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    Chalet Hotels Q1 FY27 earnings call

    CHALET
    Consumer Services·30 Jul 2026
    Management Summary

    Chalet Hotels delivered a strong Q1 FY27, with core business revenue and EBITDA growing 10% and 15% respectively, driven by robust domestic and leisure demand. While geopolitical conflicts impacted international business and construction affected MMR properties, the company saw significant margin expansion and progress on its project pipeline. Management expressed confidence in future growth as construction completes and new projects come online.

    Highlights

    5

    • Core business revenue (excluding residential segment) grew 10% year-on-year to INR 514 crores.

    • Core business EBITDA (excluding residential segment) increased 15% year-on-year to INR 240 crores, with EBITDA margins expanding 231 basis points to 46.7%.

    • Hospitality RevPAR increased by 6.5% year-on-year, largely driven by an 8.5% year-on-year growth in average daily rates.

    • The commercial real estate business saw revenue growth of 18% year-on-year to INR 86.5 crores and EBITDA growth of 21% year-on-year to INR 73.5 crores, maintaining an 85% EBITDA margin.

    • The Powai complex's existing commercial office space (0.9 million sq ft) is over 90% occupied and generates an annual EBITDA of close to INR 130 crores.

    Concerns

    3

    • International business, excluding crew, remained flat year-on-year due to the West Asia conflict.

    • Mumbai Metropolitan Region (MMR) RevPAR was pulled down by Powai and Vashi due to ongoing construction and renovation activities.

    • Bangalore saw lower occupancy year-on-year, partly due to lower group bookings and reduced relocation business.

    Key financials

    Single quarter

    04 metrics
    1. 01Core Business Revenue₹514 Cr+10%YoY
    2. 02Core Business EBITDA₹240 Cr+15%YoY
    3. 03Core Business EBITDA Margin46.7%
    4. 04Net Profit₹86.1 Cr

    Segment breakdown

    • Hospitality₹418.5 Cr81.7%
    • Commercial Real Estate₹86.5 Cr16.9%
    • Residential (Koramangala)₹7.3 Cr1.4%
    Donut· Share of Revenue

    Capital allocation

    3
    high confidence
    CategoryHeadline
    Capex

    ₹30 billion

    largely funded through internal accruals

    Debt

    Net ₹2,040.5 crores

    Cost 7.4%

    Liquidity

    Liquidity disclosed

    comfortable liquidity position around INR4 billion as of June '26.

    Guidance & targets

    11
    CategoryTargetPriority
    Commercial Real Estate
    Monthly Rental Exit Run Rate
    INR 30-32 crores
    		High
    Commercial Real Estate
    CIGNUS II Powai Growth Impact
    step-change in growth
    		High
    Project Completion
    CIGNUS II Powai Substantial Completion
    FY27 end
    		High
    Project Launch
    Taj project Delhi International Airport Rooms Launch (Minimum)
    70 rooms
    		High
    Residential Project
    Koramangala Phase 2 Units Handover
    168 units
    		High
    Commercial Project
    Koramangala Commercial Space Lease
    leased
    		High
    Hospitality Portfolio
    Total Keys
    north of 5,000 keys
    		Medium
    Hospitality Portfolio
    New Inventory Addition
    500 or more keys
    		High
    Leisure Portfolio
    Share of Total Portfolio
    20%
    		High
    Resort Occupancy
    Stabilized Occupancy
    60-65%
    		Medium
    Project Start
    South Goa Project Construction Start
    start construction
    		Medium

    What to watch in Q2 FY27

    5

    Powai & Vashi Occupancy/RevPAR Recovery

    Next quarter (Vashi/FPS), 1-1.5 quarters (Powai noisy work completion)
    CurrentUnderperforming due to construction/renovation
    TargetSignificant improvement, 'roaring back'

    Why it matters

    These properties represent 60% of MMR inventory and are key to overall performance recovery.

    As we speak, the porch work will come to an end by the end of this quarter, so second half of the year, we are very confident that we'll be picking up business in the social segment... Powai should come back and roaring back, even though it has underperformed in the last few quarters.

    Risks & concerns

    3
    RiskSeverity

    Geopolitical Situation Impact on International Business

    West Asia conflict caused international business (ex-crew) to remain flat YoY, and the situation is volatile, making forecasting difficult. — Management acknowledged

    medium

    Construction and Renovation Impact on MMR Properties

    Ongoing construction at Powai and renovation at Vashi (60% of MMR inventory) temporarily pulled down RevPAR and occupancy in the region. — Management acknowledged

    medium

    Market Education for Premium Pricing in New Segments

    Athiva Khandala is creating a new MICE market at a premium price level, which requires time and marketing efforts to educate the market. — Management acknowledged

    low

    Q&A highlights

    7

    “As we speak, the porch work will come to an end by the end of this quarter, so second half of the year, we are very confident that we'll be picking up business in the social segment... Powai should come back and roaring back, even though it has underperformed in the last few quarters.”

    Analyst questioned the relative RevPAR underperformance in MMR. Management explained it was due to ongoing construction at Powai and renovation at Vashi, which are 60% of their MMR inventory, but expressed confidence that these properties would recover significantly once work is completed, with Powai's porch work ending this quarter and noisy work in 1-1.5 quarters. This matters as MMR is a significant market for Chalet.

    asked by Karan Khanna

    3 min read7 chapters

    Detailed Narrative

    01

    Q1 FY27 Performance Overview

    Chalet Hotels reported a strong Q1 FY27, with core business revenue (excluding residential) growing 10% year-on-year to INR 514 crores. Core business EBITDA increased 15% year-on-year to INR 240 crores, leading to a significant EBITDA margin expansion of 231 basis points to 46.7%. The net profit for the quarter stood at INR 86.1 crores, reflecting robust performance despite challenging geopolitical situations.

    02

    Hospitality Segment Dynamics

    The hospitality segment delivered a 9% year-on-year revenue growth to INR 418.5 crores and an 11% increase in EBITDA to INR 178.4 crores, with margins improving by 92 basis points to 42.6%. RevPAR increased by 6.5% year-on-year, primarily driven by an 8.5% growth in average daily rates. The leisure portfolio showed strong performance with 19% RevPAR growth, and Athiva Khandala's ADRs are sustaining north of INR 15,000 on weekends.

    03

    Commercial Real Estate Growth

    The commercial real estate business continued its strong trajectory, with revenue growing 18% year-on-year to INR 86.5 crores and EBITDA up 21% year-on-year to INR 73.5 crores, maintaining an impressive 85% EBITDA margin. The overall occupancy for the commercial portfolio reached 91%, and the monthly rental exit run rate for June '26 was INR 29 crores. Management expects monthly rentals to scale up to INR 30-32 crores during FY2027.

    04

    Mumbai MMR Performance & Construction Impact

    The Mumbai Metropolitan Region (MMR) RevPAR was temporarily impacted by ongoing construction at Powai and renovation at Vashi, which together constitute over 60% of the company's MMR inventory. While JW Sahar continued to outperform, Powai and Vashi experienced temporary occupancy dips. Management anticipates a strong recovery for these assets as construction completes, with Vashi rebranding in the coming weeks and Powai's noisy work expected to conclude within 1-1.5 quarters.

    05

    Project Pipeline & Expansion Plans

    Chalet Hotels has a robust expansion pipeline, including the CIGNUS II commercial project at Powai, which is on track for substantial completion by FY27 end. The Taj project at Delhi International Airport is set to launch a minimum of 70 rooms in Q4 FY27. The company is also evaluating expansion potential at its Udaipur resort and plans to add 500 or more keys annually to its hospitality portfolio, which is targeted to exceed 5,000 keys.

    06

    Capital Structure & Liquidity

    The company reported a net debt of INR 2,040.5 crores as of June '26, with INR 1,091.4 crores allocated to assets under construction. The average cost of finance marginally declined to 7.4% as of June '26 from 7.5% in March '26. Chalet maintains a comfortable liquidity position of approximately INR 400 crores, which is expected to largely fund its planned capex of INR 3,000 crores over FY27-FY29 through internal accruals.

    07

    Domestic Demand Resilience & Outlook

    Management highlighted the sustained strength of the Indian consumer and domestic travel market, which continues to drive demand despite geopolitical headwinds🌐 impacting international arrivals. They believe the potential of the Indian domestic market is 'still not fully realized' and expressed strong confidence in its long-term growth, citing rising affluence and changing consumer preferences. The company is not concerned about any waning in domestic market consumption.

    This is an AI-generated summary of a publicly available earnings call transcript.