IHCL Reports Over Three-Fold Increase in Q2 Net Profit to Rs 582.71 Crore Driven by Strong Demand

Indian Hotels Company Ltd (IHCL) announced a significant increase in its consolidated net profit, reaching Rs 582.71 crore for the second quarter of 2024-25. This marks a more than threefold rise compared to Rs 178.97 crore in the same period last year. The surge was driven by robust demand and notable gains from consolidating its air and institutional catering business segment, TajSATS.

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Revenue from operations for IHCL rose to Rs 1,826.12 crore during the June-September quarter, up from Rs 1,433.20 crore in the previous year’s corresponding period. However, expenses also increased to Rs 1,502.01 crore from Rs 1,248.68 crore a year earlier. Puneet Chhatwal, Managing Director & CEO of IHCL, noted that the second quarter saw a strong demand recovery, leading to a 28% overall revenue growth and a 16% increase in the hotel segment.

Strong Growth and Future Plans

Chhatwal highlighted that IHCL achieved its best-ever Q2 Consolidated EBITDA margin at 29.9%. He stated, "For FY2025, we continue to maintain guidance of double-digit revenue growth led by the sustained growth in new businesses, not like for like growth and healthy same-store performance." He also mentioned a 16.5% growth in consolidated hotel segment revenue in October, which is expected to accelerate further in Q3.

IHCL is set to manage The Claridges hotel in New Delhi under a hotel operating agreement starting April 2025. Additionally, the company has entered into agreements to acquire a majority stake in Tree of Life brand holding company, enhancing its boutique leisure offerings. Chhatwal shared that IHCL plans to continue signing and opening new properties, with 25 hotels expected to open this fiscal year.

Sector Trends and Outlook

The hospitality sector typically sees its weakest performance in Q2 and strongest in Q3. Chhatwal explained that Q3 ranks first in terms of revenue and profitability contribution, followed by Q4, Q1, and then Q2. He remarked on the unusual success of this year's Q2 due to post-election activities and extreme heat conditions.

Looking ahead, Chhatwal expressed optimism about the current momentum, stating that demand continues to surpass supply. "Our growth is phenomenal," he said. "We are opening more than two hotels a month and believe we will continue growing our top line while maintaining or even increasing our margins."

Regarding the Sea Rock project, Chhatwal mentioned ongoing efforts with the government to secure necessary permissions by the end of this year or early next year.