Indian Hotels Co

Indian Hotels Co delivered its 13th consecutive quarter of record performance in Q1 FY26, with consolidated revenue growing 32% YoY to INR2,102 crores and EBITDA increasing 29% YoY to INR637 crores, achieving a 30.3% margin. This was achieved despite significant industry headwinds^🌐, including geopolitical tensions, airspace closures, and hotel cancellations. The company's strong brand equity and diversified portfolio enabled it to outperform the industry, with hotel segment revenue and EBITDA growing 14% and 15% respectively, and standalone revenue up 13% to INR1,099 crores.

Taj was recognized for the fifth time as India's strongest brand across all sectors and for the fourth time as the world's strongest hotel brand by Brand Finance. The company continued its aggressive portfolio expansion, signing 12 new hotels and opening 6 in Q1 FY26, bringing its total portfolio close to 400-plus hotels. IHCL is on track to achieve its Accelerate 2030 target of 700 hotels and expects to open over 30 new hotels this fiscal year, with momentum accelerating from September.

IHCL's new businesses vertical, comprising Ginger, Qmin, amã Stays & Trails, and Tree of Life, demonstrated robust growth of 27% YoY. Management fees, driven by a capital-light strategy, increased 17% from INR114 crores to INR133 crores, contributing positively to EBITDA. The company's loyalty program, Tata Neu, has seen significant traction, with membership exceeding 11 million and app revenue growing 46% YoY, underscoring the success of its digital initiatives.

The company maintains a strong balance sheet with gross cash reserves exceeding INR3,050 crores, enabling planned investments of INR1,200 crores in FY26 for assets under construction, renovations, expansions, and digital initiatives. IHCL is exploring inorganic opportunities, including a new asset platform with Tata Group for Ginger brand expansion, such as the Kolkata Airport hotel. International hotels performed strongly, with US hotels seeing an 18% RevPAR growth, driven by investments in London and recovery in San Francisco.

Management acknowledged Q1 headwinds but expressed confidence in achieving double-digit revenue growth for the full year, supported by MICE activity and diplomatic visits. The company is also targeting 20% top-line growth in its airline catering business. IHCL noted that new hotel supply is primarily directed towards Tier 2/3 cities and new markets, mitigating competitive pressure on average room rates (ARR) in key metros. The company is also addressing talent shortages through its Paathya initiative, having skilled over 31,000 youth towards a goal of 100,000 by 2030.