EIH Hotels , a leading player in the Indian hospitality sector, has reported robust financial results for the first quarter ended June 30, despite facing geopolitical headwinds. The company showcased resilience by achieving its highest revenue and EBITDA for Q1 in recent years, overcoming challenges posed by Operation Sindoor and tensions in the Middle East.

Key Financial Highlights

• Revenue per Available Room (RevPAR) grew by 16% year-over-year to INR 11,350.00
• Average Room Rate (ARR) increased by 18%
• Occupancy remained steady at 70%
• Consolidated revenue grew by 9%
• EBITDA margin improved to 32% from 30% in the previous year

Performance Drivers

The company's strong performance was primarily driven by:

1. Robust ARR Growth: The 18% increase in ARR was the main contributor to the RevPAR growth, offsetting flat occupancy rates.

2. Efficient Cost Management: While consolidated revenue grew by 9%, expenditure increased by only 6%, leading to improved EBITDA margins.

3. International Hotel Performance: The company's international properties showed strong performance with a 22% RevPAR growth, benefiting from recovery in Egypt and Marrakesh.

Challenges and One-time Impact

Despite the overall positive performance, EIH Hotels faced some challenges:

• Operation Sindoor and Middle East geopolitical tensions impacted the hospitality industry.
• The company recorded a one-time exceptional charge of INR 110.00 crores related to the Mashobra court judgment, resulting in a 62% decline in Profit After Tax (PAT).

Future Outlook and Expansion Plans

EIH Hotels remains optimistic about the growth prospects of India's hospitality sector. The company has outlined its expansion strategy:

• A pipeline of 25 new properties with 2,033 keys, primarily in India
• These new properties are expected to be operational by 2030
• The expansion focuses on driving average room rates in the premium segment

Management's Perspective

Mr. Vikram Oberoi, MD & CEO of EIH Hotels, expressed confidence in the company's performance and future prospects during the investor call. He emphasized the company's focus on maximizing rates across their hotels, particularly in city locations where demand remains strong.

Mr. Oberoi stated, "Our endeavor is to drive rate when demand is strong across every single hotel. And in fact, our leisure hotels offer a level of product and service, which is unmatched at global standards, and therefore, operate at much higher rates."

The management remains committed to its Vision 2030, aiming to double the room count and capitalize on the growing Indian economy and increasing demand for high-end experiences in the hospitality sector.

In conclusion, EIH Hotels' Q1 results demonstrate the company's ability to navigate challenges while maintaining growth and profitability. With its strong brand presence in the premium segment and ambitious expansion plans, EIH Hotels is well-positioned to benefit from the positive outlook for India's hospitality industry.

EIH Hotels , the hospitality giant behind the Oberoi and Trident hotel chains, has reported a robust performance for the first quarter, showcasing resilience and growth in the luxury hospitality sector.

Financial Highlights

EIH Limited's consolidated revenue for Q1 grew by 9% to ₹573.60 crores, while standalone revenue increased by 14% to ₹518.80 crores. The company's EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) saw a significant rise, with consolidated EBITDA up by 16% to ₹195.30 crores and standalone EBITDA surging by 28% to ₹193.50 crores.

However, the company's profit after tax (PAT) experienced a notable decline due to exceptional items amounting to ₹110.50 crores. As a result, the consolidated PAT stood at ₹36.90 crores, compared to ₹96.70 crores in the previous year.

Operational Performance

EIH Limited maintained strong operational metrics, with RevPAR (Revenue Per Available Room) showing an impressive growth of 11-13% year-over-year. The company's average room rates also saw a healthy increase of 9-11% compared to the same period last year.

Notably, the luxury segment under 'The Oberoi' brand demonstrated particularly strong performance, with a remarkable 21% growth in RevPAR. This underscores the company's strength in the high-end hospitality market.

Expansion Plans

EIH Limited has outlined an ambitious expansion strategy, aiming to add 25 new properties to its portfolio by 2030. These new additions will comprise 2,033 keys across both domestic and international markets, significantly expanding the company's footprint.

The expansion plan includes:

• 15 new 'The Oberoi' hotels
• 7 new 'Trident' hotels
• 3 luxury boats and Nile cruisers

Of the planned properties, 16 will be in domestic locations, while 9 will be international. The company plans to own 8 of these properties, while 17 will be managed properties.

Market Position and Outlook

EIH Limited continues to outperform industry benchmarks across key operational metrics. The company maintains a healthy liquidity position, which is crucial for supporting its long-term growth plans.

The Indian hospitality sector is poised for significant expansion, driven by growth in domestic tourism, corporate travel, and the MICE (Meetings, Incentives, Conferences, and Exhibitions) segment. Key growth drivers include spiritual tourism, live events, culture and heritage tourism, and infrastructure development.

Management Commentary

In their investor presentation, EIH Limited's management expressed optimism about the future, stating, "We continue to observe year-on-year increase in average rates across all regions. We expect demand for high-end luxury to grow in India, and our iconic portfolio of luxury hotels & resorts in premier destinations uniquely positions us to capture India's evolving opportunities."

As EIH Limited navigates the dynamic hospitality landscape, its strong Q1 performance and ambitious expansion plans signal a confident outlook for the company's future growth and market position in the luxury hospitality sector.