 crore for the quarter, up from ₹47.67 crore in the prior year. This represents an improvement in operating efficiency compared to the previous quarter, where EBITDA stood at ₹53.74 crore. However, the bottom-line impact was pronounced, with net profit declining by 14.4% despite higher revenues and improved operating margins.

Financial Performance

What the Numbers Show

The divergence between revenue growth and profit before tax highlights pressure on margins below the operating level. While top-line sales rose by over 8% and EBITDA expanded by 8.3%, profit before tax fell nearly 10%. This suggests that finance costs, depreciation, or other non-operating expenses increased disproportionately relative to operating gains. Additionally, other income more than doubled to ₹4.79 crore from ₹2.28 crore, indicating that non-operating contributions are becoming a larger component of total income, though this was insufficient to offset the decline in core profitability.

The unaudited consolidated financial results were reviewed by the Audit and Risk Management Committee and approved by the Board of Directors in their meeting held on August 14, 2026. The statutory auditors have expressed an unmodified opinion on these consolidated financial results.