Shares of this large-cap company jumped 4 percent in Wednesday’s trading session after announcing an infusion of 6.5 million US dollars into the subsidiary. The shares have delivered more than 90 percent returns to its shareholders in one year.
With a market capitalization of Rs. 83,762 crores, the shares of Indian Hotels Company Ltd started Wednesday’s trading session on a flatter note at Rs. 569.55 compared to its previous close of Rs. 569.95. During the trading session, the shares hit a high of Rs. 593, gaining 4 percent and are currently trading at Rs. 591 apiece.
Such a bullish movement in the share price was observed after the company in an exchange filing announced that they had infused 6.5 million US dollars as equity in its wholly owned subsidiary in the Netherlands i.e. IHOCO BV. The investment amount further will be used by IHOCO BV to invest in its subsidiary viz. United Overseas Holding Inc. in the USA to repay its debt and for other operational purposes.
Coming onto the company’s financial statements, the revenue zoomed by 37 percent from Rs. 1,433 crores during the September quarter to Rs. 1,964 crores in the December quarter. In addition, the net profits magnified by 166 percent from Rs. 179 crores to Rs. 477 crores during the same period.
The company has signed 28 new hotels and opened 16 during the fiscal year, reaching a milestone of more than 200 operating hotels and expanding to over 130 locations. New business verticals contributed significantly to revenue, with a 33 percent growth rate, double that of IHCL’s overall growth. Additionally, IHCL has planned around Rs. 750 to 800 crores as capex spending in FY25 to support its growth initiatives.
Recently, IHCL has been about its plans to introduce yet another hotel brand that will cater to the tier-2 and tier-3 markets. Further, plans to open an average of 2 hotels per month or even more in fiscal year 2024-2025.
Looking at the important financial ratios, the Return on Equity(RoE) was recorded at 12.81 percent during FY22-23 and the Return on Capital Employed (RoCE) was at 13.63 percent during the same period. In addition, the Net Profit Margin (NPM) was at 16.72 percent during FY22-23.
Headquartered in Mumbai, Indian Hotels Company was incorporated in 1902. The company is primarily engaged in the business of owning, operating and managing hotels, palaces and resorts.
Written By Vaibhav Patil
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