Better demand trends upgrade Indian Hotels to profit suite

Management credits demand-supply gap, shifting demographics for hitting the 'suite spot'

- RAM PRASAD SAHU

After a quiet April-June quarter in 2024-25 (FY25), the operational and financial performance of India's largest listed hotel company, Indian Hotels Company, clearly rebounded in the July-September quarter (Q2) of FY25.

With double-digit growth in the average room rate (ARR) and higher occupancy, the Taj Hotels chain owner reported a 16 per cent revenue increase and a 30 per cent rise in operating profit. Total revenue grew by 27 per cent, including figures from the consolidated airline catering unit, TajSATS.

The company's best-ever Q2 results were well-received on the Street, with stock prices rising over 7 per cent on Friday, pushing its market capitalization above ₹1 trillion. Indian Hotels reported a standalone occupancy rate of 78 per cent, up 210 basis points (bps) from the same quarter last year, while room rates increased by 10.4 per cent to ₹14,321. This led to a 13.4 per cent rise in revenue per available room (RevPAR), which reached ₹11,163.