Indian Hotels Company Ltd. Q4FY26 Results Analysis

Management Commentary:

• Its management expressed confidence in delivering 12–14% revenue growth for FY27, supported by sustained domestic demand, new hotel openings, and stabilization of recently launched properties and acquired businesses.
• Industry fundamentals remain favorable, with limited incremental supply across key Indian markets. This supply-side constraint is enabling the company to maintain pricing power and sustain healthy occupancy levels in the 80–90% range.
• Ongoing investments in digital infrastructure and the Tajness loyalty ecosystem are strengthening customer engagement, resulting in a 2 percentage point improvement in direct website booking mix.
• The company also aims for the Ginger brand to scale up to 250 hotels (operational and pipeline) by FY27.
• During FY26, IHCL deployed approximately ₹500 crore across four strategic acquisitions, including Tree of Life and ANK Pride, which are expected to contribute around ₹250 crore in incremental revenue.
• During FY26, IHCL deployed approximately ₹500 crore across four strategic acquisitions, including Tree of Life and ANK Pride, which are expected to contribute around ₹250 crore in incremental revenue.
• The company continues to maintain a strong pipeline of over 31,000 keys and expects more than 60 hotel openings in FY27, further strengthening its leadership in the Indian hospitality sector.
• Q4FY26 performance was temporarily impacted by global disruptions, particularly the West Asia conflict, which affected inbound travel and led to airline route suspensions. Dubai hotel occupancy declined to around 25%, impacting fee income, while last-minute MICE cancellations also weighed on performance.
• IHCL has guided FY27 capex of ₹1,100–1,300 crore as part of its broader ₹5,000 crore long-term investment plan, aimed at supporting over 60 hotel openings, 750+ owned/leased keys, and renovation of iconic properties such as Taj Palace and The Taj Mahal Palace. The entire capex will be funded through internal accruals, while maintaining a strong liquidity position of over ₹4,300 crore

Outlook

Indian Hotels has delivered a strong operational and financial performance in Q4FY26 with revenue growth of 14% YoY and PAT growth of 14.7% YoY over Q4FY25. For FY26, revenue grew 16.3% and net profit grew 10.3% from last financial year, driven by strong growth momentum across segments and sustained demand strength. Domestic operations continued to be the key driver, contributing nearly 80% of total revenue, while the Taj brand remained the largest contributor at around 68.9%. It also comfortably surpassed its guided revenue growth for FY26.

Segment performance remained healthy, with Hotel Services revenue growing 11.3% YoY and Air & Institutional Catering rising sharply by 68.9% YoY in FY26. Operational metrics also remained strong, with RevPAR increasing 9.3% YoY to ₹11,750, led by the Taj brand at ₹18,600, reflecting premium positioning and pricing strength.

On the expansion front, IHCL continued aggressive portfolio growth. The brand portfolio expanded to 14 brands, supported by a record 250 hotel signings and a pipeline of 255 hotels. During FY26, the company opened or on boarded over 130 hotels, taking total operational hotels to 375 with more than 33,000 rooms.

Management remains confident of sustaining 12–14% revenue growth in FY27, supported by strong domestic demand, new hotel openings, and ramp-up of recently launched assets. The pipeline remains strong with over 31,000 keys and expected 60+ hotel openings in FY27, reinforcing leadership in the Indian hospitality sector.

Capex guidance for FY27 stands at ₹1,100–1,300 crore, part of a broader ₹5,000 crore long-term investment plan focused on expansion, renovations of iconic properties, and capability building.

Financially, the company reported EPS of ₹14.64 in FY26. At a CMP of ₹629, the stock trades at 42.96x P/E. Considering strong visibility on growth, robust domestic demand, expansion pipeline, and management confidence, the valuation appears reasonable, with potential for steady medium- to long-term performance.

Results:

Particulars (₹ Cr)	Q4FY26	Q3FY26	Q4FY25	QoQ%	YoY %	FY26	FY25	YoY%
Revenue from operations	2,765.3	2,842.0	2,425.1	-2.7	14.0	9,689.2	8,334.5	16.3
Food and Beverages Consumed	257.6	276.9	234.9	-7.0	9.7	950.9	773.8	22.9
Employee Benefit Expenses	656.5	641.5	588.2	2.3	11.6	2,486.7	2,150.7	15.6
Other expenses	878.5	847.7	745.2	3.6	17.9	3,057.0	2,640.8	15.8
Total Expenses	1,792.6	1,766.1	1,568.4	1.5	14.3	6,494.6	5,565.2	16.7
EBITDA	972.7	1,075.8	856.8	-9.6	13.5	3,194.7	2,769.3	15.4
Margin (%)	35.2	37.9	35.3	-7.1	-0.4	33.0	33.2	-0.8
Depreciation and amortisation expense	167.4	150.3	142.0	11.3	17.9	605.2	518.2	16.8
EBIT	805.3	925.5	714.8	-13.0	12.7	2,589.5	2,251.2	15.0
Exceptional items	0.0	275.5	-2.6	-100.0	-100.0	275.5	304.8	-9.6
Other income	79.5	58.3	61.6	36.4	29.0	282.2	230.5	22.5
Finance costs	54.9	55.8	53.9	-1.6	1.9	221.4	208.4	6.2
Share of Profit/(Loss} of Associates and Joint Ventures (net of tax)	20.2	19.9	22.7	1.5	-10.8	52.1	76.8	-32.2
EBT	850.1	1,223.4	742.6	-30.5	14.5	2,978.0	2,654.9	12.2
Tax	204.7	269.1	180.0	-24.0	13.7	730.7	616.8	18.5
PAT	645.4	954.2	562.7	-32.4	14.7	2,247.3	2,038.1	10.3
EPS	4.2	6.4	3.7			14.6	13.4

Source: Company website, EWL Research

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