CHL Limited , a prominent player in the hospitality sector, has announced its financial results for the second quarter ended September 30, 2025. The company reported a standalone net loss of ₹444.27 crore for the quarter, a significant shift from the profit of ₹50.40 crore in the previous quarter. This change in financial performance comes amidst a challenging period for the company, marked by a substantial one-time expense related to a property tax settlement.

Key Financial Highlights

Property Tax Settlement

A significant development during the quarter was the settlement of a long-standing property tax dispute. CHL Limited paid ₹106.22 crore to the Municipal Corporation of Delhi under a one-time amnesty scheme, following an order from the Delhi High Court dated September 12, 2025. This substantial payment was charged to operational expenses as a non-recurring item, significantly impacting the company's quarterly results.

Operational Performance

Despite the reported loss, CHL Limited's revenue from operations showed resilience, with a marginal increase to ₹202.71 crore in Q2 FY2026, compared to ₹197.11 crore in the previous quarter. However, this figure is lower than the ₹237.16 crore reported in the same quarter of the previous fiscal year.

EXIM Bank Loan Settlement

The company continues to navigate the complexities of an ongoing litigation involving EXIM Bank. A One Time Settlement (OTS) of USD 34 million has been agreed upon and is currently under implementation. This settlement relates to a USD 32.50 million loan taken by CHL Limited's subsidiary, CJSC CHL International. The case is pending before the Supreme Court of India and the Debt Recovery Tribunal.

Subsidiary Performance

CJSC CHL International, the company's subsidiary, reported total assets of ₹2,357.74 crore and a net loss of ₹75.93 crore for the quarter. The consolidated results reflect the challenges faced by both the parent company and its subsidiary.

Looking Ahead

While the property tax settlement has resulted in a significant one-time expense, it resolves a long-standing issue for CHL Limited. The company's ability to marginally increase its operational revenue quarter-on-quarter in a challenging environment suggests underlying resilience in its core business.

The ongoing implementation of the EXIM Bank loan settlement is a critical area to watch, as its resolution could have substantial implications for the company's financial position and future growth prospects.

Investors and stakeholders will be keenly observing how CHL Limited navigates these challenges and capitalizes on potential opportunities in the coming quarters.

CHL Limited , a prominent player in the hospitality sector, has encountered a significant legal setback in its battle against the Municipal Corporation of Delhi (MCD) regarding property tax on hotels. The Delhi High Court has ruled against the company in a long-standing dispute over differential property tax rates imposed on hotels in the national capital.

Court Decision

The Delhi High Court disposed of a writ petition (W.P.(C)-17113/2004) filed by CHL Limited. The company had challenged a notification issued under the Delhi Municipal Corporation Act, 1957, which pertained to the imposition of differential property tax rates on hotels by the MCD. The court's decision was unfavorable to CHL Limited, effectively upholding the MCD's authority to levy such taxes.

Financial Implications

In a disclosure to the Bombay Stock Exchange (BSE), CHL Limited stated that it is currently assessing the financial impact arising from this court order. The company's management is likely conducting a thorough analysis to determine how this ruling will affect its tax obligations and overall financial position.

Legal Challenge

CHL Limited's legal challenge, which dates back to 2004, demonstrates the long-standing nature of this dispute. The company's attempt to contest the differential property tax structure for hotels in Delhi has been a protracted legal battle, spanning over two decades before reaching this conclusion.

Industry Implications

This ruling could have broader implications for the hospitality industry in Delhi. Other hotel operators in the region may need to reassess their tax strategies and financial planning in light of this precedent-setting decision.

Company's Response

Ayush Rai, Company Secretary of CHL Limited, confirmed the court's decision in the regulatory filing. The company has not yet provided specific details on its next steps, such as whether it plans to appeal the decision or how it intends to adjust its operations in response to the ruling.

Investor Considerations

Shareholders and potential investors of CHL Limited should closely monitor further announcements from the company regarding the financial impact of this court decision. The outcome may influence the company's profitability and operational strategies in the Delhi market.

As the hospitality sector continues to navigate regulatory challenges, this case underscores the importance of staying abreast of legal and tax-related developments that can significantly impact business operations and financial performance.