Indian Hotels Co. Ltd. · NSE:INDHOTEL
Indian Hotels — The Indian Hotels Company — Q2 FY2022/23 Earnings Presentation
66 slides from Indian Hotels's earnings presentation, Nov 10, 2022
Slide 1: Analyst Presentation cover letter to exchanges
November 10, 2022 BSE Limited National Stock Exchange of India Limited Corporate Relationship Department Exchange Plaza 1st Floor, New Trading Ring, Bandra Kurla Complex Rotunda Building, P. J. Towers, Bandra (E) Dalal Street, Fort, Mumbai 400 051 Mumbai – 400 001. S c r i p C o d e: I N D H O T E L
Slide 2: Delivering Responsible Profitable Growth
Delivering Responsible Profitable Growth GLOBAL CONFERENCE CALL Q2 FY 2022/23 11th November, 2022 1
Slide 3: Q2 2022/23 Exceeds Pre-Covid Performance
Q2 2022/23 EXCEEDS PRE-COVID PERFORMANCE Revenue ↑ 22% EBITDA ↑ 76% EBITDA % ↑ 7.7 pp Best Ever Q2 22/23 ₹ 1,258 Cr ₹ 319 Cr 25.4 % performance across PAT ↑ 70% Strong Free Cash Flows Net Cash Positive key financial metrics ₹ 122 Cr ₹ 181 Cr ₹ 388 Cr# * PAT in 2019/20 included Deferred Tax Liability
Slide 4: Strong Performance: Margin Expansion & Flowthrough
STRONG PERFORMANCE: MARGIN EXPANSION & FLOWTHROUGH PARTICULARS Q2 Q2 Q2 Q2 Q2 Q2 Q2 Q2 Q2 Q2 Q2 Q2 Q2 (₹ CR) 22-23 21-22 20-21 19-20 18-19 17-18 16-17 15-16 14-15 13-14 12-13 11-12 10-11 Revenue 1,258 752 324 1029 981 864 898 928 958 924 835 771 622 EBITDA 319 97 (83) 182 116 67 82 91 36 67 60 92 44
Slide 5: Outperforming the Industry
OUTPERFORMING THE INDUSTRY IHCL Domestic Hotels – Q2 RGI# 2.1 2.1 2.1 1.7 1.6 1.5 1.3 1.3 1.3 1.3 All India Rajasthan Goa Kerala Delhi NCR Hyderabad Mumbai Bengaluru Kolkata Chennai * Data for Domestic Hotels Incl. Ginger, Calculated on Same Store Basis * Source for Industry RevPAR: STR Global # RGI
Slide 6: Robust Growth in Signings, Openings & Pipeline
ROBUST GROWTH IN SIGNINGS, OPENINGS & PIPELINE Signings (#Hotels) Openings (#Hotels) Pipeline (#Rooms) 9 9 8,200 8,300 29 7,500 6,200 22 19 12 13 17 16 4,100 9 7 5 2018/19 2019/20 2020/21 2021/22 2022/23 2018/19 2019/20 2020/21 2021/22 2022/23 2018/19 2019/20 2020/21 2021/22 2022/23 28% of Total Por
Slide 7: Sawai Man Mahal, Jaipur
* 2 Leu Se iF 4, ‘SAWAI MAN MAHAL,
Slide 8: Taj Wayanad Resort & Spa, Kerala
7 TAJ WAYANAD RESORT & SPA, KERALA
Slide 9: Vivanta Shillong, Meghalaya
8 VIVANTA SHILLONG, MEGHALAYA
Slide 10: Vivanta Ahmedabad
fo" Lao s VIVANTA AHMEDABAD
Slide 11: Ginger Ahmedabad, Ginger Goregaon
10 GINGER AHMEDABAD GINGER GOREGAON
Slide 12: Re-imagined Indian F&B Concept Launched at Taj Palace, Delhi
Re-imagined Indian F&B Concept Launched at Taj Palace, Delhi 11
Slide 13: 12
12
Slide 14: Authentic Italian Cuisine Launched at Taj Fort Aguada
Bringing Authentic Italian Cuisine to India, Now Launched at Taj Fort Aguada Resort & Spa, Goa 13
Slide 15: 14
14
Slide 16: Qmin Launch and App Metrics
LAUNCHED ON TOTAL APP DOWNLOADS 25th JUNE 2020 7 LACS+ GMV SINCE INCEPTION ₹ 125 CRS+ 20 CITIES 04 QMIN TRUCKS QMINIZATION OF GINGER QMIN 08 AND COUNTING FOOTPRINT 25 QMIN OUTLETS 40 HOTELS TOTAL ORDERS DELIVERED 20 LACS + Green marketing is a new practice whereby companies seek 15
Slide 17: Ginger Showcases Strong Growth in H1 2022-23
GINGER SHOWCASES STRONG GROWTH IN H1 2022-23 ₹ 143 Cr ₹ 56 Cr 39% PBT +ve 42% Revenue H1 EBITDA > Full 1,500+ bps EBITDA in Each Month of Growth in H1 22/23 Year EBITDA 19/20* Margin Expansion* Current FY *Before Fees to IHCL 16
Slide 18: Operational: 59, Pipeline: 44
Operational : 59 17 Pipeline: 44
Slide 19: Doing Business the Responsible Way - 2030 Goals
DOING BUSINESS THE RESPONSIBLE WAY - 2030 GOALS 100% 100,000 50% 100% Waste Water Youth Energy from Hotels Recycled / Reused Skilled for Livelihood Renewable Sources EarthCheck Certified 100% 100% 100% Hotels go Beyond Adoption of UNESCO’s Intangible Business Meetings & Single-Use Plastic Free Cultu
Slide 20: Doing Business the Responsible Way
DOING BUSINESS THE RESPONSIBLE WAY - Preserving Cultural Heritage 225+ EV charging points installed across 29% Renewable Energy 10 Projects Underway ~100 hotels 9 Sustainable Cooling Projects Underway with IFC 19
Slide 21: Doing Business the Responsible Way
DOING BUSINESS THE RESPONSIBLE WAY - Women Leadership Development 13 Skilling Centers | 1,200+ Students Trained Quarterly newsletter VIBES Women Referral Program Tata Strive Knowledge Partnership Central Theme to the next Tajness Magazine DiWA Skills Program for Women CII – Chhindwara | COE – Bhuban
Slide 22: Outlook: Supply Expected to Remain Constrained
OUTLOOK: SUPPLY EXPECTED TO REMAIN CONSTRAINED CONSTRAINED SUPPLY GROWTH OUTLOOK DEMAND & SUPPLY GROWTH V/S 2019 5% 1,52,945 99% 94,255 93,355 39% 3% 59,238 2012 2022 H1 2022/23 Existing Rooms Proposed Supply Demand Growth Supply Growth Source: Hotelivate Trends & Opportunities Report 2022 Source: S
Slide 23: Outlook: Positive Demand Trends
OUTLOOK: POSITIVE DEMAND TRENDS AIR PASSENGER TRAFFIC VOLUME TO REACH WITNESSING STRONG RECOVERY IN DOMESTIC LEISURE CONTINUES TO BE A KEY PRE-PANDEMIC LEVELS IN FY22-23 CORPORATE TRAVEL DRIVER FOR BUSINESS @ 75% Y-O-Y GROWTH INTERNATIONAL TRAVEL WEDDINGS SEASON, MICE RECOVERY G20 SUMMIT 22
Slide 24: Q3 Hotel Sector Outlook (Source: HVS Anarock)
Q3 HOTEL SECTOR OUTLOOK (SOURCE: HVS ANAROCK) “Q3 FY2023 will also follow the same trend and will outperform Q3 FY2020 by a significant margin. Based on the growth trends in the three quarters, we expect FY2023 to end higher on ADR by 8-10%.” – HVS Anarock INDIAN HOTEL SECTOR: OCCUPANCY INDIAN HOTEL
Slide 25: IHCL Well on Track to Achieve EBITDA Margin Target
IHCL WELL ON TRACK TO ACHIEVE EBITDA MARGIN TARGET 17.6% 25% 33% EBITDA MARGIN – ASPIRATION 2022 AHVAAN 2025 FY 2017/18 24
Slide 26: IHCL Well on Track to Achieve Ahvaan 2025
IHCL WELL ON TRACK TO ACHIEVE AHVAAN 2025 25
Slide 27: Financial Performance Q2 2022/23
FINANCIAL PERFORMANCE Q2 2022/23 GIRIDHAR SANJEEVI, EVP & CFO 26
Slide 28: IHCL Consolidated P&L Statement
IHCL CONSOLIDATED P & L STATEMENT Q2 2022-23 621 PBT PAT +25% Revenue from EBITDA 169 Operations 13.4% Margin 122 Room 1,233 319 9.7% Margin Revenue +22% 25.4% Margin Total Revenue + 7.7 pp Tax 1,258 +22% 44 442 Other +18% Others F&B Expenses Revenue 3 76 151 Management +70% Fee Depreciation 93 103
Slide 29: Key Highlights – Q2 2022/23
KEY HIGHLIGHTS – Q2 2022/23 ₹ /crores IHCL ENTERPRISE* IHCL CONSOLIDATED IHCL STANDALONE 135% 122% 176% 124% 160% 199% 2,345 1,258 1,743 1,029 775 625 585 319 237 294 182 148 Revenue EBITDA Revenue EBITDA Revenue EBITDA Q2 2022 Q2 2019 Q2 2022 Q2 2019 Q2 2022 Q2 2019 Recovery % EBITDA Margin 25.4% (
Slide 30: Key Highlights – Q2 2022/23
KEY HIGHLIGHTS – Q2 2022/23 ₹ /crores UOH Inc. USA St. James Court, London 101% 20% 112% 99% 148 147 117 104 (3) (16) 35 35 Revenue EBITDA Revenue EBITDA Q2 2022 Q2 2019 Q2 2022 Q2 2019 EBITDA Margin* -2% (Pre-Covid : -11%) EBITDA Margin* 35% (Pre-Covid : 39.3%) Pierre, NY cash loss of ₹ 3 crs (Pre-
Slide 31: Key Highlights – Q2 2022/23
KEY HIGHLIGHTS – Q2 2022/23 ₹ /crores PIEM HOTELS LTD ROOTS CORPORATION LTD BENARES HOTELS LTD 116% 285% 143% 255% 162% 302% 106 73 18 92 51 11 26 6 20 7 10 2 Revenue EBITDA Revenue EBITDA Revenue EBITDA Q2 2022 Q2 2019 Q2 2022 Q2 2019 Q2 2022 Q2 2019 EBITDA Margin*: 23% (Pre-Covid : 12%) EBITDA Mar
Slide 32: Is the Double-Digit RevPAR Growth Story Still Intact?
IS THE DOUBLE-DIGIT REVPAR GROWTH STORY STILL INTACT? 128% 120% 120% 149% 138% 143% 132% 123% 149% 10,480 8,182 7,012 6,766 6,381 5,866 4,886 4,898 5,029 4,745 5,040 5,019 4,076 4,366 3,643 3,820 3,551 3,372 Mumbai Delhi & NCR Bengaluru Goa Chennai Rajasthan Hyderabad Kolkata Kerala Domestic Hotels
Slide 33: Are Key International Markets Back to Pre-Covid Levels?
ARE THE KEY INTERNATIONAL MARKETS BACK TO PRE-COVID LEVELS? 92% 96% 118% 135% 415 380 317 329 283 241 126 93 USA UK Maldives Dubai International Hotels RevPAR in $ Q2 2022 Q2 2019 32
Slide 34: How Is the Asset Light Growth Yielding Results?
HOW IS THE ASSET LIGHT GROWTH YIELDING RESULTS? MANAGED SHARE OF PORTFOLIO MANAGEMENT FEE GROWTH BY 70% 76 46% 45 39% Management Contracts % Management fees 2019/20 2022/23 Q2 2019/20 Q2 2022/23 33
Slide 35: How Is IHCL Taking Loyalty to the Next Level?
HOW IS IHCL TAKING LOYALTY TO THE NEXT LEVEL? TOTAL MEMBERS ACTIVE MEMBERS REVENUE (FYTD*) 2 Mn 3.6 Mn ~50% Growth ₹ 1,000+ Cr *Loyalty Led Revenues in April – October 2022 34
Slide 36: How Well Is IHCL Positioned for Business & Leisure Growth?
HOW WELL IS IHCL POSITIONED TO TAKE ADVANTAGE OF BUSINESS & LEISURE GROWTH? HOTEL PORTFOLIO Well Hedged 100+ Locations Authentic 30% Portfolio with Market Grand Palaces with Pan-India Footprint Leadership in India of the Taj 70% Leisure Resorts Across Business Hotels Across Business Leisure 40+ Loca
Slide 37: Recovery Across Different Customer Segments
HOW IS IHCL’s RECOVERY / PERFORMANCE ACROSS DIFFERENT CUSTOMER SEGMENTS? Occ % ARR in ₹ RevPAR in ₹ Domestic Hotels - LFL Q2 2022 Q2 2019 % Q2 2022 Q2 2019 % Q2 2022 Q2 2019 % Business 76% 70% 109% 7,977 6,907 115% 6,069 4,835 126% Leisure 54% 50% 108% 12,505 8,082 155% 6,738 4,039 167% Palaces 43%
Slide 38: Is Inflation a Concern for Indian Hospitality?
IS INFLATION A CONCERN FOR INDIAN HOSPITALITY? 10.1% 10.0% 8.2% 7.4% 4.0% 1.7% 1.7% 1.0% USA UK Eurozone India Sep-19 Sep-22 India Relatively Insulated Compared to Key Major Economies 37
Slide 39: Is IHCL Able to Pass On the Effect of Inflation?
IS IHCL ABLE TO EFFECTIVELY COUNTER AND PASS ON THE EFFECT OF INFLATION? AVERAGE ROOM RATES AVERAGE PRICE PER COVER (v/s 2019/20) (v/s 2019/20) 126% 118% 125% 117% 116% 124% Q1 Q2 H1 Q1 Q2 H1 IHCL IHCL *Domestic Like for Like 38
Slide 40: Is Inflation Resulting in Creep Back of Costs?
IS INFLATION RESULTING IN CREEP BACK OF COSTS? Costs as a percentage of consolidated revenues continue to be lower Fixed Costs as % of Revenue Corp. Overheads as % of Rev. 48% 8.1% 6.7% 37% Q2 2019/20 Q2 2022/23 Q2 2019/20 Q2 2022/23 39
Slide 41: Is Inflation Resulting in Creep Back of Costs?
IS INFLATION RESULTING IN CREEP BACK OF COSTS? PAYROLL EXPENSES RAW MATERIAL COSTS ENERGY COSTS Renewable Sourcing & Energy Efficiency Flat Vs Pre-Covid Lower as % of F&B Revenue vs last year Long Term Gas & Electricity Contract (UK) 40
Slide 42: How Are New Businesses Contributing to Margin Expansion?
HOW ARE NEW BUSINESSES CONTRIBUTING TOWARDS MARGIN EXPANSION? 7.7 pp vs 19/20 Vs Pre Covid 2.9 pp *Asset management in key hotels + New hotels and businesses yielding results Non – Operating Income includes Sale of Flats ₹ 8 crs in Q2 2019/20 41
Slide 43: Does the Free Cash Flow Momentum Continue?
DOES THE FREE CASH FLOW MOMENTUM CONTINUE? Movement in free cash flow ₹ /crores Free Cash Flow ₹ 379 crores Free Cash Flow : Q1 ₹ 198 crs, : Q2 ₹ 181 crs 42
Slide 44: Other Strategic Imperatives
OTHER STRATEGIC IMPERATIVES SIMPLIFICATION MONETIZATION BAND STAND 43
Slide 45: Summary: Key Questions
SUMMARY: KEY QUESTIONS DOUBLE DIGIT DEMAND > SUPPLY INTERNATIONAL CUSTOMER GROWTH MARKETS LOYALTY INFLATION CREEP BACK OF IHCL PRICING FREE CASH FLOWS COSTS POWER NEW BUSINESSES SEGMENT ASSET LIGHT SIMPLIFICATION, PERFORMANCE GROWTH BAND STAND 44
Slide 46: Annexures
AHVAAN 2025: DELIVERING RESPONSIBLE PROFITABLE GROWTH ANNEXURES 45
Slide 47: National Tourism Awards
Taj Mahal Palace, Mumbai NATIONAL TOURISM AWARDS 46 Taj Kumarakom Resort & Spa, Kerala Vivanta Vijayawada, MG Road
Slide 48: Conde Nast Traveller Hotlist
Vivanta Sikkim, Pakyong Pilibhit House, Haridwar – IHCL SeleQtions CONDE NAST TRAVELLER HOTLIST 47
Slide 49: World Travel Awards
ry THETA] MAHAL PALACE INDIA'S LEADING PALACE HOTEL 2022 WORLD TRAVEL AWARDS WORLD TRAVEL AWARDS
Slide 50: Q2 & H1 2022/23 Consolidated P&L
Q2 & H1 2022/23 CONSOLIDATED P&L ₹ /crores Q2 H1 Particulars 2022/23 2021/22 2019/20 Var % 2022/23 2021/22 2019/20 Var % Actual Actual Actual Vs 19/20 Actual Actual Actual Vs 19/20 Revenue from Operations 1,233 728 1,007 22% 2,499 1,073 2,027 23% Non-Operating Revenue 25 24 21 18% 52 50 58 -11% Tota
Slide 51: Q2 Consolidated - Exceptionals
Q2 CONSOLIDATED - EXCEPTIONALS ₹ /crores Q2 H1 Particulars 2022/23 2021/22 2019/20 2022/23 2021/22 2019/20 Actual Actual Actual Actual Actual Actual Gain/ (Loss) on Change in fair value of derivative contracts - - (2) - 6 (0) Exchange Gain / (Loss) - IHMS SA - (11) - (9) (4) - Gain on Sale & Manage
Slide 52: Q2 & H1 2022/23 Standalone P&L
Q2 & H1 2022/23 STANDALONE P&L ₹ /crores Q2 H1 Particulars 2022/23 2021/22 2019/20 Var % 2022/23 2021/22 2019/20 Var % Actual Actual Actual Vs 19/20 Actual Actual Actual Vs 19/20 Revenue from Operations 750 461 599 25% 1,512 669 1,170 29% Non-Operating Revenue 24 19 27 -10% 51 38 63 -19% Total Reven
Slide 53: Q2 Standalone Exceptionals
Q2 STANDALONE EXCEPTIONALS ₹ /crores Q2 H1 Particulars 2022/23 2021/22 2019/20 2022/23 2021/22 2019/20 Actual Actual Actual Actual Actual Actual Gain / (Loss) on Change in fair value of derivative contracts - - (2) - 6 - Provision for Pierre Cash Loss funding (3) (7) (27) (3) (20) (26) Provision for
Slide 54: Q2 2022/23 - Revenue Metrics (Domestic)
Q2 2022/23 - REVENUE METRICS (DOMESTIC) Standalone Enterprise Particulars Q2 2022/23 Q2 2019/20 Q2 2022/23 Q2 2019/20 Occupancy % 70 68 62 65 ARR in ₹ 11,003 8,696 9,552 7,589 RevPAR in ₹ 7,681 5,932 5,942 4,897 (₹/ crores) Room Revenue 318 236 1,122 788 F & B Revenue 284 243 897 691 Other Revenue*
Slide 55: RevPAR Recovery by Destination – Domestic LFL
REVPAR RECOVERY BY DESTINATION VS PRE - COVID – DOMESTIC LFL Occ % ARR in ₹ RevPAR in ₹ Domestic Hotels - LFL Q2 2022 Q2 2019 Recovery% Q2 2022 Q2 2019 Recovery% Q2 2022 Q2 2019 Recovery% Mumbai 81% 75% 108% 10,064 8,455 119% 8,182 6,381 128% Delhi & NCR 73% 78% 93% 6,684 5,204 128% 4,886 4,076 120%
Slide 56: RevPAR Recovery by Destination – International LFL
REVPAR RECOVERY BY DESTINATION VS PRE - COVID – INTERNATIONAL LFL Occ % ARR in $ RevPAR in $ International Hotels - LFL Q2 2022 Q2 2019 % Q2 2022 Q2 2019 % Q2 2022 Q2 2019 % USA 59% 82% 73% 641 509 126% 380 415 92% UK 76% 91% 84% 416 362 115% 317 329 96% Maldives 54% 50% 108% 526 480 109% 283 241 11
Slide 57: Channels – Room Revenue (All Hotels)
CHANNELS – ROOM REVENUE (ALL HOTELS): Q2 22/23 VS 19/20 ₹/crores Q2 22/23 Q2 19/20 HRO TRW GDS ADS Taj Website % of Revenue Q2’ 22/23 48% 6% 5% 26% 15% % of Revenue 48% 11% 9% 24% 8% Q2’ 19/20 56
Slide 58: Market Segment – Room Revenue (All Hotels)
MARKET SEGMENT – ROOM REVENUE (ALL HOTELS): Q2 22/23 VS 19/20 ₹/crores 700 600 Q2 22/23 Q2 19/20 500 400 300 200 100 - Transient Corporate MICE Long Stay Leisure Groups Crew % of Revenue 59% 12% 15% 4% 7% 1% 2% Q2’ 22/23 % of Revenue 16% 15% 5% 7% 2% 3% 52% Q2’ 19/20 Source : Synxis & Hotel Internal
Slide 59: Chambers
CHAMBERS ₹ /crores Chambers Q2 FY 23 Q2 FY 22 Initiation Fees 12 15 Renewal Fees 13 10 Total Income 24 25 Total No. of Chambers members 2,500+ 2,300+ 58
Slide 60: Manpower / Room by Brand
MANPOWER / ROOM BY BRAND 3.39 2.93 3.02 2.17 2.25 1.88 1.95 1.44 1.48 1.20 0.48 0.43 Taj Palaces SeleQtions Vivanta Safari Ginger Apr-20 Sep-22 Manpower Rationalized Through Redeployments – 504 Associates Reimagine ways of working - Multiskilling, Cluster Approach, Shared Services 59
Slide 61: Brandscape – Operating + Pipeline
BRANDSCAPE – OPERATING + PIPELINE LUXURY SELECT HOTELS UPSCALE LEAN LUXE 29,400+ KEYS 247 HOTELS 14,000 KEYS 2,300 KEYS 5,650 KEYS 7,450 KEYS 93 HOTELS 31 HOTELS 40 HOTELS 83 HOTELS *Portfolio figures as on October 31, 2022 including hotels under various stages of development 60
Slide 62: Operating Portfolio
OPERATING PORTFOLIO Inventory by Geography Inventory by Contract Type 2885 4436 8565 18209 8093 Domestic International Holding Company Management Contract Group Companies As of 31st October 2022, IHCL has 182 hotels operational with 21,094 Rooms 61
Slide 63: Upcoming Hotels in FY 22-23
UPCOMING HOTELS IN FY 22-23 (NOVEMBER 2022 TO MARCH 2023) Hotel Name Ownership Inventory Manali - IHCL SeleQtions Managed 33 Jaagir Lodge, Dhudhwa - IHCL SeleQtions Managed 20 Norbu Dharamshala - IHCL SeleQtions Managed 50 Ginger Bharuch Managed 55 Ginger Aurangabad, Jalgaon Road Group Co 64 Taj Ame
Slide 64: Pipeline - As of October 31, 2022
PIPELINE - AS OF OCTOBER 31, 2022 Nov 2022 to Pipeline No. of Brands 2024-25 2025-26 2026-27 March 24 Rooms Hotels Taj 862 438 1,201 2,501 13 IHCL - - Management Contracts 862 438 1,201 2,501 13 SeleQtions 872 308 - 1,180 14 IHCL - - Management Contracts 872 308 1,180 14 Vivanta 549 649 600 80 1,878
Slide 65: Disclaimer
DISCLAIMER These presentations may contain forward-looking statements within the meaning of applicable securities laws. Similarly, statements that describe our business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. Forward-looking statements are not g
Slide 66: Delivering Responsible Profitable Growth
Delivering Responsible Profitable Growth GLOBAL CONFERENCE CALL Q2 FY 2022/23 11th November, 2022 65
The Indian Hotels Company — Q2 FY2022/23 Earnings Presentation on 6ix