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EIH Ltd
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Good afternoon, ladies and gentlemen, and thank you for attending this virtual meeting. It's my pleasure to welcome you on behalf of EIH Limited and SKP Securities to EIH Limited's Q4 FY '24 and FY '24 earnings webinar.
We have with us Mr. Vikram Oberoi, Managing Director and Chief Executive Officer; and Mr. Kallol Kundu, Chief Financial Officer. This meeting is being recorded for compliance reasons. And during the course of discussion, there may be certain forward-looking statements. These must be viewed in conjunction with the risks that the company faces.
We'll have the opening remarks by Mr. Oberoi, followed by a presentation and we'll thereafter open the floor for the Q&A session. Thank you, and over to you, Vikram.
Actually Navin, we can straightaway just go to Kallol's presentation and then open it up for questions and answers, if that's all right?
Yes, yes, absolutely.
Thank you. Navin, would you mind...
Yes, I'll just do.
Good afternoon, ladies and gentlemen. So here we are back with the earnings call for the year -- the quarter of -- the last quarter of FY '24, and the year ended FY '23-'24. Well, one of the things is that we -- the call is being held after a few days after the results were declared, mainly because our top management was traveling just to let all of you know.
To begin with, we start with our HVS Anarock latest report of April '24, which has a strong and positive outlook for the current year. The report feels that the sector is poised for significant expansion and the ongoing growth into domestic tourism as well as corporate travel and MICE travel here to continue.
The key growth was, of course, inbound tourism, wedding markets, MICE tourism, luxury wellness, food and beverage, sustainable tourism and regions and tourism segments, some of which is quite in line with what our ambitions are.
Next slide, please, Navin. As per this report, the recovery in the MICE and the corporate travel segments have significantly contributed to the positive trajectory of major commercial markets, such as Mumbai and New Delhi. And of course, this is one of the major reasons for the bond numbers that our company has demonstrated. Another observation in this report is that while the Indian hotel sector experiences a revival in average rates, which is reminiscent of the booming period of 2007-'08, current figures are still about 5% to 6% below the previous peak. This is, of course, taking the entire industry into account.
The matrices, the key matrices of total revenue per occupied room and RevPAR are as shown in the graph. Of course, as a company, our RevPAR as an organization, our RevPAR is very different from what you're seeing on the screen here for the whole market, but we'll come to that in just a while.
Next slide. Moving on. EIH maintains its consistent RevPAR leadership with a RevPAR index of 127% over the STR composite. And as you can see in the graph, which is really drawn on from April 2019 to March 2024, except one single month of June '20 when the RGI was below the market threshold 100 in all other months in the last 5 years is much higher than our competition set.
And this has been primarily led by rate growth as is evident again in the ARI, which is substantially higher than 100%, as you can see. Moving on, and so far as our domestic hotels are concerned, just a snapshot of how our various segments have been performing vis-a-vis last year in the quarter 4 of FY '23-'24. Overall leisure, as you can see, has substantially gone up in both occupancy and average room rate crossing the 70% occupancy threshold as well as almost touching 50,000 average room rate on an overall basis for all the leisure properties of the Oberoi brand taken together.
The Oberoi Metro properties also is higher than the current year. The RevPAR is higher by about 11% with again substantially higher occupancies of -- in excess of 80% and average room rates of around INR 22,000, but some of the properties doing as much as high as close to INR 30,000. Equally, the Trident Metro hotels have done substantially better again in terms of occupancy, especially, but somewhat in terms of ARR as well, whether the metro hotels in the Trident brand have grown by about 8% vis-a-vis last year.
The same applies for our Trident Leisure hotels, which has gone up by 12% vis-a-vis last year's same quarter and the other brands basically Maidens, which has gone up by about 20%. This is, again, a trend for our international locations. Please pardon us for not being able to give the numbers because these are single hotel companies -- sorry, single hotel destinations. But generally to -- for everybody to understand the trend. In Morocco, there is an increase of buoyancy in occupancy. The rates are somewhat soft. Some of it affected due to the ongoing effect of the Middle East war.
Of course, in the middle -- due to the Middle East war, Egypt operations have been affected, both in terms of occupancy as well as in ARR. But the one point to note in case of Egypt is as an organization, our room revenues in U.S. dollars. And therefore, given the steep depreciation of the Egyptian pound in terms of overall numbers, really, it's not dented our numbers much.
But in terms of occupancy and ARR, of course, there's been a softening. Mauritius has been doing better than last year, both in terms of occupancy and in average room rate. UAE market has softened a little in terms of the average room rate, but there's a major increase in occupancies, same with Indonesia. It's almost similar as last year, but occupancies has really grown by a large margin.
Moving on. In quarter 4, if we were to take all owned hotels of EIH as well as all domestic hotels, both cases, the RevPAR grew approximately by 11% and 15%, respectively. So in case of EIH-owned hotels, while the RevPAR for this has been at close to INR 17,000. And if we were to take all the domestic hotels, including managed hotels, this was at INR 16,392.
Moving on. The last 3 months, the way -- of course, February has always been the strongest month, but the good thing is that in this March Q4 of FY '24, the occupancies have been much higher with a slightly higher average room rate as well, effectively resulting in an increase in the RevPAR, if you were to take all domestic hotels, including managed hotels.
The RevPAR growth city by city, of course, this mentions as all domestic hotels, including managed. This is barring the bar, which you can see in respect of international. So almost all cities have grown. Of course, the variances are quite different from one city to the other. Of course, the leisure locations of Agra, Jaipur and Udaipur were actually better. Mumbai, Delhi and Chennai also continue to grow, but at a slightly lower pace than the leisure destinations, except Hyderabad, which is, of course, grown by 36%.
The 5% growth that we see for the locations where we are present in overseas locations, that's primarily due to the effect that I earlier mentioned about the hotels in the MENA region or the Egypt region, which has been affected by the Israel, Palestine war. And of course, Shimla, Chandigarh slightly affected as far as last quarter -- I mean, last year, the same quarter is concerned.
Across segments, we see strong tailwinds led by direct followed by leisure, which has overtaken corporate at the moment. And of course, then thereafter, it's corporate and MICE. We are very happy to share the strong bounce back in the flight catering and airport lounge for quarter 4 again, which really yielded revenues of INR 115 crores with margins, including the airport lounge business, which is, of course, very profitable, of about 38% and total EBITDA contribution in this quarter itself by INR 43 crores.
On the overall financials for the quarter, this is, of course, the strongest quarter 4 stand-alone performance since the time that we've been tracking results. And of course, there, you can see the steep increases that have happened, both in terms of revenue as well as in terms of EBITDA and PAT. But while the PAT and revenue has grown from INR 587 crores to INR 692 crores in case of revenue and INR 249 crores to INR 300 crores in case of EBITDA.
The slightly lower increase in PAT from INR 147 crores to INR 159 crores is on [indiscernible] account of exceptional items for which an additional exceptional item of about INR 60 crore has been accounted for in the current quarter, disclosures of which were given in the stock exchange intimation as well as it's available on our website. Again, the strongest financial year stand-alone performance with PAT going up from INR 320 crores to a record INR 521 crores. This is again due to [ interest ] would have been higher had it not been for some of the exceptional items. Strongest quarter for consolidated performance. the PAT rising from INR 92 crores to INR 248 crores.
And of course, in case of consolidated because the adjustments that I mentioned in stand-alone were more on account of a subsidiary, and therefore, part of it gets canceled out when we do the consolidation exercise, and therefore, the performance is clearly reflected in our very strong PAT in so far as the quarter 4 performance is concerned.
The same applies for the financial year, where on a stand-alone -- on a consolidated basis, the organization, the company has its historical best ever EBITDA of more than INR 1,000 crores with profit after tax of INR 678 crores, which is almost double the PAT that was there in last year.
Strong stand-alone funds position, INR 570 crores of cash, which obviously gives the ability to the organization to draw in debt as well going forward for our expansion plans. The same applies for the consolidated funds position, which is coming up in the next slide. With the total cash available in banks is about INR 744 crores, again, with the ability to the -- to all the companies to raise debt as and when required for the purpose of expansion.
The financial statements are what they are. INR 60 crores of exceptional items in quarter 4, with total income of INR 692 crores, EBITDA of INR 300 crores, which is a 20% increase over the same quarter last year and PAT increased by 8%, but this would have been higher, if not for the exceptional items.
So these are graphs which you may like to go through has anyone you wish to. If you can carry on. On a consolidated basis in quarter 4, total exceptional items is only INR 17 crore, and this is because of the adjustments and elimination that happens for consolidation, total revenues in the quarter of INR 781 crores and profit after -- from continuing operations of INR 248 crores, which is a 169% increase over last year.
Yes. So moving on now, just some of the awards and accolades, which the organization and the brands continue to receive. You can have a look in the presentation that has been uploaded in the stock exchanges. The rest of it remains same for now.
And of course, there are 2 hotels that will open in this current financial year, which many of you will have questions about, and we can answer them. The rest are statistical details on the business footprint, number of keys, et cetera. For now, the total number of keys is 4,269 considering India and abroad, but this is obviously likely to go up before the end of this financial year.
Thank you so much.
[Operator Instructions] We take the first question from Nilesh Saha.
Are you able to hear me?
Yes, Nilesh. Please go ahead.
Okay. Okay. Great. See, in your FY '23 Q4 deck, there was a slide, which had the list of the new pipelines of hotels that you would add, right? So yes, in that list FY '25 and '26 put together, had around 334 rooms. And subsequently, over the course of last year, you have added Vizag to that. So that added to this is about 459 rooms.
I think you mentioned right now that 2 hotels will open in FY '25. Can you talk a bit about of this total number of rooms? How many would get added in FY '25 and FY '26 on top of your stand-alone base of rooms, which is -- if my memory serves me right, about 2,000-odd rooms, how many would get added in '25 and '26?
Kallol, do you want to take that? Or do you want me to do it? I'm happy to...
Yes, sure. Go ahead. Please go ahead.
I don't have the presentation. First of all, hello, Nilesh. No. Thanks, Nilesh. Likewise, it's always a pleasure. So I'll just go through -- unfortunately, I don't have the slide that you're referring to with me. But what we -- what I can go through is the hotels. We're opening Rajgarh and Vanyavilas later this year. Rajgarh is 65 keys and Vanyavilas will be 21 keys. They opened this year.
The other projects that we've announced are Tirupati, which is 125 keys. Vizag, which is also a similar number, and, Gandikota, which is a small hotel of about 20 keys. And lastly, we've also announced Goa, which has 90 keys. And we have -- in addition to that, overseas, we're opening 2 boats on the Nile. They're relatively small of 7 keys each they open this year as well. I don't know if I've left anything out.
In Goa, you had 2, right? In Goa, you had 2 an Oberoi and Trident.
No, actually, they're both Oberois. One is in Bogmalo, which is a managed hotel, a small hotel and then we have our site which is in Cavelossim, which is a 90-key hotel.
Okay. So -- and when would these -- so you have called out 2 would add this year, very good. The other 3, which you said 2 in Vizag and Goa, when would they add, when would they sort of start?
So work on Tirupati and Vizag has already started. Goa, we're still in the planning stage. My best estimate will -- is that we'll break ground in certainly in the next 6 to 8 months or let's say, 8 to 12 months to be absolutely safe and then 3 years for construction.
I see. I see. 3 years for construction.
I'm referring to the -- our site of the which is...
Right. Okay. Okay. So obviously, you're saying Goa is at least 3 years away and Tirupati and Vizag would probably be also like 2 years away, something like that.
Let's say, 2.5 years away.
2.5 years. Got it. And then -- and yes, you're sort of these other 2, which is the Kathmandu hotel and this other Goa hotel. How would that add to your stand-alone economics like how these Tirupati and Vizag and Tirathgar is adding or no?
So the -- if I just -- the Tirupati hotel is -- and the Gandikota hotel part of Mumtaz Hotels in which EIH has a 60% equity holding. And Vizag is being done by EIH associated.
Okay. Okay. So these are not directly then adding. So then the addition to stand-alone is mainly happening in FY '25? Then there's not much coming to the standalone in FY '26. Is that a right understanding?
That would be a fair statement, yes.
Got it.
Nilesh, just one thing I'm going to add is that new hotels have a certain period for development. And that's -- it's not -- supply can't be in -- or a hotel cannot be built in a short time. So we still are confident in terms of our growth.
But what [indiscernible] Nilesh, is that while you're talking about stand-alone, please remember that entering into contracts with outsiders versus entering into contract with subsidiaries and associates is pretty different because there's a twofold income there. One is in terms of management agreement. And the other one is, of course, as a share of the profits because that could come by way of dividends or whichever way. So therefore it's slightly different from a managed hotel.
Right. So right. No, no. Thanks for that clarification. I just have one slightly sort of strategic question to ask here, right? I know that your balance sheet of the stand-alone entity is healthy, right? We -- you have said in your earlier calls you have a certain aspiration of adding sort of 50-odd hotels, right?
My question to you is that why aren't we adding more of at least the bigger hotels in the stand-alone entity itself? And what happens in EIH associated in Mumtaz is there is, you'll agree, there is some leakage in whichever way we want to call it, because it is not a 100% owned company, right? And if you are making a choice to sort of start a hotel, doesn't the first right of refusal in some way come to the stand-alone? And then my question would be that why isn't the stand-alone taking on the bigger hotels? And with that, I'll come back in the queue.
So Nilesh, just to answer your question in the past, we have -- and I don't want to say too much about it. But if you see in previous annual reports, we've mentioned our site in Bangalore on Hebbal Lake. This is a land owned by EIH, and it's a mixed-use development and a large project. So that's the first thing that I wanted to mention.
The second thing that I wanted to mention to you is that we -- with Mumtaz where EIH has 60% equity. Equally, if that -- with 0 debt, we need to grow that as well. So one shouldn't look at it as one or the other, one should look at it in totality, we need to grow wherever the opportunities arise, and EIH benefits both in terms of management fee and sharing profit with -- or dividends with all these ventures.
I don't know if Kallol wants to add anything further.
I think I just pulled up the presentation that Nilesh was referring to. I think we are absolutely on track. We had mentioned in FY '25 3 hotels, the Oberoi Rajgarh Palace, The Oberoi bandargah and now we're planning with The Oberoi [ Badia ]. And in FY '26 equal, you brought Oberoi Kathmandu the Oberoi Wadi Safar, Saudi Arabia, which is also under planning and the Trident Tirupati. So we are on track, Vikram, in terms of what he had mentioned in his presentation.
Great. Perfect. Thanks for that Kallol. And Kallol, I don't know if you want to comment on the point I made on the...
Vikram, I think, yes, you're absolutely right because I think what is -- it is the consolidated performance that matters at the end of the day because in some other -- when you have to grow, you have to have partnerships, et cetera. And what better can happen than having the partnerships within the framework of the group.
So for us, that is strategically a very important objective.
Nilesh, I hope your.
And just to highlight, just one last point that these companies that I referred to have a strong cash position with 0 debt.
We take the next question from Amit Agarwal.
My question is regarding Wildflower. Sir, is there any chance that we can appeal in the High Court again and go for the higher bench -- bigger bench?
I really think it would be wrong for me to comment on Wildflower Hall at this point. It's subjudice and I would refrain from commenting. I don't know, Kallol, if you want to say anything.
You're right, Vikram. But Amit, I think obviously, as a company, as an organization, we will pursue all the legal remedies that are available to us. And we have adequately disclosed in our latest results, which have been submitted to the stock exchange. If you read through it, I think you'll be clear on the steps that the company is taking to secure its interests.
And how much revenue are we going to lose once it goes out of our scheme of things?
Amit, I can't say really how much revenue we are going to lose because as I said that you'll have to refer to the disclosure. But I can tell you, in general, the company or the company just a GOP of about INR 25 crores with an additional interest income or cash that is lying idle in the company. So that is the balance sheet position of that company. But whether we are going to lose revenue or not, that is obviously subject to the outcomes of what happens in the courts going forward.
Okay. And my second question is regarding hotels in Andhra Pradesh. As we all know that there's a change in regime over there. And as you're all aware, that how the politics works in India, do you think the backing of the political won't be there to -- for the infrastructure we require for the new hotels and new places?
There's -- Amit, there's no reason for us to think to the contrary. Hotel spring employment, visibility to a destination and Oberoi or a Trident Hotel can certainly bring that. So there's no reason for us to have any second thoughts on that.
I think Amit actually to say that given the fact that the current coalition has a strong partner from Andhra Pradesh, one can really expect more to happen for the state than this. So ideally, theoretically, at least, it should work to our advantage.
I've never been to Andhra Pradesh, my worry is the Vizag airport. I don't know how updated it is and how it will span out in the future?
Construction on that has already underway. So work has already started at the airport. So -- and if I'm not mistaken, Kallol, it's been done by GMR, if I'm not mistaken. So that's well underway.
And my last question is regarding Trident, Bombay. In the last conference call, you mentioned that we are going to open 20, 23 residences in Trident. Have they been opened or... sorry?
Yes. It's at the Oberoi Mumbai. And some of them have opened. We've had a slight delay with some of them. The -- and reason for the delay is when you're doing this in a hotel where you have guests, and we're very mindful of guest complaints. There are complaints from time to time during the project stage.
Of course, all of that has come to an end and they're all -- I mean, either finished or nearing completion and also positively received. I don't know if you've seen any press coverage on these, but we've also had certain PR coverage, which shows images and details on these residences or the residential suites, I should say and guest feedback, some of them already occupied and guest feedback on them has been very positive.
So in the last quarter, the revenue has been already added or is it going to reflect in the future quarters?
It will reflect in future quarters. It will reflect in this quarter as well.
We take the next question from Rajiv Bharati.
Sir, with regard to the -- your stand-alone hotels business, now adjusted for your flight services business, the RevPAR is up close to 5%, 5%, 6%. And with that if you see Slide 10, where your Bombay is only 6%. Would you like to throw some outlook on whether this 5%, 6% number? Are you disappointed by it or there is a one-off here, which will get rectified in the...
Sorry. Kallol, can you just clarify the numbers Oberoi.
Mumbai done, if you really see the slide, which shows city wise, Mumbai shows a growth of 6% vis-a-vis the same quarter last year. And sorry, Rajiv, you mentioned another city.
No, Bombay because bulk of our...
Bombay basically 6%, Vikram.
No. But I think what Rajiv also quoted was an increase in RevPAR, and you referred to a 5% increase in RevPAR overall if I understood it correctly, which I don't think is correct.
5% increase in revenue.
In revenue, I see, I thought you said in RevPAR. I have no comment.
So because of the strength of the cycle, you initially mentioned that we are still probably under par as compared to pre-COVID times.
I still believe that's the case, Rajiv. Rajiv, I was just in Hong Kong and comparable hotels, you're paying well over $600 a night. And that's with preferential rates. The averaging rate's even higher than that. So I still believe that with -- as long as there's a positive outlook, and there's no reason for us to be concerned about that and India's long-term growth and prospects look very positive.
I had mentioned earlier on that demand is increasing at about 8% to 10%. And supply over the last 10 years has increased by substantially less than that for luxury and -- luxury and upper upscale hotels. HVS figures are 5.6% between 2013 and 2023 and 7.5% last year.
And so I still remain optimistic. One will have ups and downs quarter-to-quarter, for example, this -- we have the elections. And there's been a softening in the market, which I think would have been experienced by the industry as a whole. But I would encourage you not to look at quarter-to-quarter. Long term, I have no doubt that with India's future being so strong, occupancy and ARR will increase. And our focus always is to drive average room rates up.
So would you like to comment on 6% RevPAR number for Bombay specifically?
I don't need to comment on that, Rajiv.
So Rajiv, this is only for quarter 4 that you're looking at, right? If you look for the whole year, actually, the increase is way more.
Yes. What is it for the whole year?
I see individually I'm looking at it, Trident Nariman Point is at least more than 10%. Trident -- I mean the Oberoi is about 20% and Equally Trident Bandra Kurla is close to about 15%.
And of course, in the last quarter, we didn't have the rooms under renovation. But if you look year-on-year, we had rooms, 4 floors under renovation as well as Trident Nariman Point. So Rajiv, I stick to what I said, average room rates as long as we have the economy doing what it has done, rates will continue to grow and I think rates will grow in the luxury and premium segment at a greater rate than they will in other categories of hotels. So I would still -- I have -- I don't change my view from what I've said previously.
Sure. Sir, on the subsidiary performance, if I do C minus S, you have done some 25% growth on the subsidiary side. Now you -- I think the slide said 5% growth on international on the RevPAR and there was Agra which can explain probably Mumtaz. But still this 25%, can you throw some light where is it coming from, which entity specifically?
It will be coming from only other entity is -- the 2 other entities, which is EIH Associated and Mashobra. And I don't have the figure in front of me. Kallol, maybe you can -- if you can refer to the figures, but EIH associated would be contributing to that, too.
Well, I think Rajiv, talk of subsidiaries, it's Mumtaz, Mashobra and international. And like we mentioned before that overall, the international performance has improved. But it's slightly conservative because of the effects of the conflict. Mumtaz has really done well, as you can see, like I mentioned, in both the cases, both the hotels has obviously collectively gone up by about 41%. Mashobra's performance has also been good. And of course, that also reflects in our total overall revenues and sort of incomes.
Sure. So lastly, in terms of the Mashobra case, so is it right that we have sought close to INR 580 crores across the fair market whether in MR for the case?
Please refer to all the disclosures we made.
It Is clearly laid out in the disclosure.
We take the next question from Sanjay Kohli.
Yes. Am I audible?
Yes, you are.
I just wanted to have a bit better understanding about your flight kit -- flight catering and the airport lounge business seems to be very promising. So can we expect very good growth over the next 3 to 5 years from this business, say about 20% CAGR? And essentially, how does this business -- is this all India, how does the business work? And how crowded is this space globally?
Thanks, Sanjay. So Sanjay, let me first answer the second part of your question, which is that we cater to both domestic airlines and international airlines. In fact, a large part of our business is international or the international airlines are flying out of India to other to Europe and beyond North America, et cetera. In terms of how the future for this business looks, I really would prefer not make a future-looking statement.
But again, I come back to the Indian economy. If the Indian economy is strong, which we have no reason to doubt it won't be, people will travel to India. If Indian affluence increases people our domestic travel, both inbound and outbound will increase. So all those fundamentals look strong for the airline business.
Yes. Mr. Oberoi, I wanted to understand the potential scalability of this business. So geographically, this INR 115 crores of revenue is basically Indian locations, whether we are catering to domestic or foreign airlines is, as you mentioned, it's both. And how is the competitive landscape when we sort of go to international locations? Is there a plan for...
There's no plan to go international.
Okay. So it's centralized, the food, the preparation, the food preparation is quite centralized?
Well, it's diverse in India Sanjay. It's in different locations in India. But I think what Vikram mentioned is we don't have plans to open any flight catering business outside of India.
We take the next question from Sunny Roy.
Am I audible?
Yes. you are.
I just want to know how much was our management contract fees in this last financial year?
Kallol, you'll have those figures if you'd like to. Again, I don't know if we disclose those, but if we do, we can give you those figures.
So it's about INR 70 crores. The total management fee, including the sales and marketing fees.
And given that occupancy have reached quite an optimal level of around 81%, 82%. So going forward, where do you see this RevPAR growth coming from? Is it from ADR growth? And if so, how do you estimate year-on-year the ADR growth to go for our class of hotels, for the premium and luxury hotels?
So Sunny, I still remain optimistic. First of all, let me cover the occupancy side. Hotels can run well into the 90% occupancy is, number one. And in Bangalore, for example, the hotel there is doing that. So that's the first point I wanted to make. So there is an upside in terms of occupancy.
And there's an upside in terms of rate. Our focus always is rate and charging or having a premium ARR for the service we offer and for the products that we have with or the [indiscernible] we have. And like I mentioned earlier, I believe that with the supply in balance, which is going to increase further over the next few years, there will be significant opportunity to drive ARR up.
Okay. So this supply imbalance, where do you see it coming most from in the metros or in the luxury tourist places. So where is it more -- where is it to be more felt I mean in the -- where do you forecast it to be more?
Very hard for me to comment, and I haven't studied that, so I don't want to make a statement, which is in any way incorrect. So -- but I think there's opportunity to drive rate up both in city and in leisure locations.
We take the next question from Deepak Verma.
Just wanted to check on the lounge business that at least I'm hearing for the first time. First, is it only in India? Is it also -- do you have any plan for abroad? And what's the business outlook, industry outlook and competition, that sort of thing.
This is just a lounge we have. If you're referring to the airport lounge, it's in -- at the Mumbai Airport, it's a single.
Any plans for expansion there?
Nothing that I can talk about today.
The other question is on -- I had, I think, year or so back checked with you if you would like to get some brand Oberoi and Trident may be valued. Any thoughts on that?
No, no thoughts on that Deepak.
[Operator Instructions] Some questions lined up, Vikram, may I take some questions on the Q&A Board?
Sure. Whatever you like, Navin.
Navin, we've already answered these questions because these are.
Yes, Sunny. Most of these have already been answered.
And I think there's a question on whether we can put forward absolute RevPAR growth city wise and not just year-on-year?
Yes, we can really do it from the next presentation onwards, we'll endeavor to do it.
Okay. We have a question from Aditya Menon.
Am I audible?
Yes.
My question was what is the specific drivers that are driving growth in Agra? And are you planning to add any more keys in Agra to cater to that demand?
It's a very good question. The second part, I can't answer at this point because it would be wrong for me to make a statement to you on that. But the first part actually is Amarvilas has seen very strong growth in RevPAR. And that's come from a strong rebound in international travel into India.
That's been a key driver for that hotel.
All right. And how do you plan to stay competitive with many brands like Four Seasons and all opening hotels everywhere, especially in areas like Mumbai?
Well, the Four Seasons has been in Bombay for some time. So it's nothing new. Their hotel in Bangalore has been there, maybe not as long as the Mumbai hotel. But I think our hotels rank exceptionally well in terms of service. And there was a YouGov study.
It's a slightly old study that talked about people who've experienced an Oberoi hotel, that becoming their preferred brand. And if I recall correctly, we outperformed every other brand, including brands like the Four Seasons and others.
But this is a report which is a few years old that I'm referring to.
A couple of new questions on the Q&A board. Manoj S. Please, can you share the payback period on the Goa CapEx? I think it's INR 6 crores per room.
Well, I think, Manoj, it's not INR 6 crores a key, number one. I think the total cost was disclosed in our disclosure note to the stock exchanges. And if you see that, it comes to about INR 4.7 crores a key. But we're really sorry. IRR and payback numbers are quite internal to the organization.
And I think it's not right to share that in a public forum.
Kallol, if I could just add to that. I think if one looks at the average room rates for Oberoi Leisure hotels, you'll see what the rates are. You know what our occupancies are like. So one can easily with a reasonable level of accuracy project top line.
We know what GOP margins are at luxury hotels. So you can probably quite easily with a high degree of accuracy project what the internal rate of return is likely to be. Is that fair to say, Kallol?
Yes, absolutely. Absolutely.
Question from Haiyah. Do you plan to expand beyond airline catering to corporate, sports events, QSR, something which your other listed peers are doing?
We have no plans to do that as of now.
Is the plan to achieve 50 additional hotels...
What needs a mention is the marquee, the Oberoi Concours d'Elegance event that we had conducted. We had done in, you may want to share a few thoughts on that.
I thought Kallol, this was with regard to the flight catering business was the question. Doing outdoor catering and co-corporate catering, et cetera. That was my understanding of the question.
Right. I think talked about...
Expanding the airline catering business to corporate events and sports events and other places. Not limiting it to the airline business.
No, then my answer remains as is.
Is the plan to achieve 50 additional hotels by 2030 well on track?
We will work towards that absolutely.
Deepak Verma asked with Hilton, with Marriott, Hilton, et cetera, having big expansion plans in India. How do we plan to compete?
Well, we're already competing today on STR. If you look at our RevPARs in most locations or Oberoi hotels are STR 1 on the RevPAR index.
Also, if you could share the annual average maintenance CapEx and ROIC on overall basis.
I don't have those numbers with me. Kallol, do you want to...
It's typically around INR 40 crores a year maintenance CapEx.
Maintenance CapEx, yes.
But it can go up and down depending on any special work that is being carried on in any particular location.
And I thought the question was on R&M. Could you just read the question out again, Navin?
I think it said...
If you could share the annual average maintenance CapEx.
Oh maintenance CapEx, sorry. INR 40 crore approximately per year.
Do you plan to open any new hotels in upcoming international airports of Jewar, UP or Navi Mumbai?
I prefer not to comment on that at this point. Kallol, is that fair?
Yes, of course. I mean, we'll keep announcing projects as and when in accordance with the requirements of the SEBI disclosure guidelines. So please watch out for that space, and we will keep announcing as and when things come up.
What Deepak was referring to in his earlier question about the average maintenance CapEx and ROIC. He was referring to the return on invested capital.
So Kallol, return on capital employed figure, if you'd just like to.
Sorry, I didn't get the question. Navin, the question, is it on -- sorry, Deepak, could you just repeat.
I will just repeat the question. Yes, if you could share the annual average maintenance CapEx and ROIC on overall basis.
Okay. So overall basis, the way we calculate ROIC is obviously based on EBIT and the net assets and that's pretty high at almost -- if you take for hotels alone, it will be well over 40%. On an overall basis, also, it's pretty high at close to 29%.
Hope that answers your question, Deepak.
Yes, it does. And congratulations on the great numbers.
Manoj has a question. How much was refurbished Refurbishment costs and expenses for FY '24 and estimate for FY '25?
Kallol, do we want to disclose figures like that?
question. I'm sorry. I mean.
Okay. Aditya Menon. What specific metrics are we focusing on to boost average room rent and expenses during our customers stay? Do we plan to open luxury stores within hotel premises as a newer revenue source?
Sorry, Deepak, could you just read the first part of the question again? I missed that.
What specific metrics are we focusing on to boost average room rate and expenses during a customer's stay?
Okay. So during our customers stay actually, we have an up-selling program, but I don't think it's a major contributor to -- and it's incremental. But I think what's more important is revenue management that we do at each of our hotels to maximize both occupancy and ARR and therefore, RevPAR. And that's something that we do -- in fact, in some of our hotels more than once a day. So that we have very active review of our bar pricing, best available rate pricing, and we do whatever we can based on demand to maximize that.
As do -- and a very similar example for all of us who book online for airline tickets, both domestically and internationally, particularly domestically, you'll see large variations day-to-day on air fares. Hotels are no different. And we pay very close attention to that.
I guess Aditya's question is more about how do you make customers spend more? Because the second part is, do we plan to open luxury stores within hotel premises as a new revenue source?
So we have -- in each of our hotels, we have a store called Tijori and Sandook. Sandook is at Trident and Tijoris are at Oberoi hotels. We don't plan to open -- that's not our business, our business is the hotel business, and that's where we'd like to keep our focus.
Having said that, I think for guests spending more, I think the biggest contributor to that is ensuring our guests have a great experience. And if they enjoy this, they stay, if they're having a good experience, they're likely to spend more money. And our focus is to really look after our guests with sincerity with genuine care and good service so that they have a memorable stay.
They spend more money as a result of that whilst staying with us. But more important than that come back to our hotels and recommend us to their friends and colleagues.
Saloni Jairaj, could you give an indication of what kind of an increase in number of rooms can be expected and what kind of demand is there in the next 2 to 3 years?
So I've already covered demand. Demand is -- your guess is as good as mine -- the figures that I read say that demand is going to grow in the upper upscale and luxury segments by about 8% to 10% over the next 10 years and supply is growing quite a lot slower than that. And we've seen that.
I mean, India is what we've seen in -- happening North America and Europe and other parts of the world in developed economies is no different. So as India progresses, we're moving towards a developed economy. That supply and balance will -- supply-demand imbalance will further increase, and that's good for average room rates going up.
Sunny Roy asked for our managed hotels do the -- does the entire income from management fee flow to our EBITDA?
Yes, it does.
And how much percentage revenue comes from repeat guest loyalty members?
I don't have those figures with me. And I probably -- even if I had them, I wouldn't probably disclose them.
Manoj, a great job on our subsidiary performance in FY '24. Have you reached normalized levels in non-stand-alone level financials or any big areas to improve.
Sorry, Kallol, you'll have to take that question. I'm having trouble understanding that question.
No, I think what is being asked is whether the levels -- by non-stand-alone level, I understand as consolidated. On a consolidated level, whether operations have normalized or reached normalized levels. Like you already said before Vikram that while occupancies are in the early '80s and average room rates is always -- the scope still remains because India is still that way sort of an underperforming market as compared to many of the other countries.
And obviously, although we look at overall occupancy at around 80%, there are several hotels which do well and above of well higher than even 90%. So really speaking, there is still headroom for growth in all these areas. And of course, food and beverage.
Ishant Goyal, would we see a muted top line growth in FY '25, led mainly by ARR increase since occupancy is almost pretty high and not a lot of keys being added this financial year?
I think we've already answered that question in the previous answers that we gave. Unless Kallol wants to add anything further to that I think you just ask for them to...
Vikram, I think Navin will read it out.
All right. Okay. I'm not so technology savvy. I don't know how to get those questions up. So sorry, what's the next question?
Do you want to repeat that?
Yes, I didn't hear the question.
So Navin you can read out from Sanjay Kohli is to admire a budget hotel chains.
Do you admire any budget hotel chains for doing a great job?
Which ones and it comes with a smiley at the end.
Sorry, could you just repeat the question again?
Sure.
Question is.
Do you admire any budget hotel chains for doing a great job, if so, which ones?
Okay. It's a great question. Well, I don't know if it's a budget hotel chain, but it's certainly a lifestyle hotel, and that's citizenM. I don't know if anybody stated a citizenM, but I would recommend staying in a citizenM. It's a unique product, very small rooms, but public carriers, et cetera.
And it's really about co-mingling between guests. So they have large common spaces, which brings guests together, but a very small but comfortable room. I can't remember the size of their rooms, I think it's about 100 -- please don't quote me or please don't -- check it, please check it, but it's certainly under 200 square feet of room.
Kallol, do we have time just to take a couple of more questions.
We actually are a little short on time, Navin, but maybe the next question.
Okay. We'll just take the last question from Yaodna Phatak because he's not had a chance. The others, apologies, we are running out of time. So my e-mail IDs mentioned the bit you may write to me, and I'll take it up with the management.
So Mr. Kallol, you discussed that we don't have Egyptian pound exposure like the fluctuations. So is it fair to assume that the visitors that come in, so we wouldn't have any further currency fluctuation exposure.
Yes, on the revenue side, no. On the expense side, yes, because expenses are incurred in the Egyptian pound and revenues come in U.S. dollars.
All right. Okay. Got it. And sorry, in case I missed it, but could you quantify food and beverages revenue for the quarter as well as the year?
It's roughly around 45% overall on a company basis.
Friends we've run out of time. And before winding up, I'd like to hand over the webinar back to Vikram for his closing remarks.
Well, first of all, thanks so much. And it's always -- we learned from these calls. So just thank you to all the participants. Thank you for your support, and we look forward to our call going forward with the next quarterly results call that we will have.
Kallol, any closing remarks?
No. Thank you so much, Navin, and thank you to all of you. We really -- this is a very good forum for all of us to exchange ideas like Vikram mentioned, and we do look forward to the next one as well. Thank you so much.
On behalf of all of us at SKP, thank you very much Vikram and Kallol for taking time and patiently answering all the questions. Now ladies and gentlemen, thank you for attending the call. And I look forward to hosting you again for the next quarterly webinar. Thank you. Bye-bye.
Thanks so much Navin. Thanks, Kallol.
Thank you, Navin.
Ladies and gentlemen, bye-bye. Bye.