Sayaji Hotels Ltd Management Discussions

[Pursuant to Regulation 34 read with Part B Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015]

Management Discussion and Analysis Report will provide details of performance of the Company as well as the Companys approach to sustainability and risk management. This report describes Companys objectives, projections, estimates and expectations, may constitute forward-looking statements within the meaning of applicable laws and regulations. Although the expectations are based on reasonable assumptions, the actual results might differ.

Industry Structure and Developments

India continues to stand out as one of the fastest-growing major economies globally, with its Real GDP growth estimated at 7% in FY 2024-25 and a projected growth rate of 6.5% in FY 2025-26. The countrys robust democratic framework, expanding digital infrastructure, rising middle class, and strategic policy initiatives have laid a strong foundation for sustained economic development. These macroeconomic fundamentals provide a favorable backdrop for the services sector, particularly the hospitality and tourism industries.

The Indian hospitality sector has shown strong recovery and resilience post-pandemic and is on an accelerated growth trajectory. The sector grew by approximately 12-15% in revenue during FY 2024-25, with national average occupancy levels reaching 68-72%, as per estimates by the Federation of Hotel & Restaurant Associations of India (FHRAI). Growth was driven primarily by a revival in domestic tourism, increased MICE (Meetings, Incentives, Conferences, and Exhibitions) activity, higher business travel, and a notable 10% uptick in foreign tourist arrivals.

Indias diverse tourism offerings · ranging from spiritual, wellness, heritage, and ecotourism to medical and adventure tourism · continue to attract both domestic and international travelers. International tourist arrivals are projected to reach 30.5 million by 2028, with revenues from visitor exports expected to exceed US$ 50.9 billion. Simultaneously, the domestic travel market, fueled by rising disposable incomes, improved connectivity, and the growth of Tier-II and Tier-III cities, is emerging as a dominant force, making India a large and vibrant travel market.

The hospitality industry structure in India is a mix of luxury, mid-scale, budget hotels, boutique accommodations, and emerging alternative lodging models such as homestays and vacation rentals. Notably, Tier-II cities have seen heightened activity, with increasing demand for quality hospitality infrastructure. The luxury and mid-segment hotel categories, where Sayaji Hotels Limited primarily operates, witnessed strong performance due to a surge in domestic travel and corporate movement in metro and emerging urban centers.

Key governmental initiatives such as DEKHO APNA DESH, infrastructural developments under BHARATMALA and UDAN schemes, enhanced visa processes, and increased airport capacity have played a pivotal role in boosting tourist traffic. Simultaneously, Indias digital leap · with over 300 million UPI users and being the third-largest digitally connected nation · has significantly contributed to online hotel bookings and enhanced guest experiences.

Despite these positive developments, the industry continues to face structural and operational challenges. Rising input costs (including food, labor, and utilities), competitive pricing pressures, and the growing popularity of tech-driven alternative accommodation platforms require hospitality players to constantly innovate and enhance value propositions. Moreover, staffing shortages and skill development remain areas of concern that need strategic attention.

Looking ahead, the Indian hospitality sector is expected to remain a key pillar of the services economy. The hotel market, valued at USD 35 to 37 billion in FY2024, is projected to grow to USD 52 billion by FY27, supported by sustained growth in leisure and business travel, expansion of branded hotel chains, and increasing foreign investments. International hotel chains are expected to command around 47% market share by 2028, further intensifying competition while raising service standards.

With a long-standing presence in the Indian hospitality landscape, Sayaji Hotels Limited continues to leverage these sectoral trends through strategic expansion in high-growth urban centers and an enhanced focus on personalized guest experiences, technology integration, and operational excellence.

Safety and Hygiene

In the post-pandemic era, heightened awareness around hygiene, cleanliness, and safety has reshaped guest expectations in the hospitality sector. These elements are no longer viewed as background processes but have become defining attributes of the overall guest experience. As travel confidence continues to rebuild, hotels are expected to demonstrate·not just deliver-rigorous safety protocols and health-conscious practices.

During the financial year 2024-25, Sayaji Hotels Limited maintained an uncompromising focus on health and hygiene, embedding them into every aspect of operations. From guest arrival to departure, proactive communication and visible safety assurances remained central to enhancing guest trust and comfort.

The Company has institutionalized robust Standard Operating Procedures (SOPs) aligned with national and global benchmarks, including FSSAI guidelines and World Health Organization (WHO) recommendations. Periodic external audits and internal quality checks ensured sustained compliance and operational excellence.

Key practices included:

• Deployment of contactless technologies for check-in, billing, and in-room services

• Regular sanitization of high-contact zones using hospital-grade disinfectants

• Enhanced air quality management through HEPA filtration systems

• Mandatory health and hygiene training for all frontline staff

• Digital display of hygiene ratings and certifications at each property

In addition, feedback loops were strengthened through real-time guest surveys, helping us identify and respond to specific safety concerns swiftly and effectively.

As industry standards continue to evolve, third-party hygiene certifications and transparent operational practices are playing a growing role in influencing guest booking decisions. Sayaji Hotels remains steadfast in its commitment to surpassing basic compliance-striving to establish new benchmarks in hospitality hygiene and guest well-being. These ongoing initiatives have significantly enhanced brand credibility and contributed to increased guest loyalty, with a noticeable rise in retention and repeat visits from health-conscious travelers.

Green and Sustainable Tourism

Sustainability is no longer a peripheral consideration · it has become a defining expectation among todays travelers. Guests, especially from the younger demographic including Generation Z, increasingly prefer hotels that demonstrate a genuine commitment to ecofriendly practices across operations. Sayaji Hotels Limited recognizes this shift and has strategically integrated environmental responsibility into its core business philosophy.

During FY 2024-25, the Company took proactive steps to enhance its sustainability efforts · ranging from energy-efficient infrastructure improvements such as the installation of solar panels and adoption of LED lighting systems, to greater emphasis on waste reduction and water conservation measures. Our Food & Beverage operations have also embraced this movement, with expanded vegetarian and vegan menu options designed to meet evolving consumer preferences.

While the COVID-19 pandemic briefly redirected focus toward hygiene and health safety, environmental sustainability has firmly re-emerged as a key pillar of our operational priorities. At Sayaji Hotels, we believe that true hospitality extends beyond guest comfort to include care for the communities we serve and the environment we inhabit.

As sustainable tourism gains further momentum, Sayaji Hotels remains committed to responsible growth ensuring that our initiatives benefit not only our guests and business stakeholders, but also contribute meaningfully to the well-being of the broader ecosystem.

Customization through Digitalization

A trend that will become more important than ever is customization. However, this does not necessarily mean in personal conversation. It is much more a matter of creating a unique and individual experience for the guest. In order for the stay to be extraordinary, however, it takes more than just basic standards such as free Wi-Fi or a bottle of free water in the room. Guests want to be excited, both digitally and personally.

Act Globally and Think Locally

In a world so connected by business and economic ties, it only makes sense that globalization would have implications in the hotel industry. As globalization drives incomes in countries around the world, more people can afford to travel, which means that hotels face opportunities and challenges that come with accommodating new travelers from different places. Along with this rising middle class, increased income inequality further distances the highest earners from the rest. Luxury travelers continue to have an appetite for over-the-top experiences. Like domestic travelers, International Guests are interested in local attractions and regional delicacies. Bring your surroundings to life and encourage your guests to become familiar with their local people.

In this context, it is necessary to stress the need for collaboration. Through cooperation, be it with regional farmers, local excursion destinations or with technology providers, you can create a network to meet the changing guest needs. In addition, this is the only way to create truly local experiences and at the same time generate synergy effects. Whole regions, guests and your wallet can benefit from more cooperation.

New concepts in our Industry

In addition to the classic hotel, a large number of new, alternative types of accommodation have developed on the market in recent years. Boarding houses, services apartments, coliving spaces for remote workers or single travelers are just a few examples of these alternatives.

Soon these will no longer be alternatives, but a part of the standard as well as classic hotels. Because one thing is clear, the longer hotels are empty, the more money is lost. And that is precisely why more and more experienced hoteliers are looking for creative ways to fill their hotel again and use the rooms for other purposes.

Innovations like BLEISURE (business + leisure) stays, co-living hotel spaces, and wellness retreats gained traction. Industry-wide, experiential travel (e.g., culinary tours, heritage stays) is redefining hospitality offerings.

New Preferences

Smart Rooms - The internet of things is spreading not only into homes, but also into hotel rooms. From access to streaming services to a room key on your smartphone, the essential hotel amenities in a guestroom are becoming increasingly digital. Guests want concierge services or temperature controls at the push of a button (or tap of a finger), and voice- activated controls are expanding beyond simply asking Alexa to play your favorite song. These trends might sound futuristic now, but in a few years, guests will expect them. Many of these innovations require only minimal changes to a modern guestroom, so a forwardthinking hotelier can implement them quickly and efficiently.

Changing Workforce - While an increasingly digital world means that an employees tasks are changing, the workforce itself is changing too. These changes arent only in demographics, driven by the rise of Generation Z and a more global workforce, but also evident by a growing focus on safety, unionization, "gig" work, and human resources technology. Hoteliers must be cognizant to these changes in the workforce in order to hire effectively, reduce turnover, and keep employees safe and happy.

Desired travel destinations are also changing. Currently, international air travel and global luxury cruises do not belong to the wish lists of guests. Tourists are now looking increasingly for more regional and national experiences. In addition, the trend in the hospitality sector towards online bookings will continue. The uncertainty that currently prevails among guests when it comes to traveling has a significant impact on the travel destinations and travel arrangements. Last-minute trips and flexible cancellations conditions will also be increasingly popular in 2025. Similar to previous survey findings, around 60% of respondents agreed they would be willing to pay for flexibility with their accommodation booking. A preference for flexibility may be an enduring outcome of the pandemic as consumers, some who were perhaps short-changed due to travel disruption and cancellations during the pandemic, seek an extra layer of protection in a new age of travel.

Opportunities and Threats

The Indian hotel industry is witnessing a pivotal shift driven by rapid digital transformation. The integration of smart technologies · such as contactless check-in/check-out systems, AI- enabled guest support, mobile applications, and intelligent room automation·has opened new avenues for operational efficiency and enhanced guest experiences. These innovations are not only helping hotels meet the post-pandemic demand for safety and convenience but are also creating new revenue streams and brand differentiation opportunities.

Evolving consumer behavior, particularly among younger, tech-savvy travelers, presents another significant opportunity. There is a growing demand for personalized, seamless, and technology-driven hospitality experiences. Hotels that respond to this demand with innovative guest engagement tools and digital service platforms are better positioned to build loyalty and improve occupancy rates.

Sustainability also continues to gain momentum as a long-term strategic opportunity. Environmentally conscious travelers increasingly prefer properties that adopt green practices · ranging from energy-efficient infrastructure and reduced plastic usage to plant- based food offerings and waste management. Hotels embracing these trends not only align with global sustainability goals but also enhance their appeal to a growing niche of eco-aware customers.

Furthermore, the sector continues to serve as a vital employment generator in India, especially for youth, women, and workers in semi-urban regions. With the right investment in skill development and community engagement, the industry has the potential to play a transformative role in inclusive growth and social development while simultaneously strengthening its own human capital.

However, the industry also faces notable threats. A major concern is the digital capability gap, particularly among smaller or unorganized hotel operators who may lack the infrastructure, expertise, or financial capacity to adopt and sustain new technologies. Without adequate digital transformation strategies, these businesses risk falling behind in an increasingly competitive market.

Additionally, while technology enables efficiencies, over-reliance without proper integration or staff training may lead to inconsistencies in service delivery. This could negatively impact the personalized experiences that many guests still value, particularly in the premium hospitality segment.

The high cost of implementing advanced technologies is another barrier, especially for midsized and budget hotels still recovering from the financial setbacks of the pandemic. Without external support or scalable solutions, these players may struggle to match the pace of innovation in the industry.

Finally, not all digital solutions are universally applicable. A mismatch between the technology implemented and the hotels target audience or operational model may lead to underutilization, guest dissatisfaction, and a poor return on investment. Strategic evaluation and selective adoption remain crucial to ensure that innovation truly benefits both operations and guest satisfaction.

OPPORTUNITIES	THREATS
> Re-think business model	> Global economic uncertainty and reduced disposable income.
> Innovation and digitalization
> Sustainability and eco-friendly tourism	> Climate change and environmental risks
> Growth in wellness, rural, and nature- based segments	> Travel restrictions imposed by Foreign Nations
> Progress in destination-level adaptation plans	> Changing travel patterns and preferences
> Use of Artificial Intelligence in guest services	> High cost of technology adoption
	> Talent shortages and digital skill gaps
> Rise in domestic and regional tourism	> Increasing competition and market saturation

Segment-wise or Product-wise Performance

Your Company operates in the hospitality sector, offering a comprehensive range of services including accommodation and food & beverage provisions to its guests. The Company operates under a single business segment, and the comparative financial performance for the Financial Year 2024-25 has been provided in detail in the Financial Statements forming part of this Annual Report. Further information regarding the adequacy of internal control systems and key developments in the area of human resources is available in the Directors Report, which also forms an integral part of this Annual Report.

Global and Domestic Outlook

The global Hotel Industry in FY 2024-25 continues to benefit from a steady post-pandemic recovery, underpinned by stronger travel demand, evolving consumer preferences, and rapid technological adoption. In 2024, the global hospitality market (covering both lodging and food & beverage services) was valued at approximately USD 5.38 trillion, and is projected to grow at a CAGR of 6.1%, reaching around USD 7.24 trillion by 2029. Meanwhile, the broader travel and tourism sector is estimated to contribute about USD 11.1 trillion to world GDP in 2024, representing roughly 10% of global economic output

Leisure and BLEISURE Travel: Leisure travel remains the cornerstone of global hotel demand, bolstered by high-income households and the growing trend of "BLEISURE" (business + leisure) travel. Major events such as the 2024 Summer Olympics in Paris and the UEFA European Football Championship in Germany have significantly boosted occupancy and average daily rates (ADR) in Europe, setting a positive tone for 2025.

International Tourism Recovery: International tourist arrivals are expected to reach prepandemic levels by the end of 2025, with Asia-Pacific markets, including India, benefiting from increased air connectivity and a rebound in long-haul travel from North America and Europe. The World Travel & Tourism Council (WTTC) estimates that the sectors contribution to global GDP reached USD 11.1 trillion in 2024, rising further in 2025, reflecting its critical economic role.

Sustainability and Technology: Hotels worldwide are increasingly adopting sustainable practices and contactless technologies to meet guest expectations and comply with stricter environmental, social, and governance (ESG) regulations. Personalization through artificial intelligence (AI) and data analytics is enhancing guest experiences, while rising costs of capital are prompting a shift toward asset-light models like management contracts.

Challenges: Despite the optimistic outlook, challenges persist. Inflationary pressures, geopolitical uncertainties, and a strong US dollar are tempering international inbound travel to certain markets. In the Asia-Pacific region, airline capacity remains 10-15% below 2019 levels, though this gap is expected to narrow by mid-2025, supporting further growth.

Global Revenue Per year is expected to grow modestly in 2025, at around 1%-3%, with CBRE estimating a baseline of 1.3%, supported by gradual gains in occupancy and ADR. In contrast, the Indian market remains one of the best performers globally · with projected Revenue Per year and revenue growth in the 9%-11% range for FY 2024-25, driven by strong domestic and business travel demand, higher occupancies (70%-72%), and rate increases in premium segments (average of INR 7,700-8,000). Sayaji Hotels is well positioned to capture this momentum in its key markets.

The Indian hotel industry is poised for a landmark year in FY 2024-25, building on the momentum of a stellar FY 2023-24. With domestic demand acting as the primary growth engine, the sector is achieved double-digit revenue growth of 13-14% in FY 2024-25, moderating to 11-12% in FY 2025-26, according to industry estimates. This performance is underpinned by a confluence of structural and cyclical drivers.

Robust Domestic Demand: Domestic leisure travel, fueled by a growing middle class with rising disposable incomes, continues to drive demand. Weddings, social events, and spiritual tourism are key contributors, with destinations like Goa, Jaipur, Udaipur, and emerging Tier- II cities witnessing unprecedented footfalls. The Meetings, Incentives, Conferences, and Exhibitions (MICE) segment is gaining traction, supported by government initiatives like "MEET IN INDIA" and the opening of new convention centers in cities such as Mumbai, Delhi, and Jaipur.

Infrastructure and Connectivity: Indias aviation sector, now the third-largest globally, recorded 154 million domestic passengers in FY 2023-24, with a projected 7-10% growth in FY 2024-25. The addition of over 1,600 aircraft to Indian carriers order books and new airports will enhance connectivity to Tier-II and Tier-III cities, unlocking further hotel demand. Highway development and regional tourism circuits under schemes like SWADESH DARSHAN and PRASHAD are also key enablers.

Economic and Policy Support: Indias GDP is expected to grow at 6.5-6.8% in FY 2024-25, as per Deloitte Insights, supported by strong domestic consumption and government spending.

The hospitality sector benefits from 100% FDI allowance under the automatic route and tax incentives for hotels in heritage and rural areas, fostering investment. However, inflationary pressures and potential disruptions from the national elections in Q1 FY 2024-25 could temper short-term demand.

*Source: Hospitality Market Report 2025 published on Researchs and Markets covers Asia-Pacific; Western Europe; Eastern Europe; North America; South America; Middle East; A frica,

*Article Dated January 23, 2025 published on EHL Insights on Key Hospitality Data & Industry Statistics to Watch for 2025

* Article published on Travel World.com from Economic Times dated January, 2024 on Indian hotel industry to report double digit revenue growth in FY 2024: ICRA

World Economic Outlook

According to the International Monetary Funds (IMF) World Economic Outlook Update, global economic growth is expected to rise marginally to 3.3% in 2025. This growth trajectory reflects resilience in major economies, though it is tempered by ongoing geopolitical uncertainties, trade tensions, and inflationary pressures. Services inflation, in particular, remains a key concern, delaying disinflation efforts and complicating monetary policy normalization across regions.

Globally, the hospitality industry is poised to benefit from a rebound in international travel, with the World Travel & Tourism Council (WTTC) estimating the sectors contribution to global GDP at $11.1 trillion in 2024, or approximately 10% of the total. However, challenges such as high borrowing costs, fluctuating consumer confidence, and competition from alternative lodging options like short-term rentals may temper growth in certain markets. In India, the hotel industry is expected to capitalize on rising domestic tourism, fueled by an expanding middle class and improved connectivity, alongside a gradual recovery in inbound international arrivals. This economic backdrop presents both opportunities and challenges for our company. While Indias strong growth supports demand for hospitality services, global uncertainties necessitate a strategic focus on operational efficiency, cost management, and capturing domestic market potential to sustain performance in FY 2024-25.

Source: International Monetary Fund (IMF), World Economic Outlook Update, July 2024, United Nations, World Economic Situation and Prospects 2025, January 2025, Reserve Bank of India (RBI), Monetary Policy Statement, December 2024, World Travel & Tourism Council (WTTC), Economic Impact Report, 2024.

Indian Economy

The Indian economy in the financial year 2024-25 has demonstrated resilience amid global uncertainties, maintaining a robust growth trajectory that continues to bolster the hospitality sector. India remains one of the fastest-growing major economies, with GDP growth projected to range between 6.5% and 6.8% for FY 2024-25, as per Deloitte Insights economic outlook.

This growth is underpinned by strong domestic consumption, a burgeoning services sector, and significant government investment in infrastructure. The services sector, which includes hospitality, grew by 7.2% in FY 2024-25, driven by robust demand in public administration, finance, and real estate, contributing significantly to Indias GDP and employment landscape.

Rising disposable incomes, an expanding middle class, and increased urbanization have fueled domestic travel and leisure spending, key drivers for the hotel industry. The governments focus on infrastructure development, including the addition of 75 new airports over the last decade (bringing the total to 149 by 2024) and a Rs. 1 lakh crore capex plan for airport infrastructure, has enhanced connectivity, making tourist destinations more accessible and boosting demand for hotel accommodations. Additionally, initiatives like Swadesh Darshan 2.0 and PRASHAD, with a budget allocation of Rs. 2,541.06 Crore (US$ 291.07 Million) for tourism in the Union Budget 2025-26, underscore the governments commitment to promoting sustainable tourism, a positive signal for the hospitality sector.

The company remains well-positioned to leverage Indias economic momentum, aligning its strategies with the nations focus on tourism-led growth and infrastructure enhancement, while navigating the evolving macroeconomic landscape with prudence and adaptability.

Source: Deloitte Insights - "India Economic Outlook" (Published January 15, 2025); India Budget - Economic Survey 2024-25 Highlights; IBEF - "Growth of Hotel Industry in India" (Updated July 24, 2024); Hotelivate - "2024 Indian Hospitality Trends Report" (Published October 8, 2024).

Risk Governance

We understand that effectively managing risk is critical to the execution of our strategic objectives. We strike a balance between managing potential risks and seizing emerging opportunities to achieve excellence, both operationally and financially. To fulfil the Groups strategic aims, we are embedding a culture of proactive risk management by supporting acceptable and monitored risk-taking.

The number of risks that our sector is dealing with is on the rise. Hospitality sector faces a variety of potential risks that hotels need to contend with, particularly as they deal with an influx of both leisure and business travelers. Rapidly changing customer demands and a boom in guest-facing connected technologies are among the factors changing the risk landscape for hospitality companies. Following are risk identified and steps taken to mitigate them:

1. Business slowdown, Inadequate growth:

Risk of business slowdown, inadequate growth and negative returns has been increased. Especially our industry has been the most affected one which has turned the growth chart downwards. We have identified four steps:

> next-generation talent models,

> data-driven decision making,

> customer loyalty, and

> operational flexibility and responsiveness to map out the kind of readiness thats likely to help our business even in a coming downturn. Whats left to determine is the path from theory to action which we are working on.

2. Cyber Security - Data Privacy:

Cybersecurity has been a big concern for a number of sectors, but the hospitality business is more focused on preventing data and identify theft. A security breach has huge ramifications. At the very least, businesses are required to contact other guests (past and present) and inform them that their data may have been compromised. This alone can be costly and may also lead to brand damage. If stolen data is used by fraudsters, the businesses may face liability claims for failure to protect data and maintain reasonable safeguards. As more hospitality and travel companies use digital systems to automate tasks and manage their data, we are identifying the potential risks and putting all efforts to bring their solution to the table.

3. Guest behavior:

In hospitality industry, Guests represent the fuel, without guests and travelers, our business wouldnt make any money. However, guests can also potentially be the biggest threats - both directly and indirectly - to profitability. Lawsuits from people who are injured or damage to guestrooms can represent a big risk to the bottom line. We have internal controls in place to handle guest destruction and ensure travelers safety during their stay. Small things, such as closer management of property and resources, helps in preventing incidents like this from happening in the first place.

4. Branding:

As the hotel industry has consolidated, operators brands have expanded into a vast number of territories, and are often instantly recognizable to customers. Therefore, it is of vital importance to operators that the brand is protected in every unit. Hence, we ensure that high and consistent standards are maintained throughout all locations, which is challenging due to the geographical distance separating each establishment. We reduce this risk by establishing strong brand guidelines which are communicated effectively to staff in all Units.

Brand protection may equally involve the need to enforce intellectual property rights. Any infringement by an inferior brand may affect customers perception of our brand. Hence, we ensure that all rights are appropriately registered and regular intellectual property audits are carried out, if standards are not maintained.

Government Initiatives

The Union Budget 2025-26, presented by Finance Minister, underscores the Indian Governments commitment to positioning tourism and hospitality as pivotal drivers of employment-led economic growth. A flagship initiative is the development of 50 key tourist destinations in partnership with state governments under a "challenge mode" framework. This performance-linked approach incentivizes states to improve destination management, including tourist amenities, cleanliness, and marketing efforts, while providing land for infrastructure development.

The Union Budget for FY 2025-26 allocates Rs. 2,541.06 crores (US$ 291.07 million) to the Ministry of Tourism, a notable increase from Rs. 850.36 crore in FY 2024-25 revised estimates, reflecting a renewed focus on infrastructure and sustainable tourism. Under the Swadesh Darshan 2.0 scheme, Rs. 1,900 crores are earmarked for integrated tourism circuits, emphasizing high-value and competitive tourism offerings. Additionally, the Pilgrimage Rejuvenation and Spiritual Heritage Augmentation Drive (PRASHAD) scheme continues to enhance pilgrimage and heritage sites, with a special emphasis on Buddhist circuits to attract Southeast Asian visitors.

To bolster connectivity, the government has expanded the UDAN scheme to include 120 new destinations, alongside a Rs. 1 lakh crore capex plan for airport infrastructure. This builds on the addition of 75 new airports over the past decade, bringing the total to 149 by 2024, and is expected to enhance accessibility to tourist destinations, thereby increasing footfalls at the companys properties. Furthermore, streamlined e-visa facilities and visa fee waivers for select tourist groups aim to boost foreign tourist arrivals (FTAs), which reached 7.6 million between January and October 2024.

Source: Union Budget 2025-26 Speech by Finance; Ministry of Tourism - Budget Allocation Highlights (Published February 2025); Economic Survey 2024-25; Press Information Bureau (PIB) Release - “Union Budget 2025-26 Identifies Tourism as a Sector for Employment-Led Growth" (January 31, 2025).

Internal Control Systems and their Adequacy

The Company has in place a system of internal controls, with documented procedures covering all functions in the hotel operating units. System of Internal Controls are designed to provide reasonable assurance regarding the effectiveness and efficiency of operations, the adequacy of safeguards for assets, the reliability of financial controls, and compliance with applicable laws and regulations. The Company has a systematic process and well- defined roles and responsibilities for people at different hierarchical levels.

Discussion on Financial Performance with respect to Operational Performance

• The Companys Total Revenue stands at Rs. 14,150.81 Lakhs in the FY 2024-25 as compared to Rs. 11,646.28 Lakhs in the FY 2023-24, an increase of about 22%.

• Earnings Before Interest, Depreciation, Taxes, Amortizations and Exceptional Items (EBIDTA) for the FY 2024-25 is Rs. 3885.93 Lakhs as compared to Rs.4187.12 Lakhs for the previous year, a slight decrease of about 7%.

• Profit before Tax for the FY 2024-25 is 1310.83 Lakhs as compared to Rs. 2306.05 Lakhs in the FY 2023-24, a decrease of about 43%.

• The Net Profit after tax for the FY 2024-25 is Rs. 1,021.01 Lakhs as compared to Rs. 1821.41 Lakhs in the 2023-24, a decrease of about 44%.

• Total comprehensive income for the FY 2024-25 is 989.98 Lakhs as against Rs. 1789.84 Lakhs in the FY 2023-24, a decrease of about 45%.

• The Cash and cash equivalent as at 31st March, 2025 was Rs.416.01 Lakhs as against Rs. 269.79 Lakhs in the previous year, an increase of about 54%.

• The Company continuously trying to improve the cash flow by applying the various techniques as lease instead of buying of the property, improving inventory management, improvement in debtors ageing and encouragement to electronic payments etc.

• The Company and the Hotels have taken various initiatives to protect the Health and Safety of Guests and Employees. All precautions based on World Health Organization Guidelines and directions of the Central and State Governments have been implemented and are being strictly adhered to.

• The detailed Financial and Operational Performance present in notes to accounts for the financial year 2024-25 which forms a part of this Annual Report.

Material developments in Human Resources/Industrial Relations front, including number of people employed

The Company believes that its intrinsic strength is its people. Your Company strongly believes that human capital is the greatest asset and key differentiator. The Company has always paid special attention to recruitment and development of all categories of staff. The Company is committed to adhere to the highest standards of ethical, moral and legal conduct of business operations. The Company enjoys harmonious relationship with its employees. The total number of people employed by the Company as at 31st March, 2025 are 740.

Details of Changes in Key Financial Ratio & Return on Net Worth

The key financial ratios of the Company where there has been significant change (25% or more) and change in Return on Net Worth are summarized below along with detailed explanation:

Particulars	Unit	2024-25	2023-24	% of Change	Detailed explanation, if there is any significant change, i.e., 25% or more
Debtors Turnover Ratios	Times	16.04	12.96	24%
Inventory Turnover Ratio	Times	30.53	24.68	24%
Interest Coverage Ratio	Times	2.29	3.43	-33%	Increase in interest cost and depreciation in F.Y. 2024-25 compared to F.Y. 2023-24 has resulted in an decrease in ratio.
Current Ratios	Times	0.80	1.85	-57%	Increase in Debt in F.Y. 2024-25 compared to F.Y. 2023-24 has resulted in an decrease in ratio.
Debt Equity Ratios	%	57	0.83	67.67%	Increase in Debt in F.Y. 2024-25 compared to F.Y. 2023-24 has resulted in an increase in ratio.
Operating Profit Margin	%	28.10	37.46	-25%	-
Net Profit Margin	%	7.22	16.30	-56%	Increase in interest cost and depreciation in F.Y. 2024-25 compared to F.Y. 2023-24 has resulted in an decrease in ratio.
Return on Net Worth	%	18.00	39.00	-54%	Increase in interest cost and depreciation in F.Y. 2024-25 compared to F.Y. 2023-24 has resulted in an decrease in ratio.