Indian Hotels Co Ltd consolidated net profit of Rs15.26cr in Q1FY19, vs net loss of Rs24.96cr in Q1FY18: In-line with Estimates

The company’s consolidated revenue in the period stood at Rs979.70cr, up 7.52% yoy but down 14.32% qoq.

Aug 10, 2018 01:08 IST India Infoline Research Team

Indian Hotels Co Ltd Q1FY19

Consolidated Results Q1FY19: (in Rs cr)

Q1FY19 YoY (%)
Revenue 979.70 7.5
EBITDA 110.66 22.2
EBITDA Margin (%) 11.3 136
Net Profit (adjusted) 15.26 -
***EBITDA margin change is bps
The Indian Hotels Company Ltd's consolidated revenue for Q1FY19 came in at Rs979.70cr, up 7.5% yoy. The operating profit for the quarter came in Rs110.66cr, up 22.2% yoy. The operating EBITDA margin expanded by ~136bps yoy to 11.3% in Q1FY19. The adjusted net profit attributable to owners for Q1FY19 stood at Rs15.26cr as against a net loss of Rs24.96cr in Q1FY18. The revenue, operating profit, and net profit were in-line with the estimates of Rs970cr, Rs104cr, and Rs15cr, respectively.

• Indian Hotels (IHCL) has signed a new Vivanta Hotel at London Heathrow Airport with 108 rooms. It has also won bid for The Connaught in Lutyens, New Delhi.
• IHCL witnessed an increase in RevPAR by ~6% yoy during the quarter, which is seasonally a slow quarter for the hospitality industry. This is driven by growth in the industry and market share gains by the company brands.
• The company has signed six new hotels with an inventory of ~800 rooms across all brands in key locations in India and overseas. IHCL has signed its first hotel in Makkah, Saudi Arabia. The hotel will be a Taj-branded hotel and is scheduled to open in January 2023 with ~340 rooms. The other signings included a Taj hotel in Lonavala, a Vivanta hotel in Katra, J&K, and two Ginger hotels in Jhansi and Visakhapatnam, respectively.
• The company has also announced a major expansion of Taj Bangalore located across the International Airport with an addition of 220 guest rooms; bringing it to a total of 374 rooms.
• The EBITDA margin expansion is on account of increase in RevPAR and cost optimization. The employee benefits expense and other expenses increased marginally by ~6% yoy.
• Finance cost of the company reduced significantly by 32% yoy to Rs46.94cr in Q1FY19. This led to lower drag in the net profit of the company as compared to the previous period.
• The other incomes stood at Rs15.01cr in Q1FY19 vs Rs8.80cr in Q1FY18, leading to higher net profit for the quarter.
• There was a reversal of deferred tax during the quarter of Rs22.45cr, resulting in higher net profit as compared with the previous period.
• The exceptional item for the quarter included:
o Incentive fees received by the group on an amendment to management service agreement of Taj Boston, USA, amounting to Rs46.26cr;
o Loss on change in fair value on cross currency swap derivative contracts for the quarter of Rs50.17cr;
o Write off by an international subsidiary amounting to Rs0.57cr.

Technical View:

Indian Hotels Co Ltd is currently trading at Rs123.90, down 3.9 points, or 3.05%, from its previous close of Rs127.80 on the BSE. The scrip opened at Rs128.05 and has touched a high and low of Rs129.30 and Rs123.10, respectively. A total of 14,32,181 (NSE+BSE) shares were traded on the counter. The stock is currently trading above its 100 DMA.

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