Indian Hotels announces route map for profitable growth

The Indian Hotels Company (IHCL) aims to build a portfolio of 300 hotels, clock 33% EBITDA margin with 35% EBITDA share contribution from new businesses and management fees by FY 2025-26.

IHCL, India's largest hospitality company, on Monday (23 May 2022) announced Ahvaan 2025. Under the plan, it will re-engineer its margins, re-imagine its brandscape and re-structure its portfolio.

Ahvaan 2025 maps IHCL's three-pronged strategy to grow profitably in the coming years. IHCL continues to re-engineer its margins with an emphasis on sustained revenue growth, cost optimisation and operational excellence. It will further strengthen the balance sheet with focus on free cash flows and be a zero net debt company.

Scaling its re-imagined brandscape, Ginger will be an important growth vehicle and will scale to 125 hotels, 'amStays & Trails', a branded offering in the homestay market will be a portfolio of 500 and Qmin, IHCL's culinary and home delivery platform will expand to 25 plus cities.

The company also aims at re-structuring its portfolio and achieve a 50:50 mix between its owned/leased and managed hotels. It will look to stimulate growth by unlocking capital through strategic partnerships, monetization and simplification. Having signed the highest number of new hotels in India over two consecutive years 2020 and 2021, IHCL has a strong pipeline of 60 hotels. IHCL is present in 100 destinations across India. Taj, the iconic luxury brand is slated to grow to 100 hotels across the globe, while Vivanta and SeleQtions will scale to a portfolio of 75 hotels.

Puneet Chhatwal, managing director and chief executive officer, IHCL said: "Continuing its growth momentum, IHCL signed over 100 hotels and opened over 40 hotels in the past five years, making it the fastest growing hospitality company in India. Ahvaan 2025 will further accelerate IHCL's profitable growth by scaling its diversified brand portfolio across its traditional and new businesses. Its iconic and strongest brand Taj, Paathya an industry leading ESG+ framework and a strong focus on digital will be the key enablers on this journey."

IHCL and its subsidiaries bring together a group of hospitality brands and businesses, which include Taj, SeleQtions, Vivanta, and Ginger. IHCL has a portfolio of 221 hotels including 53 under development globally across 4 continents, 12 countries and in over 100 locations.

IHCL reported a consolidated net profit of Rs 57.93 crore in Q4 FY22 as against net loss of Rs 116.55 crore in Q4 FY21. Consolidated net sales surged 41.8% to Rs 872.08 crore in Q4 March 2022 over Q4 March 2021.

Shares of IHCL rose 3.63% to settle at Rs 231.15 on the BSE.

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