Will Deliver Double-Digit Growth In FY26: Apeejay Surrendra Park Hotels | CNBC TV18

Summary

APJ Surindra Park Hotel has reported impressive fourth-quarter results, with a 45% year-on-year profit growth and an optimistic outlook for the future. The company achieved a 92% occupancy rate, and both revenue per available room (RevPAR) and average room rate (ARR) saw a 13% increase. Looking ahead, the hotel plans to expand its portfolio, adding 250 keys and acquiring Zillion Hotels in Mumbai. The company also expects a double-digit growth in revenue and is confident about maintaining high occupancy rates. Additionally, the growth of Flurries outlets, including plans to open 40-50 outlets annually, remains a key focus.

Takeaways

• 😀 APJ Surindra Park Hotel reported a 45% year-on-year profit growth, driven by lower finance costs and a debt-free status.
• 😀 The company’s fourth-quarter performance exceeded expectations with a 16% increase in top-line growth and a 13% rise in both RevPAR (Revenue per Available Room) and average room rates (ARR).
• 😀 APJ Surindra Park Hotel maintains market leadership in occupancy with a 92% rate, continuing to outperform the hospitality industry.
• 😀 The company has made significant strides in the 2024-2025 fiscal year, including the announcement of its first-ever 50% dividend, marking a milestone in its history.
• 😀 APJ Surindra Park Hotel plans to add 250 keys to its portfolio in FY26, contributing to its expansion strategy.
• 😀 The company has signed a binding MOU to acquire Zillion Hotels & Resorts in Mumbai, converting it into a boutique hotel with 80 rooms and a rooftop bar, expected to open by July next year.
• 😀 The growth outlook for the hotel chain is highly optimistic, with the management forecasting double-digit growth for the upcoming year, supported by strong airline growth and a shortage of hotel rooms in the country.
• 😀 Despite challenges such as geopolitical tensions, APJ Surindra Park Hotel remains confident of achieving high single-digit or low double-digit revenue growth in FY26.
• 😀 Flurries, the cafe chain, has shown impressive growth with a 37% year-on-year increase in sales, and the company plans to expand the brand with 40 to 50 new outlets annually.
• 😀 APJ Surindra Park Hotel’s revenue growth projections for the upcoming year are in the high teens, primarily driven by consistent occupancy levels and higher ARR performance.
• 😀 The company is focused on expanding both its hotel and F&B operations, with further growth expected from new hotels, restaurants, and cafes like Flurries.

Q & A

What was the key driver behind Surindra Park Hotel's profit growth in the fourth quarter?

The key driver behind the profit growth was a nearly 45% increase in profits, aided by lower finance costs after the company became debt-free.

How did Surindra Park Hotel perform in terms of occupancy, RevPAR, and ARR in the fourth quarter?

Surindra Park Hotel maintained a 92% occupancy rate, which is a market leadership position. Both Revenue per Available Room (RevPAR) and Average Room Rate (ARR) grew by 13%, exceeding expectations.

What is Surindra Park Hotel’s outlook for the upcoming year, especially in terms of growth?

Surindra Park Hotel is optimistic about the future, expecting to deliver double-digit growth in the year ahead, with a continued positive outlook driven by strong industry factors.

How many rooms does Surindra Park plan to add in FY26, and what are some significant expansion plans?

Surindra Park Hotel plans to add about 250 new keys in FY26, including a major acquisition of Zillian Hotels and Resorts in Mumbai, which will be transformed into a boutique hotel with 80 rooms.

What factors are driving Surindra Park's confidence in delivering double-digit growth for FY26?

The company is confident in delivering double-digit growth due to positive factors like expected 10% growth in airline passenger traffic and a shortage of hotel rooms in India, which should drive demand.

How does Surindra Park Hotel expect its margins to change, and what is the reason for this?

Surindra Park expects its margins to improve by 100-200 basis points, mainly due to higher ARR, especially with the opening of its new luxury palace hotels.

What is the expected revenue growth for Surindra Park Hotel in the upcoming year?

Surindra Park Hotel expects a revenue growth in the high teens, despite some geopolitical disruptions in May, maintaining strong performance throughout the first quarter.

How is Flurries Café performing, and what are the company’s plans for its expansion?

Flurries Café has seen remarkable growth, with a 37% year-over-year increase in top-line revenue. Surindra Park plans to open 40-50 new Flurries outlets annually, with new outlets opening in Delhi and Mumbai.

What are the key investments Surindra Park Hotel is making in its business?

Surindra Park Hotel is making significant investments in opening new hotels, restaurants, and bars, with a strong focus on both luxury hotels and expanding casual dining options like Flurries.

What makes the opening of the Zillian Hotels and Resorts acquisition particularly significant for Surindra Park Hotel?

The acquisition of Zillian Hotels and Resorts is particularly significant because it will allow Surindra Park to convert the property into a glamorous boutique hotel, adding a new revenue stream, including a rooftop bar, to its portfolio.