EIH

EIH reported its best Q2 performance in 15 years, with consolidated revenue growing 13% YoY to ₹623 crore. Profitability saw even sharper gains, with PAT increasing 41% to ₹133 crore and EBITDA margins expanding significantly. Management attributed this to strong domestic demand and a 15% YoY growth in RevPAR for owned hotels, which continues to trade at a 30% premium to its competitive set.

The company unveiled a robust pipeline of 20 new properties expected to be operational by 2029, including 13 Oberoi and 4 Trident hotels. This is part of a broader vision to reach 50 hotels by 2030. Management emphasized that 11 of these projects are in India and 9 are international, with a mix of 9 owned and 11 managed properties to balance capital intensity.

Management is increasingly favoring mixed-use developments, such as the upcoming projects in Hebbal (Bangalore) and Pune, to maximize IRRs. The Hebbal project will feature an Oberoi (125 keys), a Trident (250 keys), and over 1 million square feet of Grade A commercial space. CEO Vikram Oberoi noted that standalone hotels in Tier 1 cities often yield lower returns due to high land costs, whereas commercial leasing significantly enhances the project's internal rate of return.

EIH is investing in a 21-key luxury hotel in Mayfair, London, with a total project cost of £69 million. While the key count is small, the strategic intent is to establish a brand presence in a top-3 source market to facilitate future management contracts in Europe and the US. EIH expects its net equity exposure to be under £18 million after bringing in a 49% partner and utilizing 50% debt.

Despite the closure of Oberoi Grand for renovation and muted performance in the MENA region due to conflict, EIH demonstrated strong pricing power. ARR grew 9% YoY to ₹14,970, and management expects rates to remain strong through the peak winter season (Q3 and Q4). The Trident brand showed particular strength, with Trident Metro RevPAR growing by 22%.