Detailed Narrative
Q4 FY25 and Full Year FY25 Financial Performance
EIH Limited reported its highest-ever financial performance for FY25, with consolidated revenue growing by 11% year-over-year and EBITDA increasing by 13%. Standalone revenue also saw a 9% growth, with EBITDA up 10%. Notably, standalone PAT surged by 44% year-over-year, significantly boosted by a ₹115 crore exceptional gain📎 from the deconsolidation of Mashobra. However, consolidated PAT growth was limited to 6% due to specific exceptional item📎s related to Oberoi Grand and Tirupati.
Operational Excellence and Market Leadership
The company maintained its leadership position in the Indian hotel sector, outperforming competitors in key metrics like MPI, ARI, and RGI. In Q4 FY25, the industry saw healthy occupancy rates of 68-70% and an 11-13% increase in Average Room Rates (ARR) compared to FY24, leading to a 14-16% RevPAR growth. EIH's owned and managed hotels achieved a 22% RevPAR growth in Q4, with Oberoi hotels growing by 24% and Trident by 22%, contributing to an overall 13% RevPAR increase for FY25.
Strategic Growth and Expansion Pipeline
EIH Limited is pursuing an aggressive growth strategy, planning to add approximately 21 new hotels and 1,400-1,500 keys over the next 2-3 years. This pipeline includes 12 domestic and 9 international properties. Management emphasized its focus on driving higher rates, particularly for the Oberoi brand, citing strong demand and the perceived underpricing of quality hotels in India. This expansion is supported by a robust cash surplus of ₹1,000 crores as of March 31, 2025.
Capital Expenditure and Project Updates
Capital expenditure for the year amounted to ₹480 crores on a consolidated basis and ₹270 crores standalone. Key investments included the Oberoi London project, the upcoming Rajgarh property, and significant renovations at Trident Nariman Point, which now includes four floors for long-stay apartments. Additionally, funds were allocated to Oberoi Goa and Oberoi Grand. The Oberoi Grand renovation is on track, with a partial reopening anticipated in approximately 12 months as part of a two-phased approach.
Impact of Business Transitions and Litigation
The company's lounge business concluded as of March 31, 2025, resulting in a revenue loss of ₹122 crores from the previous year, with no plans for renewal. Management aims to offset this loss through increased business in its flight catering segment, which generated roughly ₹490 crores in total OFS business last year. The Wildflower Hall (Mashobra) property remains under litigation, with EIH expressing keen interest in bidding for its continued management, and the recovery of its ₹141 crore book value dependent on court proceedings.
International Business Performance and Outlook
The international business segment contributed ₹131 crores in revenue and ₹36 crores in EBITDA for FY25, marking a 10% growth in revenue. While Middle East operations had faced impacts from regional conflicts, they are now stable. The company is optimistic about its international performance, expecting foreign business to return to or exceed pre-pandemic levels this financial year, driven by strong demand observed in locations like Marrakesh and Mauritius.