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ITC Hotels Q1 FY26 Results: Record Performance, Robust Growth, and Long-Term Outlook
CMP: ₹238 | Date: 16 July 2025
1. Recent Insights and Highlights
Management Commentary & Strategic Milestones:
Highest Ever Q1 Revenue & Profits:
Consolidated Revenue: ₹860 Cr, up 20% YoY
Consolidated PAT: ₹134 Cr, up 53% YoY
Strong Room Revenue Growth:
Driven by Retail, MICE, and Weddings segments.
ADR up 9%, Occupancy up 275 bps, RevPAR up 13%; commanding a 34% premium over the industry.
F&B Revenue Robust:
Up 13% YoY, with significant contributions from Banqueting & Outdoor Catering.
Signature restaurant 'Avartana' made its international debut in France.
Expansion & Pipeline:
Portfolio now 200+ hotels (143 operational, 58 in pipeline).
8 new signings in Q1 FY26 (across key cities), targeting 220 hotels & 20,000+ keys by 2030.
Sustainability Leadership:
23 hotels LEED® Platinum certified (highest globally).
12 hotels LEED® Zero Carbon, 9 hotels LEED® Zero Water certified.
Employee & Guest Experience:
Ranked #5 in India’s “Great Place to Work” (only Indian hospitality firm in Top 10).
Net Promoter Score (NPS): 84 (Global avg: 57), Response Rate: 98.98%, Online Rating: 4.74.
2. Consolidated Financial Analysis
a. Income Statement (₹ Cr)
b. Segmental Analysis (Q1 FY26, Consolidated)
Room Revenue Share (Q1 FY26):
Retail: 56%
Contracted: 17%
MICE & Weddings: 24%
Crew: 3%
City-wise RevPAR Premium: ITC Hotels outperformed market RevPAR by 34% across key metros (Jaipur, Chennai, Kolkata, New Delhi, Bengaluru, etc.).
3. Profitability, Growth & Valuation Ratios (CMP ₹238)
Note:
TTM EPS: ₹3.28
Market Cap: ₹49,600 Cr (est. with ~208 Cr shares)
TTM P/E: ~71 (premium, reflecting strong sector outlook and high growth expectations)
4. Industry-Specific KPIs
Key Hospitality KPIs (Q1 FY26):
ADR Growth: +9%
Occupancy: +275 bps YoY
RevPAR: +13% YoY, 34% premium to industry
F&B Revenue Growth: +13%
Portfolio Expansion: 8 signings in Q1, total 200+ hotels (143 operational)
Guest Satisfaction: NPS 84, Response Rate 99%, Online Rating 4.74/5
5. Near-Term & Long-Term Outlook
Near-Term (Q2–Q3 FY26):
Continued robust demand expected across key segments (Retail, MICE, Weddings) with room supply lagging demand in India.
Expansion into Tier 2/3 cities and new premium properties to drive incremental growth.
Short-term headwinds possible from geopolitical or macro shocks, but recovery expected to remain resilient.
Long-Term (FY27–FY30):
Targeting 220 operational hotels and 20,000+ keys by 2030.
Asset-light strategy (management contracts, brownfield expansion) to drive higher margins and ROCE.
Sustainability focus & digital transformation to further brand equity and operational efficiencies.
Indian hospitality market poised for sustained double-digit growth, aided by urbanization, rising incomes, government support for tourism, and increase in business travel.
International expansion (ITC Ratnadipa, Colombo) opens new revenue streams.
6. Conclusion for Long-Term Investors
Key Positives
Record financials: Revenue & PAT at all-time Q1 highs.
Strong brand portfolio, leadership in sustainable hospitality, high guest satisfaction.
Aggressive but efficient expansion pipeline—asset-right strategy.
Improving operational metrics: ADR, Occupancy, RevPAR, EBITDA margin.
Leadership in digital, sustainability, and loyalty programs.
Potential Risks
High P/E valuation—stock already pricing in strong growth.
Macroeconomic/geopolitical risks (as seen in May 2025).
Rising competition as sector attracts more investments.
Dependence on economic cycles, event-driven revenues.
Overall Investment Stance:
Cautiously Optimistic / Long-Term Buy
ITC Hotels stands well-positioned for sector-leading growth, but investors should be mindful of the elevated valuations. Suitable for long-term investors seeking exposure to India’s premium hospitality story.
7. Disclosure
This analysis is provided solely for informational purposes and does not constitute investment advice. Investors should perform their own due diligence before making investment decisions.
