During the last 6 months, India’s hospitality sector has delivered a strong return of 6.3 percent. However, two stocks have outperformed this sector. The travel market in India is projected to reach US $125 billion by FY2027, and International Tourist arrival is expected to reach 30.5 million by 2028.
Stock Performance
With a market capitalization of Rs 1,15,455 crore, the shares of Indian Hotels Company Ltd (IHCL) have delivered strong returns of 17 percent over the last six months. It made a 52-week high of Rs 894.90 per share, down by 9.37 percent from its CMP of Rs 811 per share.
With a market capitalization of Rs 3,235 crore, the shares of Taj GVK Hotels & Resorts Ltd. have delivered strong returns of 67.5 percent over the last six months. It made a 52-week high of Rs 528.10 per share, down by 1.9 percent from its CMP of Rs 518 per share.
Future Plans
Indian Hotels Company Ltd (IHCL) plans to double its portfolio from the existing 345 to 700 hotels and double its revenue to Rs. 150 billion by 2030. It also focuses on expanding its Taj brand internationally, targeting markets with a strong Indian diaspora (diaspora means a community of people who do not live in their country of origin but maintain their heritage in a new land) such as London, Singapore, and Switzerland and plans to dominate the domestic market in Tier 2 and Tier 3 cities with its brands like Vivanta, Ginger, Gateway, etc.
Taj GVK Hotels & Resorts Ltd. has capex plans of close to Rs. 250 crore during the period of FY2024 to FY2026 for its upcoming property in Bengaluru. The company aims to reduce its geographical concentration by expanding beyond Hyderabad, with a new hotel in Bengaluru expected to mitigate this risk.
Financial Highlights
IHCL reported a revenue from operations of Rs 2,533 crores in Q3 FY25, up by 29 percent, from its Q3 FY24 revenue of Rs 1,964 crores. It reported a net profit of Rs 614 crores in Q3 FY25, up by 40 percent from its Q3 FY24 net profit of Rs 438 crores.
Taj GVK Hotels & Resorts Ltd. reported a revenue from operations of Rs 126.94 crores in Q3 FY25, up by 14 percent from its Q3 FY24 revenue of Rs 111.13 crores. It reported a net profit of Rs 33.89 crores in Q3 FY25, up by 40 percent from its Q3 FY24 net profit of Rs 24.21 crores.
About the company
The Indian Hotels Company Limited (IHCL) is a leading hospitality company managing hotels, resorts, palaces, and in-flight catering. It was founded in 1902 by Jamshedji Tata and is headquartered in Mumbai, It operates iconic properties like the Taj Mahal Palace Hotel. Its brands include Taj (luxury), SeleQtions (heritage), Vivanta (upscale), and Ginger (budget).
TAJGVK Hotels & Resorts Limited (TAJGVK) is a joint venture between Hyderabad-based GVK Group and the Indian Hotels Company Limited (IHCL), it was formed in 1999. GVK Group is a diversified business conglomerate, while IHCL, a Tata enterprise, operates the Taj Group of Hotels. TAJGVK owns and operates three five-star hotels in Hyderabad and one each in Chennai, Chandigarh, and Mumbai.
Written by Satyajeet Mukherjee
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