Indian Hotels Company lifted its full-year revenue growth guidance after stronger occupancy, room rates, major events and renovated properties drove a better-than-expected second quarter.
Indian Hotels Company delivered a stronger-than-expected second quarter, with demand from domestic travellers, large events and renovated properties helping to lift revenue and profitability, according to Business Standard and company disclosures cited in brokerage research. The performance was anchored by the standalone hotels business, where higher occupancy and room rates pushed results well ahead of estimates and prompted management to lift its full-year revenue growth outlook.
Consolidated revenue rose 22% from a year earlier to ₹2,484.2 crore in the quarter, ICICIdirect Research said, citing the company’s results. That was driven by a 27% jump in revenue per available room, or RevPAR, a closely watched measure that combines occupancy and pricing. Occupancy rose from 75% to 82%, while average room rates increased 17%, reflecting firmer pricing power as demand remained resilient through the quarter.
The company also benefited from a healthier mix of business. According to the company’s earnings call transcript, demand from meetings, incentives, conferences and exhibitions, or MICE, was strong, with events such as the BRICS Summit supporting room demand. Renovations at key hotels across the portfolio also helped occupancy and revenue, while management fees rose 16% year on year. The company has now raised its FY27 revenue growth guidance to 15% to 17%, up from its earlier outlook, after a strong first half and improved visibility into the seasonally stronger second half.
Profitability improved as well. Consolidated operating profit increased 24% and margins widened by 50 basis points to 28.4%, helped by a sharper rise in the standalone hotels business, where operating margins reached 38.9% compared with 34.9% a year earlier. ICICIdirect said room revenue in the standalone segment rose 27%, while food and beverage revenue climbed 20%, underscoring the broad-based nature of the recovery.
Not every part of the group moved in step. TajSATS, the company’s airline catering arm, saw operating profit fall 25% year on year, weighed down by weaker air traffic after disruptions in West Asia. The company also said some subsidiaries were affected by renovations and the regional conflict. Even so, brokers remain constructive. Elara Research, 360 ONE Capital Research and Motilal Oswal Research have all retained buy ratings, arguing that a persistent gap between hotel room supply and demand, a robust room pipeline and rising MICE activity should support further growth over the medium term.
Analysts are also pointing to the broader industry backdrop. ICRA said healthy domestic demand, especially from leisure, corporate and MICE travel, supported hotel occupancies and pricing in September, while it expects the wider hospitality industry’s revenue to rise 7% to 9% in 2026-27. For Indian Hotels, that environment has been enough to keep sentiment positive: the shares, trading near ₹781, have risen about 23% over the past six months, as investors wager that strong demand and limited supply growth can keep earnings moving higher.
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