Leela Palaces Hotels & Resorts Ltd — Q4 FY26

Leela Palaces Hotels & Resorts Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=PpAxVzn1h4U Published: 2 weeks ago

0:00 Ladies and gentlemen, good day and welcome to the Q4 FY26 earnings call of 0:07 7 seconds Leela Palac's Hotels and Resorts Limited. As a reminder, all participant lines will be in the listenonly mode and 0:16 16 seconds there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance 0:23 23 seconds during this conference call, please signal an operator by pressing star then zero on your touchstone phone. Please 0:30 30 seconds note that this conference is being recorded. I now hand the conference over to Mr. Abhishek Agarwal from the Leela. 0:38 38 seconds Thank you and over to you sir. 0:41 41 seconds Thank you operator. Good evening everyone. I'm Abhishek Agarwal, senior VP FPNA and investor relations. Welcome to the global earnings call for the Q4 0:50 50 seconds and FY26 results of VA Palaces Hotels and Resorts Limited, India's only pure play luxury hospitality company. We have 0:58 58 seconds published our results and uploaded the investor presentation on exchanges earlier today and you can also find it on the company website www.theala.com/investors. 1:09 1 minute, 9 seconds Before we start, a disclaimer. We would like to inform you that the management may make certain comments on this call that one could lean forward to these statements. Specifically, the financial 1:18 1 minute, 18 seconds guidance and perform information that we will provide on this call are management estimates based on certain assumptions and have not been subjected to any audit 1:25 1 minute, 25 seconds review or examination procedures. The company does not guarantee these statements and is not obliged to update them at any time. Participants are 1:33 1 minute, 33 seconds cautioned not to place undue reliance on these forward-looking statements while making the investment decisions. To answer your questions and you take you 1:40 1 minute, 40 seconds through the story, we have the senior management of Leela on the conference call. Joining me today are Mr. Anurrad Batnaga, four-time director and CEO and 1:49 1 minute, 49 seconds Mr. Ravi Shanka, head of asset management and CFO. Without further ado, I would like to hand over the call to Mr. Batnaga. Over to you. 1:57 1 minute, 57 seconds Thank you. Thank you, Vishek. Pleased to have you with us as we further strengthen how we engage with our stakeholders alongside the next phase of 2:05 2 minutes, 5 seconds growth. Good evening everyone and thank you for joining us. 2:09 2 minutes, 9 seconds A for FI26 has been a transformational year defined by strong financial and operational performance, disciplined and 2:17 2 minutes, 17 seconds consistent execution and sustained leadership in Indian luxury hospitality. 2:22 2 minutes, 22 seconds We have outpaced the industry in growth and margins and also had the highest ever annual key expansions in our 2:29 2 minutes, 29 seconds portfolio. Importantly, this performance was delivered in a year characterized by elevated external volatility 2:37 2 minutes, 37 seconds underscoring the resilience of both our brand and our operating platform. Let me begin with the macro context and the key performance highlights in that context. 2:46 2 minutes, 46 seconds FI26 was the year in which the Indian hotel industry navigated multiple headwinds across aviation disruptions 2:53 2 minutes, 53 seconds and geopolitical events. Against the backdrop of the Middle East conflict in Q4 FY26, the LEA delivered doubledigit growth in operating revenue and operating IBITA. 3:05 3 minutes, 5 seconds This performance was underpinned by a 15% year-on-year increase in area, reflecting the leader's strong consumer 3:13 3 minutes, 13 seconds pull, brand pricing power, and disciplined execution. Together, these results reaffirm the brand's premium 3:20 3 minutes, 20 seconds positioning and ability to deliver superior commercial outcomes even in a challenging operating environment. Our 3:28 3 minutes, 28 seconds business has been rooted in the thesis that our demand is more resilient and the previous quarter underscores the same. While occupancy in March took a 3:37 3 minutes, 37 seconds hit due to international travel being disrupted, we continue to grow ADRs in double digits. Domestic demand remains 3:45 3 minutes, 45 seconds robust and we have focused on it to offset the impact on international inbounds. In past instances of 3:52 3 minutes, 52 seconds disruption like operation Synindhur, occupancy bounced back quickly to previous levels and we remain confident that the current impact will get mitigated once the situation normalizes. 4:04 4 minutes, 4 seconds The structural drivers ofos luxury hospitality demand in India remain firmly intact and the outlook continues 4:11 4 minutes, 11 seconds to be compelling supported by rising aspirational spending, wealth creation and a growing cohort of experiential luxury consumers. 4:21 4 minutes, 21 seconds Importantly, new luxury supply in the leader's key micro market remains constrained. This has enabled us to 4:28 4 minutes, 28 seconds consistently outperform the market, drive market share gains, and sustain improvements in both occupancy and pricing. Together, these factors 4:37 4 minutes, 37 seconds underpin strong same store growth over the medium to long term. 4:43 4 minutes, 43 seconds Taking you through the highlights of FI26. At the Leela, guest experience is the bedrock of all performance outcomes 4:51 4 minutes, 51 seconds and our defining differentiator. For FY26, we recorded a net promoter score of 86, 4:59 4 minutes, 59 seconds maintaining our position as the highest rated luxury hospitality brand in India. 5:04 5 minutes, 4 seconds Importantly, we extended our lead to 12 points above the Asia-Pacific luxury industry average. This sustained 5:12 5 minutes, 12 seconds multi-year outperformance reflects the consistency of our service delivery and the depth of our brand equity, 5:19 5 minutes, 19 seconds guaranteed supporting long-term pricing power. 5:22 5 minutes, 22 seconds We also delivered significant market share gains continuing to outperform the broader luxury segment in India. In 5:30 5 minutes, 30 seconds FI26, the LEA achieved 11 points increase in market share with a refar 5:37 5 minutes, 37 seconds index strengthening to 150. Notably, our REFPA growth exceeded industry by more than two times, supported by doubledigit 5:46 5 minutes, 46 seconds growth and market share expansion across both key city markets and leisure destinations. This translates into a ref 5:54 5 minutes, 54 seconds premium of approximately 6,000 INR over the India luxury segment. Overall in 6:01 6 minutes, 1 second FI26, our same store refar increased 14%. Supported by doubledigit growth across all five own palaces and an 6:10 6 minutes, 10 seconds overall 13% increase in area. The operating leverage from this pricing led growth resulted in a 19% year-on-year 6:19 6 minutes, 19 seconds increase in operating IITA with margin expanding by 167 bits to a best-in-class 49%. 6:27 6 minutes, 27 seconds This operating momentum culminated in a record profit after tax of 403 crores in 6:33 6 minutes, 33 seconds FI26 representing a decisive turnaround from a PAT of 48 crores in FI25. 6:41 6 minutes, 41 seconds This 8.5x increase in profitability underscores the structural strengthening of the business driven by sustained same 6:49 6 minutes, 49 seconds store ref growth, targeted asset enhancements, key portfolio additions, and reduction in finance costs. From an 6:57 6 minutes, 57 seconds expansion standpoint, FYI26 marked LEA's fastest pace of expansion ever with 23% 7:05 7 minutes, 5 seconds growth in keys totaling to a visibility of 966 additional keys. These additions 7:11 7 minutes, 11 seconds came across Mumbai, BKC, Dubai, Jesselare and K and will strengthen our presence across marquee urban and leisure destinations. 7:21 7 minutes, 21 seconds Our net debt reduced by 50% with net debt to IIDA are now at a conservative 1.6x in FI26. 7:29 7 minutes, 29 seconds Supported by a strong double A credit rate rating and strong cash conversion, we now operate with meaningful financial 7:36 7 minutes, 36 seconds headroom to fund expansion and manage future capex while maintaining flexibility across cycles. Giving you 7:44 7 minutes, 44 seconds some more color into our operating performance and growth plans. Our non- room revenue, our focus on FNV excellence continue to deliver results in FI26. 7:55 7 minutes, 55 seconds FNB revenues grow 15% yearonear driven by strong performance across both restaurants and banqueting. This growth 8:03 8 minutes, 3 seconds was supported by approximately 13% increase in non-resident footfalls across the city hotels reflecting the 8:10 8 minutes, 10 seconds increasing relevance of the as a destination for dining events and experiences beyond resident guest. 8:18 8 minutes, 18 seconds Consequently, non-resident covers now constitute 54% of the total cover mix at our city hotels. 8:25 8 minutes, 25 seconds We have continued our progress on strategic growth and expansion of the LEA footprint. During fourth quarter of 8:32 8 minutes, 32 seconds FI26, the Leela strengthened its leisure portfolio with the acquisition of 71key ultra luxury all villa operational 8:41 8 minutes, 41 seconds resort in Kur to be unveiled as the Leela Kur forest century making our entry into nature immersive and wellness 8:49 8 minutes, 49 seconds anchored hospitality. We are very excited about this hotel addition as it's a unique hotel built to Leela 8:56 8 minutes, 56 seconds standards across 76 acres and with 25 rooms having heated pools. The programming of this hotel will offer 9:04 9 minutes, 4 seconds multi-day experiences for a multigenerational family. This acquisition reinforces our strategy of discipline high return expansion into 9:13 9 minutes, 13 seconds premium leisure destinations and underscores our focus on value growth. 9:18 9 minutes, 18 seconds In addition, we are all set to open the Relie Jalmare and the Rela Luxury Residences Mumbai in FY27. 9:27 9 minutes, 27 seconds We continue to deliver growth in our portfolio emissions. The Leila Hyderabad a managed hotel which opened in FY 2025 9:35 9 minutes, 35 seconds demonstrated strong operating leverage by achieving healthy margin within its first year of operations operating at 9:42 9 minutes, 42 seconds 62% occupancy in first fiscal year of launch and delivering an average daily rate which is 1.24x compared to its peer 9:51 9 minutes, 51 seconds set. We continue to actively evaluate value equitative opportunities that complement our portfolio and reinforce 9:58 9 minutes, 58 seconds the Leela's positioning across India's most iconic and high growth markets. Our green field development agenda continues 10:06 10 minutes, 6 seconds to progress steadily. Construction activity and execution milestones are advancing on plan across Bandhavar, 10:14 10 minutes, 14 seconds Shinagar, Sikkim, Agra, Aayodhya and Vantamore with progress across design, development, demolition, excavation, 10:23 10 minutes, 23 seconds piling and site preparation and structural works. 10:28 10 minutes, 28 seconds The Leela continues to be recognized as the leader in luxury hospitality across global and domestic platforms. We were 10:34 10 minutes, 34 seconds once again voted India's best hotel group at the travel and leisure India best awards 2025 for the sixth 10:43 10 minutes, 43 seconds consecutive year which is a strong endorsement of a sustained consumer propert. We also received the Michelin 10:50 10 minutes, 50 seconds keys 2025 for the Palace New Delhi Palace Japur and the Rela Palace Chennai placing these hotels in a globally 10:59 10 minutes, 59 seconds benchmark league. On the FMV front, ZLV23 at the Leela Palace, Bangaloru continues to feature across 30 best bars 11:08 11 minutes, 8 seconds in India and Asia's 50 best bars 2025 alongside continued recognition for Lasser, the library bar and Navy. 11:17 11 minutes, 17 seconds Overall, these recognitions reinforce the strength of our brand and the consistency of our delivery across key experiential pillars. People remain at 11:27 11 minutes, 27 seconds the heart of our success. During FI26, we reinforced our position as an employer of choice through 11:34 11 minutes, 34 seconds industry-leading talent development initiatives and onboarded few 45 future leaders through our LEA leadership development programs. 11:43 11 minutes, 43 seconds This year we also achieved great place to work recognition. We are also preparing for the launch of the Leela 11:50 11 minutes, 50 seconds center of excellence, our dedicated learning infrastructure. 11:56 11 minutes, 56 seconds During FI26, we remained committed to our ESG philosophy, creating long-term value while delivering experiences that are 12:04 12 minutes, 4 seconds both luxurious and responsible. We commissioned 2.25 25 megawatt of solar capacity at the VA Palace Chennai 12:12 12 minutes, 12 seconds increasing our green energy usage to 67% of our total consumption while reducing 12:18 12 minutes, 18 seconds power and fuel cost to 3% of operating revenues from 3.3% in FY25 enhancing 12:26 12 minutes, 26 seconds long-term operating efficiency. We advance a social impact initiatives by supporting the livelihoods of thousand 12:33 12 minutes, 33 seconds plus women through upycling three metric tons of floral waste, sourcing 45% of our tea from carbon neutral estates and 12:42 12 minutes, 42 seconds transitioning to 100% artisanmade jutebacks, reinforcing our commitment to responsible luxuries. 12:49 12 minutes, 49 seconds This is a very important year for us. As we enter the new financial year, we are very pleased to share with you that the 12:56 12 minutes, 56 seconds Leela has now completed four decades of customer love and trust. Four decades of true Indian luxury. The 40th year serves 13:06 13 minutes, 6 seconds as a strategic platform to reinforce the brand's leadership in true Indian luxury. Leveraging four decades of heritage and excellence, we will deepen 13:14 13 minutes, 14 seconds guest engagement, strengthen brand visibility and accelerate premiumization through curio curated experiences and 13:23 13 minutes, 23 seconds differentiated stories storytelling across the portfolio. I will now hand over the call to Mr. 13:29 13 minutes, 29 seconds Ravi Shankar, our CFO and head of asset management to take you through the financial highlights for the quarter and the year ending 31st March 26. 13:38 13 minutes, 38 seconds Thank you Anurra. Good evening everyone. 13:40 13 minutes, 40 seconds Let me take you through the financial performance for the quarter and the year ended 31st March 2026. 13:46 13 minutes, 46 seconds Quarter 4 FI 26 months again highlighted the strength, efficiency and the resilience of the LEA platform in line 13:54 13 minutes, 54 seconds with the strong ADIA momentum. Operating revenue increased 12% YI to 484 Kores while the operating IBIDA rose 13% YI to 14:03 14 minutes, 3 seconds 266 K delivering a best-in-class IBIDA margin of 55% an expansion of 57 basis point increased 14:12 14 minutes, 12 seconds from 117 crores in quarter 4 FI25 to 172 crores turning to FI26 performance the 14:20 14 minutes, 20 seconds company reported a robust all round performance driven by improvement in both ADR and occupancy. 14:27 14 minutes, 27 seconds Strong momentum in the retail and group segment supported a doubledigit left park growth across both city hotels and resort properties. This drove operating 14:36 14 minutes, 36 seconds revenue up 15% YI to 1,527 Kores. 14:41 14 minutes, 41 seconds Operating Eidar was 19% YI to 743 Kores with margin expanding by 167 to 49%. 14:49 14 minutes, 49 seconds Again, best-in-class over 60% of the incremental revenue converted to operating IBIDA, reflecting robust operating leverage and disciplined cost management. 15:01 15 minutes, 1 second Active asset management continues to be a key pillar of value creation at the LEA with a focus on enhancing guest experience, unlocking incremental 15:10 15 minutes, 10 seconds revenue streams and ITA and improving the asset level returns. During FI26, we progressed multiple value accretive 15:17 15 minutes, 17 seconds initiative across the portfolio including launch of the earth by the Leela at the Lela palace Bangalore, our invite only 15:25 15 minutes, 25 seconds ultra luxury membership club with the development work at advanced stages. ARK is slated to open in New Delhi in quarter 1 FI27 and in Chennai in quarter 15:34 15 minutes, 34 seconds 2 FI27 followed by Mumbai in the later part of the year expanding this high engagement platform across key markets. 15:43 15 minutes, 43 seconds We also refurbished and added seven FNB outlet across the Leela Palace, New Delhi Jauna location. We relaunched of 15:51 15 minutes, 51 seconds approximately 334,000 ft² of high-end retail space at Leela Palace, Bangalore, 100% occupied. Reimagined Span wellness 15:59 15 minutes, 59 seconds offering at the Lela Palace, Jaipur. Our wellness initiatives are being expanded to Bangalore as well. 16:06 16 minutes, 6 seconds Introduction of exclusive kids club at Leela Palace Japur and Udapur. 16:11 16 minutes, 11 seconds conversion of select villas into premium private villas cing to a multi-generation travel at the Leela Palace airport. These initiatives are 16:18 16 minutes, 18 seconds being executed with disciplined capital allocation and are targeted to deliver a projected yield on cost of approx 25%. 16:26 16 minutes, 26 seconds Reinforcing our focus on driving high returns from existing asset while strengthening the long-term quality and durability of the earnings. 16:34 16 minutes, 34 seconds To summarize, FY26 demonstrated the reliability to outperform the industry with resilience and consistency despite 16:42 16 minutes, 42 seconds geopolitical challenges. The continued expansion of the LEA footprint takes our portfolio to over 5,200 luxury keys 16:50 16 minutes, 50 seconds across 24 properties, spanning 15 operational hotels and nine in the pipeline. Our balanced mix of own and 16:58 16 minutes, 58 seconds managed key enable disciplined capital deployment while expanding its reach and scale. 17:05 17 minutes, 5 seconds Before concluding, we would like to thank all our associates for the unwavering commitment to excellence and guest delight. 17:13 17 minutes, 13 seconds Thanks Anural and Ravi. Operator, we can start the Q&A session now. 17:19 17 minutes, 19 seconds Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. 17:30 17 minutes, 30 seconds If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use 17:36 17 minutes, 36 seconds handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question Q assembles. 17:48 17 minutes, 48 seconds Our first question comes from the line of Ben Singh from Morgan Stanley. Please go ahead. 17:55 17 minutes, 55 seconds Uh hi team. uh congrats for a good set of numbers uh given the environment we are in. Uh could you throw a bit more light on how were trends in March 18:04 18 minutes, 4 seconds because we see quite a sharp drop in occupancy whereas the war impact would have been only there for one month. So could you specifically show show share 18:12 18 minutes, 12 seconds some trends on March and how is April May also trending? That'll be the first question. 18:20 18 minutes, 20 seconds Hi Vin, good evening. uh the west Asia war has had an impact on travel as we all know both inbound and outbound. So 18:28 18 minutes, 28 seconds just to give some context, Leela has almost a 5050% share in terms of both international and domestic business. Our 18:36 18 minutes, 36 seconds domestic business has not been impacted at all. And while some part of our international business has been impacted from a key source market just for 18:44 18 minutes, 44 seconds context, despite the disruption for the overall quarter, we have achieved a 15% ADR growth and a 6% growth year on year 18:54 18 minutes, 54 seconds despite the disruption in the month of March. What we have also done, we have strengthened our domestic customer base which has allowed our occupancy in April 19:03 19 minutes, 3 seconds to recover to your question to similar levels as last year and healthy ref growth versus same time last year. This 19:11 19 minutes, 11 seconds is also bases on the strength of our uh robust sales and distribution channels in India where we have over 300% sales 19:19 19 minutes, 19 seconds associate nine regional sales offices and revenue members on the ground that control nearly 2/3 of our revenue which 19:26 19 minutes, 26 seconds comes from our direct channels. We continue to be very nimble, keep watching the situation very closely and keep working with agility on all the 19:34 19 minutes, 34 seconds segmentation and we expect the domestic market to remain a strong opportunity for future growth as well as we approach the holiday season while the inbound 19:43 19 minutes, 43 seconds presence of future opportunity given the strong brand recall and the brand love that we have from our key source markets post stabilization. 19:52 19 minutes, 52 seconds Uh thanks for that. But just two sort of u uh in any numbers on how March is and how like so March would have been down double digit for us and then April are 20:01 20 minutes, 1 second we talking about high single digit repar growth? Um so March yes there was an impact on occupancy I would say because some of 20:10 20 minutes, 10 seconds our key sport force markets like US and and UK there was an impact in terms of occupancy but our resilience on our pricing power and all that allowed us to 20:19 20 minutes, 19 seconds mitigate that impact of occupancy through our ADR but as I mentioned in April we have seen the pace come back to 20:27 20 minutes, 27 seconds same time last year levels but we definitely expect maybe a high singledigit or early double digit growth in the terms in the month of April. 20:36 20 minutes, 36 seconds Okay. So, so we are saying that the um high singledigit repar growth in the month of April which which which in a way is a good outcome compared to March. 20:47 20 minutes, 47 seconds But V just to add May and June will be very exceptional good performance month for us and for the quarter we will do a double date growth in red and also V for 20:56 20 minutes, 56 seconds context if you look at it the only segment for us that was impacted was international and H1 typically if you lock talk over the next next six months 21:05 21 minutes, 5 seconds is almost onethird of H2 you know in terms of the impact that it has on our overall business plan. Yeah. So 21:13 21 minutes, 13 seconds typically in that sense yeah and international contribution also would be lower for you in this quarter right given the uh weather. 21:23 21 minutes, 23 seconds So it's dropped from a 50% share to around 40 odd% share where domestic has risen to approximately 60. 21:31 21 minutes, 31 seconds Right. Right. Uh secondly team could you share the management fees number for the quarter and the year? 21:39 21 minutes, 39 seconds So the management fees for the quarter uh for the full year we have done applause management fees of 21:48 21 minutes, 48 seconds 35 crores we have done and we are looking to for the next year we'll have a growth again because our managed hotels will have ramped up um so we will 21:58 21 minutes, 58 seconds be doing around there will be a improvement in the whole management fees because the Hyderabad 22:05 22 minutes, 5 seconds portfolio Hyderabad hotel has ramped up to almost 65% occupancy Even the managed hotels the key hotels are doing well. So 22:13 22 minutes, 13 seconds that will have a double digit growth in our management fees as well moving forward. 22:19 22 minutes, 19 seconds Okay, welcome back in the queue. 22:23 22 minutes, 23 seconds Thank you. The next question comes from the line of Karan from Ambbit Capital. Please go ahead. 22:30 22 minutes, 30 seconds Yeah. Hi, thanks for the opportunity. Uh just a couple of questions from my side. 22:34 22 minutes, 34 seconds Uh firstly, have you seen any meaningful cancellations or postponements in mice events due to the evolving geopolitical 22:42 22 minutes, 42 seconds environment and are these events getting deferred into upcoming quarters or being lost altogether? 22:48 22 minutes, 48 seconds So Karan thanks great question. Uh we we obviously had cancellations and my events that were booked across the portfolio in the month of March because 22:57 22 minutes, 57 seconds of all the geopolitical tensions. What we did we have given them credit notes and deferred them between the next six to nine months. So we expect many of 23:06 23 minutes, 6 seconds them a very high percentage of them coming back to us in the next few quarters. 23:12 23 minutes, 12 seconds Sure. And then secondly on the Korg acquisition how has been the initial response and when you say 170 crores of stabilized revenue are you also what 23:21 23 minutes, 21 seconds kind of ARS are you penciling in for that number and also does that include the 19 VA expansion in phase one 23:29 23 minutes, 29 seconds so K current just to take you back is like we have recently acquired K on 18th of March as you know so right now our focus is to whilst the real estate is 23:37 23 minutes, 37 seconds amazing and the asset quality is extremely good it's fully built up on Leela standards with a with a 7 acre lake and and an all villa property. 23:45 23 minutes, 45 seconds Right now there's a lot of work happening, a lot of training happening in terms of soft aspects, something that is known for. This is our first foray 23:53 23 minutes, 53 seconds into a forest century experiential destination product. Hence we are very very excited about it. The these are 24:00 24 minutes right now simulations and early guest feedback has been very very positive on the asset and we are we have not rebranded it yet. There's a site visit 24:09 24 minutes, 9 seconds and evaluation happening as we as we progress and we are looking forward to rebranded at the end of this quarter or early next quarter as a full-fledged 24:19 24 minutes, 19 seconds Leela forest century and that is when we expect all our distribution to start kicking in and with all the Leela you know you know in terms of loyalty 24:28 24 minutes, 28 seconds programs and you know key customers and all of that the initial response and the guest feedback has been very very encouraging although it's not yet to be 24:36 24 minutes, 36 seconds rebranded several touch points and experiential which are catering to the next generation travelers, mice, 24:43 24 minutes, 43 seconds wellness seeking travelers and even people who are seeking longer itineraries to experience the entire ecosystem in the destination. This is 24:51 24 minutes, 51 seconds the kind of funnel that we already building up going forward. And to your specific question in terms of expansion, we will once we open hotel and 25:00 25 minutes stabilize, we'll definitely evaluate because just to remind you only 20 acres out of the 76 acres has been used right 25:07 25 minutes, 7 seconds now. So we definitely see an opportunity to do that but we'll we'll come back to you at the right time because right now we our focus is to open it on brand and open it soon as the rehab for a century. 25:19 25 minutes, 19 seconds Sure. And last question to you Ravi for Aayodja Agrandamore we now looking at CY28 instead of FI28. 25:26 25 minutes, 26 seconds So is there a slight delay here and also if you could talk a bit about the cost implantation that you might be seeing in terms of construction cost uh and then 25:34 25 minutes, 34 seconds how are you looking at the capex number for FI27. 25:38 25 minutes, 38 seconds So just to answer in terms of these three hotels we have just you know put cy basis one or two quarters of construction risk always moves because 25:47 25 minutes, 47 seconds of the approval when you open the hotel but we are the all the approvals of all these three hotels are already in place the funding is already in place the 25:54 25 minutes, 54 seconds construction have started so that's the reason we have you know it's all on pace uh the cex numbers for these hotels remains the same there's no escalation 26:03 26 minutes, 3 seconds in the cost b so numbers remains the same great Thanks. Thank all the best. 26:12 26 minutes, 12 seconds Thank you. 26:14 26 minutes, 14 seconds The next question comes from the line of Deepak Saha from Ashika Institution Equities. Please go ahead. 26:22 26 minutes, 22 seconds Hi uh thanks for the opportunity. So first question is if you can highlight I mean overall revenue growth uh you know mid double digit and repa growth 6%. So 26:31 26 minutes, 31 seconds uh the faster element of growth is coming from FNV or or management fees for the quarter. 26:38 26 minutes, 38 seconds So you know FNB also contributes 40% of the hotel revenue. If you see our FNB bank would grow by more than 10%. FNV is 26:46 26 minutes, 46 seconds close to a double digited growth. And even our managed hotel income has also improved with Hyderabad property ramping 26:53 26 minutes, 53 seconds up uh to the full potential of almost 63% and ADI growth almost 1.2x 2x of the of the market and we have also got 27:01 27 minutes, 1 second additional you know HMA fees from our hotels because of the contractual of contract terms that we have as a result 27:08 27 minutes, 8 seconds we have been able to get a double digit revenue growth okay just just to follow up on that so then in the SMB growth side um the non- 27:18 27 minutes, 18 seconds guest uh footfalls are higher I mean are quite uh significant uh in alignment with what we saw last quarter 27:25 27 minutes, 25 seconds yes our non-resident covers have increased by almost 9 to 10% for the quarter and for the full year they have almost grown by 12%. So and our focus 27:33 27 minutes, 33 seconds continues in driving both uh non-resident covers and growing our in in-house capture ratio. 27:39 27 minutes, 39 seconds See Mr. Shah sorry I just like to add something to what Ravi mentioned if you recolct in every quarter we have been saying that 27:46 27 minutes, 46 seconds Leela our biggest differentiator is the luxury ecosystem we give as much importance to food and beverage experiences and dining programs as we do 27:55 27 minutes, 55 seconds to the rest of our business. FNB is nearly 40% of our business which has grown by 15% as Ravi mentioned and a very high percentage of non-resident 28:04 28 minutes, 4 seconds food falls across all our events and spaces and and restaurants. 28:11 28 minutes, 11 seconds Got it. That that's helpful. So one last question um on the Dubai side I know it's uh very early and uh dependent on 28:18 28 minutes, 18 seconds lot of things beyond our control but just from taking over that particular property do we have any um you know 28:25 28 minutes, 25 seconds plans in terms of fast forwarding or delaying what's what's the status there in terms of uh taking it over uh and and 28:32 28 minutes, 32 seconds upgrading it to a Leela brand is there any change compared to where we were earlier no change in our plans firstly I'd like 28:40 28 minutes, 40 seconds to just remind everyone that everyone is safe on the ground and my physical asset has not been impacted at all. It's also worth noting that we are 25% shareholder 28:49 28 minutes, 49 seconds there and impact to our larger business plan is minimal. Uh we are also fortunate to have a strong capital partner in Brookfield who's the 28:56 28 minutes, 56 seconds remaining 75% owner. So none of our plans have been impacted because of this geopolitical events. Uh it's very hard to predict how these events will pan out 29:04 29 minutes, 4 seconds in the future and what the recovery will look like. But one thing we are very clear about is that the new supply in Dubai is going to be very muted in the 29:12 29 minutes, 12 seconds near and long term which will eventually create a very positive fundamental in the long run. I'm sure you have seen a lot of headlines in the market regarding 29:19 29 minutes, 19 seconds hotels shutting down in Dubai or refurbishments in the near term and long term. While our hotel continues to remain operational and we are focused on 29:27 29 minutes, 27 seconds breaking even operationally at this stage, there could be an opportunity for us to take a larger market share when the market recovers. Anyway, our plan is 29:36 29 minutes, 36 seconds to start a refurbishment work. This was our original plan as well by the end of this calendar year which we would then accelerate and reopen and launch the property in 2028 under the Leela brand. 29:48 29 minutes, 48 seconds By this time we are hopeful I mean we talking of like significant 12 to 15 months from now that we are hopeful that this market would have seen a recovery. 29:56 29 minutes, 56 seconds regarding residential sales which was a part of our business plan. We had budgeted sufficient time to execute the sales over the next two three years. 30:06 30 minutes, 6 seconds Right. Thank you. That's really helpful and all the best for 5.7. Thank you. 30:11 30 minutes, 11 seconds Thank you. The next question comes from the line of Girish Chri from Aendas Park. Please go ahead. 30:19 30 minutes, 19 seconds Yeah. Hi. Uh good evening. Uh thanks for the opportunity. Um firstly on code um uh I mean uh regarding your assumptions 30:27 30 minutes, 27 seconds of 165 to 175 cr stabilized revenues uh when do you think uh this can be achieved in year 1 or year two and as a 30:37 30 minutes, 37 seconds followup for the 19 villas which are expected to come up any any capeex number and when when will that be spent? 30:46 30 minutes, 46 seconds So the 165 kores of revenue numbers includes the 19 villas that we had planned for phase 2. This number will be achieved in the year four when those 19 30:55 30 minutes, 55 seconds villas will also come into play. Uh the capex that we have planned for those additional villas around around 21 kores 31:02 31 minutes, 2 seconds that we would spend to make those uh 19 vas. 31:09 31 minutes, 9 seconds Okay. And uh just on the occupancies um how should we look at for fiscal 27 the 31:17 31 minutes, 17 seconds blended occupancies for the year fiscal 26 were 69%. So how should we see between your uh city properties and the 31:25 31 minutes, 25 seconds resorts for fiscal 26 we saw a meaningful improvement in occupancies for resort properties. So how should we see for fi 27? 31:34 31 minutes, 34 seconds So occupancy for FI27 will be in early '7s uh for sure and the city hotels will do in mid70s and there's a lot to do in you know mid60s to late60s. 31:46 31 minutes, 46 seconds Got it. Thank you. 31:50 31 minutes, 50 seconds Thank you. The next question comes from the line of Akash from Nora Holdings. Please go ahead. 32:00 32 minutes Hi, am I audible? Yes. Yes. Saf. 32:04 32 minutes, 4 seconds Yeah. Hi. Uh, congratulations on great performance, sir. Uh, just to uh run again on the 4Q FI26 numbers. I think 32:12 32 minutes, 12 seconds this time uh room and FNB revenue numbers were not penned down uh were not penned down in the PPT. Could 32:21 32 minutes, 21 seconds we just get the exact room and FnB revenue for 4Q FI26 room FNB and HMA please? 32:34 32 minutes, 34 seconds So you know maybe we can collect on a separate call to view deep time numbers on the rooms and FNB and HMA but uh what we had spoken earlier that rooms grew by 32:44 32 minutes, 44 seconds you know for the quarter four by almost 6% FNB grew by almost uh double digit numbers and HM other income also grew by uh double digit numbers. 32:55 32 minutes, 55 seconds Understood. and uh how much would the how much revenue would we get from the Corg acquisition in FY27? 33:05 33 minutes, 5 seconds What kind of topline are we seeing from that hotel specifically? 33:09 33 minutes, 9 seconds So this will be our first operating year uh where we are work right now working on the the rebanding process and we'll 33:16 33 minutes, 16 seconds be doing the occupancy uh you know in early 40 and for the first full year we'll do somewhere around 33:26 33 minutes, 26 seconds 65 to 70 K will be the first year of revenue and uh very healthy margins we'll do as we do in our VA portfolio 33:34 33 minutes, 34 seconds there almost 505 5% which we do for other resort hotels in our portfolio. 33:43 33 minutes, 43 seconds Understood. Uh that's all the question I had. Thank you. 33:48 33 minutes, 48 seconds Thank you. The next question comes from the line of Abai Kaitan from Access Capital. Please go ahead. 33:56 33 minutes, 56 seconds Yeah, thank you for the opportunity. uh so firstly u on the 4Q performance if you can help uh break the ref bar growth 34:05 34 minutes, 5 seconds of 6% in city hotels and resort hotels and also for April uh as you mentioned that the growth is actually tracking for 34:14 34 minutes, 14 seconds single digit growth so there also are we seeing like a broad-based growth across city of resort or is this one segment better than the other 34:26 34 minutes, 26 seconds if talk about the occupancy where you know we did an occupancy you know growth so at quarter for FI 26 we were 72% uh 34:36 34 minutes, 36 seconds last year we did 78 that was 6% that is mainly because of the war impact if the war cancellation would not happen we would have done similar occupancy a little more than what we did for quarter 34:44 34 minutes, 44 seconds 4 fi25 but if you look at the ADR ADR grew by almost 15% from 27,000 we went to 32,000 as a result the f was 6% 34:54 34 minutes, 54 seconds because of the occupancy drop and we occupy has dropped in a city hotels which had a larger share of international business. So I just want 35:02 35 minutes, 2 seconds to reiterate that the only subsegment of demand that that got impacted because of the war was the our international 35:10 35 minutes, 10 seconds business from of key source markets but we see that that dampening as we go forward and we see that not reflecting in the future pace of bookings. Our 35:18 35 minutes, 18 seconds resorts were insulated and resorts continue to uh like Ravi mentioned earlier May and June we see a very strong rebound happening in resorts and 35:27 35 minutes, 27 seconds even in April we see that you know it getting the this compression getting offset even in our city hotels. 35:35 35 minutes, 35 seconds Understood. Uh that is very helpful. My second question is again follow up on what you mentioned right now. So given that uh if the uh the international uh 35:43 35 minutes, 43 seconds travelers are sort of offset by higher domestic uh do we see some risk to other revenues or the FNB revenues and 35:51 35 minutes, 51 seconds therefore on the margin side or do we expect that to remain in the same y not really what we have seen in the last few years especially at the leela we can 36:00 36 minutes talk with confidence bases are last eight quarters that our domestic travelers travel as much they stay as 36:07 36 minutes, 7 seconds long why the international business has a larger longer length of stay because typically if you come from longhaul 36:14 36 minutes, 14 seconds markets like the US you would probably stay for three and a half to four nights where the average domestic traveler would stay for two two and a half nights 36:21 36 minutes, 21 seconds but the spending on FNV the spending on SC revenue is the same and but you know going back given the brand love and the 36:28 36 minutes, 28 seconds recall that we have in international markets Leela has always been voted as one of the finest luxury brands in the 36:35 36 minutes, 35 seconds world consistently by the users and the customers We expect when the international business starts coming back to its normal state we'll be the 36:44 36 minutes, 44 seconds first to pick up and bounce from there which adds us gives us another layer of opportunity and also if you see a non-resident 36:52 36 minutes, 52 seconds covers those are growing almost 12% by y that also helps in driving our fn revenue even if you have a slightly 36:59 36 minutes, 59 seconds lower international mix that is very helpful thank you 37:06 37 minutes, 6 seconds thank you the next question comes from the sign of Vibbove Mule from Highong India Securities. Please go ahead. 37:17 37 minutes, 17 seconds Hi sir. Uh thanks for the opportunity and uh congratulations on a strong set of numbers especially in a weak demand period. Uh my first question was on our 37:25 37 minutes, 25 seconds revenue growth. We uh reported revar growth of 6% while revenue has grown by 14% yearon year. uh I just wanted to 37:33 37 minutes, 33 seconds understand the bridge between the room revenue growing by 6% FNB growing by 9 to 10%. Uh while HMA again is uh as you said would be in the low double digits. 37:45 37 minutes, 45 seconds So uh have we seen additional delta coming in from Kurug Resort which is pretty significant and uh is there also 37:53 37 minutes, 53 seconds uh delta that's coming in from our uh commercial uh leased uh area Bangalore property. 38:01 38 minutes, 1 second So we already explained uh you know the rational for the increase in the double digit number. uh if you look at the room 38:09 38 minutes, 9 seconds revenue growth hasn't only impacted by 6% occupancy track due to the war FNB contributes 40% of the total hotel 38:17 38 minutes, 17 seconds revenue which grow by double digit we have also seen the HMA fees grow double digit in some of our managed properties based on a management contract and ramp 38:24 38 minutes, 24 seconds up of recently open hotel like Hyderabad also we have seen a strong growth in HMA fees in this quart and expect this 38:31 38 minutes, 31 seconds trajetory to continue this is on the back of the ramp up in our performance across several managed properties along with the ability to charge higher 38:39 38 minutes, 39 seconds fees in some cases where we invested key money in the past. 38:44 38 minutes, 44 seconds Understood sir. And uh secondly on Dubai asset uh for Palm Jim Resort uh since 38:51 38 minutes, 51 seconds current environment is uncertain and uh we have seen real estate prices plummeting in Dubai market itself. uh is 38:59 38 minutes, 59 seconds there a possibility that we may have to take any sort of write offs on our investment in Dubai in the near term if the situation persists for a longer period. Is that a possibility? 39:08 39 minutes, 8 seconds Uh we are evaluating the situation but we don't see any such possibility and as we had uh said that the basis on which 39:16 39 minutes, 16 seconds we had underwritten this asset in terms of our real estate pricing was very conservative and it's too early for us to say how this situation will pan out 39:24 39 minutes, 24 seconds and we'll we'll evaluate it. uh we are very very strong asset management focus and we'll keep everybody posted as the 39:31 39 minutes, 31 seconds situation and the market evolves. We evaluating the situation literally every day and we'll block and tackle as required. 39:39 39 minutes, 39 seconds Understood sir. And lastly on the weddings portion uh did we see any benefit in March uh in terms of shift 39:47 39 minutes, 47 seconds from uh some of the weddings which were planned outside India uh which got shifted into domestic leisure markets 39:54 39 minutes, 54 seconds and uh going forward in Q1 and Q2 as well do you expect more traction coming in for from weddings? 40:01 40 minutes, 1 second So yes uh that's correct. There were some of the wedding that were booked in the maj. We were able to take uh three of such weddings in our hotels in the 40:10 40 minutes, 10 seconds month of March and there are queries also in the month of April and May for for some of such weddings which uh will also help to drive incremental revenue on the wedding segment. 40:20 40 minutes, 20 seconds Understood sir. Thank you so much and all the best. Thank you. 40:26 40 minutes, 26 seconds Thank you. The next question comes from the line of Archel Kumar from HSBC bank. 40:32 40 minutes, 32 seconds Please go ahead. Uh yeah. Hi uh thanks for the opportunity. 40:37 40 minutes, 37 seconds Um first of all um I wanted to um um move away from revenue and just want to understand about the cost. So basically 40:45 40 minutes, 45 seconds in this Q4 I think most of the cost were sort of quite inflicted. So 40:52 40 minutes, 52 seconds sorry Archel you're not clear. Can you repeat that? 41:00 41 minutes A please unmute your line in case if you are on mute. 41:12 41 minutes, 12 seconds Since there is no response from the participant, we will move to the next participant that is Karan Kamal from Choice Institutional Equities. Please go 41:20 41 minutes, 20 seconds ahead. Hello sir. Uh so I had a question on the cost only. Uh now that uh we are facing some disruption in the Dubai 41:29 41 minutes, 29 seconds property are we expecting any cost overrun to impact margins or will that not be a huge cost overrun for us? 41:37 41 minutes, 37 seconds It will not be a huge any cost impact for us anyway you know the the operator who has managed the hotel will continue 41:44 41 minutes, 44 seconds to manage till end of this year and our plan was that we'll get the handover on 1st January 2027 and we'll ref the hotel 41:52 41 minutes, 52 seconds by end of this year and rebrand January 2028. the plan remains the same and there's no cost over on that front. 41:58 41 minutes, 58 seconds Okay, great. Uh sir, uh secondly, uh can you maybe detail out what plans we have for the ARQ uh ARQ franchise and what is 42:07 42 minutes, 7 seconds sort of our revenue model? Are we sort of going for a membership model and what are revenue expectations there for 2728 maybe? 42:16 42 minutes, 16 seconds Uh thank you for the question. I mean uh ARK is really a great milestone achievement in our asset portfolio. We 42:24 42 minutes, 24 seconds opened the first club in Paris, Bangalore uh in the last financial year which is FY26 and we are opening two 42:32 42 minutes, 32 seconds clubs in this financial year. One in this quarter itself in Dila Palace, New Delhi and the second one in Chennai. Uh 42:39 42 minutes, 39 seconds these are great membersonly club and very rarified spaces for which create a compounding impact for the rest of our business and gives us access to lifetime access to Ultra HNI and HNI customers. 42:52 42 minutes, 52 seconds There is an initiation fee model for which a member has to pay and membership is only by invite. So they have to pay an initiation fee and then there's a run 43:00 43 minutes rate fee mod run rate fee that they have to pay every year. The memberships are currently either for 10 years or or for lifetime. uh this is what we doing for 43:08 43 minutes, 8 seconds our founding members and eventually as we grow we'll also uh evaluate other membership models so that we can you know whilst we are being very very 43:17 43 minutes, 17 seconds relevant when it comes to the quality of the real estate and the privileges and programming and then we can scale up to have the larger share of memberships there. 43:27 43 minutes, 27 seconds Got it sir. any any idea on what kind of number are you targeting is not the revenue number but what kind of uh membership number are you targeting? 43:38 43 minutes, 38 seconds See the current the current initiation fee is 45 lakhs plus GST. Uh as I said this is only through invite. We have a waiting list and a funnel uh of 43:47 43 minutes, 47 seconds memberships across the all the major metros we are meeting them. our overall goal on stabilization and once we have 43:55 43 minutes, 55 seconds all the clubs open and let me also tell you in addition to Bangalore, Chennai and New Delhi, we are also looking for the club in Mumbai as well and this has also come on the feedback of our guests. 44:06 44 minutes, 6 seconds We are looking at an overall stabilized number of 2,000 members because at that number we feel is the right fit where we can serve them, take care of them and 44:14 44 minutes, 14 seconds give them that kind of a luxury experience that they have paid for. Good. Thank you so much sir. Thank you. 44:23 44 minutes, 23 seconds Thank you ladies and gentlemen. Due to time constraints, we will take the last question from Vinamra Hiat from Jeffre. 44:33 44 minutes, 33 seconds Please go ahead. Hi sir, am I audible? Yes. Yes. Yes. 44:39 44 minutes, 39 seconds So congrats on a good um third. Vinra, you're not audible now. 44:47 44 minutes, 47 seconds 1.8 rate versus um FI25 and 26 block whereas last year this was 2.5%. Um is 44:55 44 minutes, 55 seconds there a reason for this and do we see any spike in this going forward? 45:01 45 minutes, 1 second So the net toa is 1.6x as of FI26 and we expect a similar you know net to in the 45:09 45 minutes, 9 seconds next year as well. Uh and this would go down uh to a to 1x and even a lower number as we move forward. Sorry sir. Uh 45:16 45 minutes, 16 seconds I was talking about depreciation um not like that. 45:20 45 minutes, 20 seconds So depreciation uh will almost 100 k will remain in the same line in the next 2 three years only when we have the the 45:28 45 minutes, 28 seconds new hotels operating uh then only the depreciation numbers will start to increase marginally. 45:34 45 minutes, 34 seconds Okay. Okay. Thank you. 45:38 45 minutes, 38 seconds Thank you. The next question comes from the line of Archel Kumar from HSBC Bank. Please go ahead. 45:44 45 minutes, 44 seconds Yeah. Hi um sorry my line was disconnected. Um so um as I started um um I wanted to understand about the 45:52 45 minutes, 52 seconds costs. So basically if I look at all the cost um you know all looks inflated. So for example your employee cost FNB cost 46:00 46 minutes everything is as a percentage of revenue are significantly um above the Q4 last um last year. So what's the reason is it 46:08 46 minutes, 8 seconds like only only impact on on March revenue had such a big impact and then going forward um are you um thinking 46:16 46 minutes, 16 seconds about taking any steps to cut down your cost to product your margins. So uh so that's my first question if you could please give a bit of a color understanding on that. So we have a very 46:25 46 minutes, 25 seconds uh active asset management approach in cost management a very efficient cost structure most of our costs have just grown by inflation only there have been 46:33 46 minutes, 33 seconds cost increase in sales and marketing and sales commission uh for which I reason if you see the flow through has been 60% this industry leading flow through 46:41 46 minutes, 41 seconds margin even if you look at our IBIDA margin we are operating at a 49% IBIDA margin which is 167 dips better than 46:49 46 minutes, 49 seconds same time last year full year the only if you look at all the costs All the cost is a lower percentage to a G except 46:57 46 minutes, 57 seconds for marketing and commissions where obviously Expedia and Agoda started charging on a gross basis rather than a net basis. That was one of the main 47:05 47 minutes, 5 seconds reason and obviously our share of GHA revenue also increased and so was some commission on the sales side which has increased otherwise all other cost and 47:13 47 minutes, 13 seconds the percentage of revenue was uh is lower than what was last year. But but Ravi I mean if you see employee cost in 47:22 47 minutes, 22 seconds Q4 last year it was 15.9% in Q4 this year is 16.6%. 47:28 47 minutes, 28 seconds Similarly your other costs are up 77 70 bits. So I mean uh you know not only the marketing cost looks like all the costs have gone up. So that that's where I 47:36 47 minutes, 36 seconds wanted to understand um what the reason for that. I'll tell you in payroll obviously uh there has been a the whole 47:43 47 minutes, 43 seconds impact of uh taking acro on the uh for the G new labor code where we have taken impact on the both the leave in cash and 47:51 47 minutes, 51 seconds gratuitity that has been an exceptional item in the payroll cost that has come in uh other we have added few employees for the new value drivers that we have 47:58 47 minutes, 58 seconds added as a result of that cost this year you'll see the our value drivers firing in full cylinders and the revenue impact will come but those people have already 48:06 48 minutes, 6 seconds been hired for the simulation the training piece It was true that in fact by only 8 and a half%. 48:14 48 minutes, 14 seconds So should we should we expect these costs to go down as a percentage of revenue going forward? It should it should. 48:20 48 minutes, 20 seconds Okay. My second question is about the about the net debt to AIDA of course you you're at 1.6 which looks very comfortable going forward. How do you 48:29 48 minutes, 29 seconds see in FI27? Do you think stable? Do you think it's going down further? Or do you think because of capex coming through it could go up a bit? So what is your 48:36 48 minutes, 36 seconds color? any any any thoughts on that please? 48:39 48 minutes, 39 seconds So I'll tell you we obviously the debt will increase uh for the capex that we do for the pipeline asset but since our IBIDA will increase our net debt to IDA 48:47 48 minutes, 47 seconds will remain the similar levels of 1.66 and moving forward will come down to lower to 1.4 four and then come to closer to one. Obviously, if we do more 48:56 48 minutes, 56 seconds acquisition, then it will go a little higher. But once all these assets start, you know, generating Eida, it will come to a very comfortable level even below one. 49:05 49 minutes, 5 seconds Right. Okay. And my last question is um on your um um um on your comment regarding the city hotel versus resorts. 49:13 49 minutes, 13 seconds Um so um it would be great if you could give a bit of a color in terms of performance um arr and and occupancy uh 49:20 49 minutes, 20 seconds by different cities like Delhi, Bangalore and all that that'll be very helpful please. 49:26 49 minutes, 26 seconds So that we can connect separately and we can give you you know sure perfect thank you so much. 49:36 49 minutes, 36 seconds Thank you ladies and gentlemen. In the interest of time, that was the last question for today. For any further queries, please reach out to the 49:45 49 minutes, 45 seconds investor relations team at Leela. Thank you for joining us. You may now disconnect your