Business Today
Loading...
India Hotels in aggressive expansion despite COVID-19 hit

IHCL follows an asset-light growth strategy and targets to expand through management contracts of about 80 per cent. It opened seven hotels in FY21 by adding over 700 rooms to its operational inventory

India Hotels in aggressive expansion despite COVID-19 hit

The Indian Hotels Company (IHCL), which owns Taj group of hotels, is looking for a comprehensive turnaround when the COVID-19 impact tapers off. It has recorded highest number of new hotel signings and openings in the industry during FY 2020-21 - with 17 signings and seven new hotel openings.

The company follows an asset-light growth strategy and targets to expand through management contracts of about 80 per cent. It opened seven hotels in the last financial year by adding over 700 rooms to its operational inventory including The Connaught in Delhi.

ALSO READ: No, not bankruptcy! Oyo insolvency admitted by NCLT for Rs 16 lakh dispute

The company has reported positive earnings before interest, taxes, depreciation and amortisation (EBITDA) of Rs 83 crore in the fourth quarter of FY21 - a 118 per cent rise from Q3b FY21. The pandemic has severly dented the company's annual numbers and it has reported a net loss of Rs 720 crore in financial year 2020-21 compared to Rs 354 crore in the previous financial year. In the January-March quarter, the loss was at Rs 91 crore as against a profit of Rs 74 crore.

IHCL's revenue dipped 62 per cent to Rs 1,740 crore in 2020-21. IHCL shares were slightly up and closed at Rs 111.45 on BSE on Friday, when the Sensex crashed by almost 2 per cent.

Puneet Chhatwal, CEO and MD, IHCL said, "Despite continued pandemic-related challenges that have impacted the travel and hospitality sector, IHCL has remained laser-focused on executing its RESET strategy. The company has developed innovative revenue streams to meet evolving customer needs and have followed stringent spend optimisation and financial prudence measures."

ALSO READ: New COVID-19 wave hits hospitality sector; Mumbai, Bengaluru hotels worst sufferers

Giridhar Sanjeevi, Executive Vice President and Chief Financial Officer, IHCL, said, "Our relentless focus on performance, management of operational costs and continuing efforts to strengthen liquidity has helped IHCL survive through this extremely challenging phase, and we will continue our multiple efforts to continue to grow and be profitable."

Taj Hotels has offered over 1,400 rooms as quarantine facilities to its partner hospitals. During the pandemic, IHCL's culinary home delivery platform under Qmin brand has been expanded to 14 locations across India.

Get latest news & live updates on the go on your phone with our News App. Download The Business Today news app on your device
More from BIZ WRAP