Indian Hotels Co. Ltd. · NSE:INDHOTEL
Indian Hotels — The Indian Hotels Company — 26th Annual CLSA India Forum 2023
50 slides from Indian Hotels's conference presentation, Nov 29, 2023
Slide 1: Cover letter: Investor / Analyst Presentation
November 29, 2023 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. Scrip Code: INDHOTEL Scrip Code: 5
Slide 2: Aspiration x Execution = Performance
ASPIRATION X EXECUTION = PERFORMANCE 26th Annual CLSA India Forum 2023
Slide 3: India Growth Story: Favourable Macro-Economic Tailwinds
INDIA GROWTH STORY FAVOURABLE MACRO-ECONOMIC TAILWINDS Services Economy Lowest unemployment levels in 6 years Stable Interest Rates, Favorable Demographics Declining Core Inflation Rising Fastest Growing Discretionary Income Major Economy Globally MACRO TAILWINDS Source: S&P Global, FICCI Report, Eq
Slide 4: Indian Growth Story: IMF Raises Growth Forecast
INDIAN GROWTH STORY IMF RAISES GROWTH FORECAST WORLD USA EU CHINA INDIA 5.9% 6.3% 5.2% 5.0% 3.0% 2.8% 2.1% 1.6% 0.8% 0.7% Industry IHCL Industry IHCL Industry IHCL Industry IHCL Industry IHCL GDP Growth Estimate – IMF Outlook for 2023 Apr’ 23 estimate Oct’ 23 estimate Source: IMF World Economic Outl
Slide 5: India Growth Story: Rising Per Capita Income
INDIA GROWTH STORY RISING PER CAPITA INCOME India’s Per Capita GDP (in USD) – to more than DOUBLE in ten years 5,242 Rising Per Capita Income leading to surge in Disposable Income, 2,278 Driving Higher 1,460 Discretionary Spends. 270 301 451 1982 1992 2002 2012 2022 2032 INDIA POISED TO BECOME THE 3
Slide 6: Government Focus on Increasing Infrastructure Capex
GOVERNMENT FOCUS ON INCREASING INFRASTRUCTURE CAPEX 80 45 e-Tourist Visa Facility for 165 New Airports Projects Expected in next 5 years Sanctioned under PRASAD Scheme Countries Developing Tourism in Development of Mega Convention Centres Mission Mode Bharat Mandapam, Yashobhoomi 5
Slide 7: Indian Hospitality Significantly Underpenetrated
INDIAN HOSPITALITY SIGNIFICANTLY UNDERPENETRATED GLOBAL USA CHINA INDIA Branded Room Supply 18 5.6 4.5 0.2 (mn.) India has much lower Room Population Penetration (mn.) 8,045 340 1,425 1,429 vs. Global Penetration standard (Branded Rooms/1000 2.2 16.3 3.2 0.1 people) Source: US Consensus Bureau, Anal
Slide 8: Supply Growth Constrained, Upcycle to Continue
SUPPLY GROWTH CONSTRAINED UPCYCLE TO CONTINUE Hotel Supply To BRANDED SUPPLY (NO. OF ROOMS) Grow at CAGR of 5-6% CAGR 220,000 In the next 5 years 5.9% CAGR 165,000 5.5% Expected Rooms CAGR 101,000 Demand CAGR of 14.5% 8-10% 39,000 In the next 5 years FY 2007 FY 2014 FY 2023 FY 2028 Source: Hotelivat
Slide 9: Supply Pipeline Primarily in Non-Luxury, Tier 2/3 Markets
SUPPLY PIPELINE PRIMARILY IN NON-LUXURY, TIER 2/3 MARKETS Luxury - Tier 1 Upscale 33% 27% 55,000 55,000 Others Rooms Rooms 67% Tier 2/3 73% Close to 75% of room inventory Supply in top-10 markets to coming up in Tier 2/3 cities be constrained Source: Analyst Research Reports 8
Slide 10: Behavioural Shift: Consumers Splurging on Experiences
BEHAVIOURAL SHIFT CONSUMERS SPLURGING ON EXPERIENCES Source: McKinsey Consumerwise Global Sentiment Data cited from the report titled “The Promise of Travel in the Age of AI” by Skift + McKinsey & Company 9
Slide 11: Demand Bolstered by Short-Term Domestic Triggers
DEMAND BOLSTERED BY SHORT-TERM DOMESTIC TRIGGERS WEDDINGS & EVENTS 10
Slide 12: IHCL Well-Placed to Benefit from Industry & Macro Tailwinds
IHCL WELL-PLACED TO BENEFIT FROM INDUSTRY & MACRO TAILWINDS India Growth Story MACRO-ECONOMIC Hospitality Upcycle, Strong Tailwinds HOSPITALITY INDUSTRY Industry leading Brandscape, Portfolio, Pipeline, Profitability 11
Slide 13: IHCL: A Story of Aspiration, Execution & Performance
IHCL A STORY OF ASPIRATION, EXECUTION & PERFORMANCE ASPIRATION TO RESET DURING SIGHTS ON THE EXECUTION COVID-19 FUTURE CONSISTENT EMERGING AHVAAN PERFORMANCE STRONGER 2025 12
Slide 14: We Promised Profitability, We Delivered Record Performance
WE PROMISED PROFITABILITY, WE DELIVERED RECORD PERFORMANCE 13
Slide 15: Record Financial Performance Achieving Key Milestones
RECORD FINANCIAL PERFORMANCE ACHIEVING KEY MILESTONES ₹ 11,000 Crore ₹ 1,000 Crore ₹ 1,000 Crore ₹ 50,000 Crore Enterprise Consol. Free Cash Market Revenue PAT Flows Capitalization 1.5X 2.8X 3.5X 2.5X PRE-COVID LEVEL All figures for FY23 14
Slide 16: Underpinned by Resilient Balance Sheet, Strong FCF
UNDERPINNED BY Resilient Balance Sheet, Strong FCF FROM NET DEBT TO NET CASH STRONG REBOUND IN FREE CASH FLOWS 987 1,017 98 Net Cash Positive 290 -1,915 -92 -870 -3,110 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 19-20 FY 20-21 FY 21-22 FY 22-23 ₹ /crores ₹ /crores 15
Slide 17: We Promised a Re-imagined Brandscape, We Delivered Performance Across Brands
WE PROMISED A RE-IMAGINED BRANDSCAPE, WE DELIVERED PERFORMANCE ACROSS BRANDS 16
Slide 18: We Continued to Invest Strongly in Brand-Building
WE CONTINUED TO INVEST STRONGLY IN BRAND-BUILDING 17
Slide 19: Taj Ranked Strongest Brand in India
paceeeeeeeeel Sd, bt TAJ Ranked Once Again as STRONGEST BRAND IN INDIA ACROSS SECTORS & INDUSTRIES By Brand Finance’ 2023 ¢ 2022 + 2020
Slide 20: World's Strongest Hotel Brand
WORLD’S STRONGEST HOTEL BRAND 2021, 2022 WORLD’S4th4th STRONGEST HOTEL BRAND 2023 2023 19
Slide 21: Rambagh Palace Rated World's #1 Hotel by TripAdvisor
RAMBAGH PALACE RAMBAGH PALACE RATED WORLD’S #1 HOTEL RATED WORLD’S #1 HOTEL BY TRIPADVISOR Source Source : 2023 : 2023 Travellers’ Travellers’ Choice Choice Awards Awards byby TripAdvisor TripAdvisor 20
Slide 22: Focus on F&B: Scaling-up Brands, Introducing New Concepts
FOCUS ON F&B SCALING-UP BRANDS, INTRODUCING NEW CONCEPTS SCALING-UP EXISTING BRANDS Delhi, Bhopal, Jaipur Delhi, Bhopal, Jaipur, Bangalore Cape Town, Dubai, London Mumbai, Dubai, Kerala, Kolkata INTRODUCING NEW CONCEPTS Mumbai, Goa Goa, Bangalore Goa Mumbai, Delhi, Bangalore 21
Slide 23: New Businesses Well Geared to Scale-up
NEW BUSINESSES WELL GEARED TO SCALE-UP ₹ 170 Cr 125+ villas GMV 75 Operational (Since Inception) 40+ 90+ Outlets NPS Score (Across 20+ Cities) 22
Slide 24: We Unleashed the Power of All Brands
WE UNLEASHED THE POWER OF ALL BRANDS Enterprise Revenue (₹ Crores) FY 2017-18 FY 2022-23 4600 8000 1800 1800 200 360 420 640 IHCL Enterprise Revenue 7,000 11,000 Note: Rounded off-values 23
Slide 25: We Promised Growth, We Delivered Unprecedented Expansion
WE PROMISED GROWTH, WE DELIVERED UNPRECEDENTED EXPANSION 24
Slide 26: Development Strategy: Asset SMART
DEVELOPMENT STRATEGY ASSET SMART S M A R T Margin Asset Strategic Enhancement Management Relationships Tracking 25
Slide 27: Industry Leading Portfolio, Pipeline
INDUSTRY LEADING PORTFOLIO, PIPELINE PORTFOLIO OF HOTELS SHIFT IN 193 83 PORTFOLIO MIX Operational + Pipeline = 276 50:50 Owned V/S Managed 104 86 86 As on 31st October 2023
Slide 28: Portfolio Growth
PORTFOLIO GROWTH NO. OF HOTELS 175 187 193 145 149 158 165 73 83 42 56 60 20 30 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 Operational Pipeline (YTD 31st Oct) 104 86 86 50 59 46 Note: Including pipeline
Slide 29: Highest Signings in the Country by Any Operator in 2022
HIGHEST SIGNINGS IN THE COUNTRY BY ANY OPERATOR IN 2022 NO. OF HOTEL SIGNINGS 36 29 22 19 19 17 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 (YTD 31st Oct) #2 #1 #1 #1 #1 Source: HVS Anarock India Hospitality Review 2022
Slide 30: Highest Number of Openings: 60+ Hotels in Six Years
HIGHEST NUMBER OF OPENINGS: 60+ HOTELS IN SIX YEARS NO. OF HOTELS OPENED 20+ 16 12 13 9 7 5 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 (YTD 31st Oct) Projection 29
Slide 31: Now Open – Ginger Mumbai Airport
NOW OPEN – GINGER MUMBAI AIRPORT
Slide 32: We Promised Iconic Hospitality, We Delivered World-Class Customer Centricity
WE PROMISED ICONIC HOSPITALITY, WE DELIVERED WORLD-CLASS CUSTOMER CENTRICITY 31
Slide 33: Excellence - Best NPS Scores & Reviews Globally
EXCELLENCE - BEST NPS SCORES & REVIEWS GLOBALLY NPS Online Ratings 70 67.8 68.6 68 66 64 62 60.3 60 96.32 85.52 91.28 TAJ* 58 56 Peer Set Avg. 2nd Best TAJ* NPS Peer Set 86.92 82.56 87.42 Brands in the NPS subscriber base: Mandarin Oriental, Fairmont, Pullman, Sofitel, Grand Mercure, Aman, Movenpick
Slide 34: Loyalty Re-imagined: Tata Neu
LOYALTY RE-IMAGINED TATA NEU 4.9 Mn Total Members as of 31st Oct.23 (↑ 130% Vs FY19-20) ₹ 2,200 Cr+ Loyalty Led Revenues in FY23 Award-winning Enhanced Scale, (↑ 83% Vs FY19-20) Signature loyalty Efficiency and Customer program of IHCL Engagement 24% contribution to IHCL Enterprise Revenues in FY23
Slide 35: Enabled by Focus on Culture & ESG
ENABLED BY FOCUS ON CULTURE & ESG 34
Slide 36: Living the IHCL Values: Tata Values
LIVING THE IHCL VALUES TATA VALUES VALUES Excellence Trust Awareness Joy Integrity Unity Pioneering Responsibility 35
Slide 37: Culture of Camaraderie: Celebrating Spirit of Tajness
CULTURE OF CAMARADERIE CELEBRATING SPIRIT OF TAJNESS OBJECTIVES KEY ELEMENTS OF THE DAY Looking back at our journey since Leaders Speak March 24, 2020 Memorial Service Resilience, Responsiveness and Resurgence Special Meals Engaging Activities A day of gratitude 36
Slide 38: Culture of Responsible Business
CULTURE OF RESPONSIBLE BUSINESS PRESERVE PROMOTE Heritage & Brand Environmental Stewardship PROGRESS PROMISE Sustainable Growth Social Responsibility PA R T N E R PRUDENT Transformation Corporate Governance 37
Slide 39: Culture of Responsible Business: 2030 Goals
CULTURE OF RESPONSIBLE BUSINESS 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 Cultural H
Slide 40: Progressing Well on Paathya
PROGRESSING WELL ON PAATHYA 2030 TARGETS Waste Waste Water Energy All hotels to provide Skilling 100% elimination of 100% operating hotels 100% water 50% energy use to EV charging stations Empowering livelihoods single-use plastic will have an organic recycling be from renewables of 100,000 youth wa
Slide 41: The Result: Delivering Responsible Profitable Growth
THE RESULT: DELIVERING RESPONSIBLE PROFITABLE GROWTH 40
Slide 42: Journey of Financial Turnaround – Consolidated P&L
JOURNEY OF FINANCIAL TURNAROUND – CONSOLIDATED P&L PARTICULARS FY FY FY FY FY FY FY FY FY FY FY FY FY (₹ 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 5,949 3,211 1,740 4,596 4,595 4,165 4,076 4,123 4,287 4,126 3,804 3,515 2,898 EBITDA 1,943 560 (197) 1100
Slide 43: 6th Consecutive Quarter of Record Performance
6th CONSECUTIVE QUARTER OF RECORD PERFORMANCE ₹ 1,481 Crore ₹ 402 Crore 27.2% ₹ 167 Crore Consol. Revenue Consol. EBITDA EBITDA margin Consol. PAT Increase Over ↑ 18% ↑ 26% ↑ 1.8 pp ↑ 37% Consol. Revenue Consol. EBITDA EBITDA Margin Consol. PAT Q2 FY23 Consol. H1 23/24 PAT at ₹ 389 Cr surpassed high
Slide 44: Asset Light & High Margin Focus - Management Fees
ASSET LIGHT & HIGH MARGIN FOCUS - MANAGEMENT FEES 600+ 399 400+ AHVAAN 2025 213 204 213 POTENTIAL UPDATED ₹/ Crores 17-18 18-19 19-20 22-23 AHVAAN 2025 UPDATED POTENTIAL POTENTIAL Rapid increase in hotels under management, to fuel High Flow Through Management Fee Growth 43
Slide 45: Significant Increase in Consolidated ROCE %
SIGNIFICANT INCREASE IN CONSOLIDATED ROCE % 13 8 7 5 2017-18 2018-19 2019-20 2022-23 44
Slide 46: Enterprise Performance & Potential
ENTERPRISE PERFORMANCE & POTENTIAL ~7,000 ~11,000 ~15,000 2017-18 2022-23 AHVAAN 2025 Potential ₹ Crores 45
Slide 47: Well Positioned for the Future: AHVAAN 2025
WELL POSITIONED FOR THE FUTURE AHVAAN 2025 46
Slide 48: We Promise, and We Will Deliver
WE PROMISE, AND WE WILL DELIVER 47
Slide 49: Aspiration x Execution = Performance
ASPIRATION X EXECUTION = PERFORMANCE 26th Annual CLSA India Forum 2023
Slide 50: Disclaimer
Disclaimer This presentation contains selected information about the activities of the Company and the Group as at the date of this presentation. The information in this document have been collected with the purpose to provide interested parties with information about the Group including but not lim
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