IHCL posts record profit of Rs 1053 cr in FY23; revenue from operations at Rs 5810 crore

Tata Group-backed Indian Hotels Company (IHCL) swung to a record profit of Rs 1053 crore in the financial year 2023, compared to a loss of Rs 265 crore in the financial year 2022.

The chain's revenue from operations was at Rs 5810 crore in the financial year 2023, up 90% from the financial year 2022.

The chain posted revenue from operations of Rs 1625.4 crore in quarter four of the financial year 2023, up 86% from quarter four of the financial year 2022. IHCL posted a profit of Rs 339 crore in the fourth quarter of the financial year 2023, compared to a profit of Rs 72 crore in quarter four of the financial year 2022.

IHCL MD and CEO Puneet Chhatwal said the profit after tax numbers for the chain were higher than the profit after tax numbers of the three best financial years put together.

The chain’s cumulative profit after tax for financial years 2006, 2007, and 2008 was Rs 974 crore.

“IHCL achieved a record-setting year with a number of significant accomplishments including the highest ever full-year consolidated revenue, an all-time high and industry-leading EBITDA margin and a profit after tax of over Rs 1,000 crore, a historic first for the company,” he said.

“This performance was enabled by consecutive four quarters of sustained high demand, additionally bolstered by IHCL demonstrating revenue per available room (RevPAR) leadership across its brandscape in all its key markets,” he added.

He said factors such as demand outpacing supply, a strong growth of the existing portfolio as well as asset management and upgradation of existing hotels, and a strict control on costs contributed to the chain posting these record numbers.

IHCL crossed over 260 hotels in its portfolio including 36 signings at a rate of 3 hotels a month and 16 openings or a new hotel every three weeks in the year.

“IHCL’s vast footprint now covers 31 states and union Territories in India. We were also able to achieve an optimal 50:50 mix between our owned/leased and managed hotels,” Chhatwal said.

Giridhar Sanjeevi, executive vice president and chief financial officer at IHCL said robust demand across markets and segments has led to all group companies reporting a full year positive profit after tax in domestic operations.

“Growth in same store performance supported by margin enhancing new businesses and asset light growth has led to a record EBITDA margin of 32.7%, an 8.7 percentage points expansion over financial year 2019-20,” he said.

“This has been made possible by maximising operating leverage of our owned and leased hotels and margin enhancing fee-based business. IHCL continues to report a healthy consolidated free cash flow of Rs 1,017 crore in financial year 2022- 23 and remains net cash positive,” he added.

IHCL said its flagship brand Taj has reached a portfolio of 100 hotels and has more than doubled its room inventory over the past five years.

The company said Ginger Hotels reported a turnaround in the financial year 2022-23, led by a 50% lean luxe portfolio. The company clocked revenue of Rs 307 crore, an EBITDA margin of 37.4% and a profit before tax of Rs 48 crore. Airline catering company TajSATS captured a market share of 58% in financial year 2022-23, clocking a revenue of Rs 641 crore, a 53% growth over pre-Covid, an EBITDA margin of 19.7% and a profit before tax of Rs 107 crore.

Under the chain’s new businesses, Qmin grew to 34 outlets with a presence across 24 cities and ama Stays & Trails has witnessed a 42% growth in its portfolio in fiscal year 2023 reaching 114 bungalows across over 50 locations.