Indian Hotels margins have room for expansion with better cost optimisation

Cut in GST rate to 18% from 28% will help sector, says company

Led by an improvement in key parametres, Indian Hotels registered a better-than-estimated performance in the September quarter. 

Receipts were led by higher revenue per available room or RevPar (combination of occupancy and room rates) which rose 4 per cent.

Occupancies jumped 4 percentage points over the year-ago quarter to 68 per cent. Its performance in key markets of Mumbai, New Delhi, Chennai, and Hyderabad, among others, helped it outperform the sector and gain market share. 

The company indicated that RevPar trends over the past month have been positive, led by growth in occupancies. 

The management believes the cut in goods and services tax (GST)