Mahindra Holidays & Resorts India Limited (MHRIL) has reported strong financial performance and ambitious expansion plans, signaling confidence in the hospitality sector's recovery.

Financial Performance

MHRIL has posted impressive financial results:

The company's consolidated profit saw a significant increase of 18%, rising to ₹7.20 crore compared to ₹6.10 crore in the same quarter of the previous year. Total income also showed healthy growth, increasing by 8% to reach ₹740.20 crore, up from ₹686.10 crore.

Expansion Plans

MHRIL has set ambitious targets for expansion:

• Add 1,000 rooms by March 2026
• Reach 10,000 keys by FY30

Currently, MHRIL operates 126 resorts with a total of 5,794 keys. The company has multiple projects in the pipeline across various states including Maharashtra, Goa, Rajasthan, Madhya Pradesh, and Puducherry.

Membership Growth

The company added 3,000 new members in the quarter and expects to maintain this pace of membership growth in the future.

Operational Overview

• Indian operations performed well
• International operations remain stable but face challenges
  • Impacted by the Finnish economy
  • Affected by geopolitical uncertainties

Future Outlook

MHRIL aims to maintain double-digit consolidated profit growth in the coming periods, building on its current performance and expansion strategy.

The company's focus on expanding its room inventory, coupled with steady membership growth, positions it to capitalize on the recovering hospitality sector. However, challenges in international operations, particularly in Finland, and broader geopolitical uncertainties may require careful navigation in the near term.

Mahindra & Mahindra , one of India's leading private sector banks, reported a significant decline in its standalone net profit for the June quarter. The bank's performance fell short of market expectations, raising concerns about its asset quality and provisioning.

Key Highlights

• Net profit declined 57.5% year-on-year to ₹3,281.70 crore
• Provisions surged to ₹1,207.76 crore from ₹578.48 crore a year ago
• Gross non-performing assets (NPA) ratio increased to 1.48%
• Deposit growth was 15% year-over-year with CASA ratio at 40.9%

Financial Performance

Kotak Mahindra Bank's standalone net profit for the quarter stood at ₹3,281.70 crore, marking a substantial 57.5% decrease from ₹6,250.00 crore in the same period last year. This figure fell short of analyst estimates, which had projected a net profit of ₹3,442.00 crore.

Asset Quality Concerns

The bank's asset quality showed signs of deterioration during the quarter. The gross non-performing assets (NPA) ratio increased to 1.48% from 1.42% in the previous quarter, indicating potential stress in the loan portfolio.

Increased Provisions

One of the key factors contributing to the profit decline was the sharp increase in provisions. The bank's provisions surged to ₹1,207.76 crore, compared to ₹578.48 crore a year ago. This significant rise in provisions suggests that the bank is taking a cautious approach in light of potential risks in its loan book.

Management Commentary

Managing Director Ashok Vaswani provided insights into the bank's performance:

• Stress in the microfinance portfolio likely peaked in the June quarter
• Credit costs are expected to ease from the second quarter
• The bank faced higher credit costs in retail commercial vehicle loans due to economic headwinds
• Disbursements in the commercial vehicle segment have been tightened

Positive Developments

Despite the challenges, there were some positive aspects to the bank's performance:

• Deposit growth was strong at 15% year-over-year
• CASA (Current Account Savings Account) ratio stood at a healthy 40.9%
• The bank restarted credit card issuance after an RBI embargo was lifted

Outlook

The significant drop in quarterly profits and the increase in NPAs may raise concerns among investors about the bank's near-term performance. However, the management's expectation of easing credit costs from the second quarter onwards provides some optimism.

As the economic environment remains challenging, particularly in segments like microfinance and commercial vehicle loans, Kotak Mahindra Bank may face headwinds in maintaining asset quality and profitability. Investors and analysts will likely keep a close watch on the bank's performance in the coming quarters to assess its ability to navigate through these challenges and return to a stronger growth trajectory.

The bank's strong deposit growth and healthy CASA ratio, coupled with the resumption of credit card issuance, could provide some support to its business in the coming quarters.