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Chalet Hotels hopeful of robust growth after strong Q3
The strong showing of hotel chains in the quarter ended December has put to rest concerns about slowing growth in the hospitality sector after the second quarter, Shwetank Singh, managing director and CEO of Chalet Hotels, told ET in an exclusive interview.
"Q3 was a very good quarter for us, and the outlook for the sector looks very positive going ahead," said Singh who took the top post effective February 1. "Better airport connectivity, and road infrastructure have led Indians to take multiple holidays instead of one yearly holiday. Travel is not being seen as discretionary spending and is becoming a way of life for many," he added.
Chalet Hotels, owner, developer and asset manager of high-end hotels, reported a net profit of ₹124 crore for the third quarter, up 28.5% year on year. The chain reported revenue from operations of ₹581.6 crore, up 27.1%.
Singh said the company has 'major' announcements in the pipeline. In December, it announced a proposed acquisition of a company owning a 150 rooms resort property in Udaipur for ₹171 crore. It is also constructing the Taj Hotel at Delhi airport.
"We have been in an expansion mode, and these announcements will put us on a very robust growth path. A lot of these announcements will materialise through our Mindspace business," Singh said.
Both Chalet Hotels and Mindspace Business Parks are part of K Raheja Group.
"We are already in possession of these land parcels backed by a large commercial arm," Singh said. "The acquisition risk on them is zero. Because the two asset classes go so beautifully together, for us to follow Mindspace would be a natural progression. They find it helpful because having a great hotel in a business park helps drive numbers."
The firm's Ebitda increased 29% to ₹272.6 crore in the third quarter from ₹211.3 crore a year earlier.
Chalet Hotels said construction is progressing for the Taj hotel at Delhi airport and the chain expects completion by the fourth quarter of FY27.
Singh said its acquisition spree will not stop. "We have been a Maharashtra-centric company so far. For us to deviate to greenfield projects in far-flung areas becomes extremely hard. But we love acquiring assets in areas where we can't build, and we are looking at multiple opportunities," he said.
The hospitality firm has also announced the launch of Athiva Hotels & Resorts, a new premium lifestyle hospitality brand debuting with over 900 keys across six hotels in October.
"We were earlier just asset owners and during that time, we quietly developed asset management practices. With these capabilities, we got reasonably confident that we could do this at scale, and the next logical step was launching a brand," Singh said.
"Currently, we are putting the brand on our properties to prove to ourselves that we can do it consistently and keep the customers at the heart of our decision making," he added.
Source: The Economic Times