INDHOTEL Q2 FY27 Earnings Call: Raises FY27 Revenue Guidance to 15-17%, 18th Consecutive Record Quarter

INDHOTEL held its Q2 FY27 earnings call on October 21, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

18th Consecutive Record Quarter; Standalone Margin Up 400 bps

• Consolidated operating revenue of Rs.2,484 crore (+22% YoY) — Q2 FY 2026-2027 marked the 18th consecutive record quarter; operating EBITDA of Rs.706 crore (+24% YoY) at a 28.4% margin (+50 bps) and PAT of Rs.349 crore (+23% YoY).
• Standalone outperformance — standalone operating revenue of Rs.1,336 crore (+26% YoY) and EBITDA of Rs.520 crore (+40% YoY) at a 38.9% margin (+400 bps), with standalone PAT margin at 27%; the CFO attributed the 400 bps expansion to operating leverage, MICE activity and revenue mix, with no one-off items.
• Hotel segment revenue and EBITDA grew 25% and 30% YoY — management cited double-digit CAGRs across revenue, EBITDA and PAT over the past five years, with current growth running ahead of that five-year CAGR.
• RevPAR growth was double-digit across all brands — standalone RevPAR +28% and consolidated domestic hotels RevPAR +25% YoY; occupancy rose to 82% from 75% in Q2 FY 2025-2026, with growth balanced between occupancy and ARR (occupancy up ~6-7% on both standalone and domestic consolidated bases).
• Taj Palace New Delhi room revenue grew 132% YoY — crossed Rs.100 crore in monthly revenue for the first time in September 2026 at a very high GOP margin, reflecting pricing power from FY 2025-2026 upgrades (President Mumbai, Taj Westin Bengaluru, Taj Fort Aguada Goa, Taj Lake Palace Udaipur); momentum expected to continue through H2 FY 2026-2027.
• Headwind: West Asia geopolitical tensions — elevated fuel prices reduced airline capacity and raised airfares, moderating international/long-haul travel demand; domestic demand stayed resilient, supported by large MICE events (e.g., BRICS Summit).

FY27 Guidance Raised 300 bps; FY28 Affirmed as Better

• FY 2026-2027 consolidated revenue growth guidance raised to 15–17% — upgraded from the previously communicated 12–14% (a 300 bps upgrade); hotel segment revenue guided to grow 17–19% in FY 2026-2027; guidance excludes revenues from the pending Oriental Hotels (OHL) merger.
• Implied H2 FY 2026-2027 pace needs to be higher than ~14% — CFO Ankur Dalwani said the 2H pace needed to meet the 15-17% guidance is "probably going to be higher" than the ~14% implied by Ambit's math (1H growth ~18% vs 16% midpoint), citing a seasonally strong Q3 FY 2026-2027 and a high Q4 FY 2025-2026 base; Ambit argued there is upside risk since base quarters included Indigo flight cancellations (December, Q3 FY 2025-2026) and the West Asia crisis (March, Q4 FY 2025-2026).
• CEO Puneet Chhatwal categorically affirmed FY28 will be better than FY27 — "mathematically it's not possible that we don't do better than this year," with the only caveat being exogenous shocks such as war or pandemic; international business recovery is cited as an FY28 driver but kept aspirational ("hopefully recovering"), not a commitment.
• 50 hotels added in FY 2026-2027, another 50-70 expected online in FY 2027-2028 — management noted none of this pipeline is at risk; UBS framed FY28 drivers as more weddings, TajSats in the base, Oriental adding to growth and more signings, which management endorsed qualitatively.
• Margin outlook is directional only — management guided to a "positive outlook on margin" without numeric guidance and did not endorse an analyst's 2–3% forward margin-expansion assumption (period unspecified); the CFO said quarterly margin expansion will vary between 1% and 4% (period unspecified).
• Seasonality will not fully flatten — management does not expect H1 to become equal to H2; H2 should remain seasonally stronger, aided by the holiday season, and H2 FY 2026-2027 has a good amount of wedding days.

MICE Framed as Structural; FY28 Wedding Calendar a Tailwind

• MICE share of mix rose YoY in H1 FY 2026-2027 — Q2 FY 2026-2027 MICE growth was "much faster"; CFO Ankur Dalwani called MICE a "structural story" as India's event-holding infrastructure expands, and events (BRICS Summit, AI Conference, Bloomberg Summit) are recurring contributors.
• Delhi ADR grew ~50% in Q2 FY 2026-2027 — aided by a series of events in Delhi and Mumbai; management said even adjusting for the event benefit, Delhi would have delivered late-20s% growth; standalone RevPAR growth would still have been "a comfortable double-digit number" excluding the BRICS Summit.
• FY 2027-2028 wedding calendar features ~95 wedding nights vs a normal 60-65 — management said this is "definitely going to be a tailwind" for social MICE in FY 2027-2028; H2 FY 2026-2027 (particularly Q4) has more wedding nights than Q4 FY 2025-2026; Jefferies noted the calendar extends beyond Q4 into Q1 and throughout CY27.
• Event pipeline cited — heads-of-state visits (week of the call), Bloomberg New Energy event in Delhi, a fintech event in Q1 FY 2026-2027, and upcoming biennial Aero Show in Bangalore and Vibrant Gujarat; management says IHCL is positioned to capture "more than our fair share" of the event economy.
• Double-digit growth across markets in Q2 FY 2026-2027 — many cities at high-teens to early-20s%; management declined to generalize beyond top-10 cities ("every micro market is going to be different"); JP Morgan's Emin Pirani concurred that effective supply in large micro-markets is tighter than headline aggregates suggest.
• Demand-supply balance "continues to be in favor" — domestic strength framed as a structural shift in Indian consumption ("for now"), not a temporary substitution of deferred international travel; branded hotel supply in India is minuscule relative to potential, pegged by different reports at roughly 40,000 keys.

Fee Run-Rate Above Guidance; Depreciation and TajSats Pressure

• Management fee run-rate of 25% in Q2 FY 2026-2027 — above the standing "high teens" (15-20%) guidance (guidance period unspecified); fee income of Rs.156 crore vs Rs.125 crore in Q2 FY 2025-2026 (+25%), driven by a 25% increase in managed room inventory, higher RevPAR, technical fees and new brand-fee streams; CEO said guidance may be revised by end of Q3 FY 2026-2027.
• Rs.1,000 crore fee income target within 2 years from today (≈ FY 2028-2029) — CFO said management would be "disappointed" if fee income doesn't cross that mark; guidance to open 5,000 keys every year reiterated (annual guidance; no specific FY); fee guidance to be sharpened by end of Q3 FY 2026-2027. Brand fees from branded villas/residences are volatile — Ras Al Khaimah fees stopped after the West Asia crisis.
• Consolidated depreciation grew ~20% YoY — vs the 34% non-standalone jump (≈ Rs.27 crore) flagged by Elara Capital's Prashant Biyani; CFO attributed growth to new assets from acquisitions (Frankfurt, Noida, TajSats) onboarded early FY 2026-2027; excluding them, normalized growth would have been 8-9% in Q2 FY 2026-2027.
• TajSats EBITDA declined sequentially from Q1 to Q2 FY 2026-2027 — airline schedule curtailments announced primarily in June (Q1 FY 2026-2027) amid the West Asia geopolitical crisis hit airline catering; non-aviation diversification preserved top-line growth at a lower margin; FY 2026-2027 characterized as a "year of consolidation" for TajSats, with improvement expected in H2 FY 2026-2027. Management has no control over further war-front developments in West Asia.
• Reported margins have absorbed stabilization costs, IT spends and regulatory changes — new provident fund rules and implementation of the code of wages, per management; Q2 FY 2026-2027 absorbed a normal payroll increase.
• Consolidated margins at 35% in Q2 FY 2026-2027 described as industry-leading — even versus other international brands; much of the operating leverage is coming through asset-management initiatives in company-owned assets.

670 Hotels; OHL Merger and Integration Roadmap

• 47 hotels signed and 20 opened in H1 FY 2026-2027 — portfolio reached 670 hotels with 69,000+ keys in operation or under development (as of Q2 FY 2026-2027); CEO said the portfolio crossed 675 hotels as of end-September 2026 with 392 open as of the call date and 4 more planned in the remainder of October 2026.
• 400-hotel milestone targeted for November 2026 or by end-Q3 FY 2026-2027 — of the 34,800+-key pipeline, 94% is capital-light (81% management contracts, 13% capital-light leases); management will revert to investors by mid-November 2026 with revised development guidance and on the Accelerate 2030 700-hotel portfolio target, which it expects to reach before end of FY 2026-2027, after which the target will be reset.
• OHL all-stock merger announced in Q2 FY 2026-2027 at 25 IHCL shares per 117 OHL shares — expected to drive 6–7% upside in standalone operating revenue in FY 2027-2028; not expected to come into force before 1 April 2027, appointed date 1 April 2027, scheme filed with the stock exchanges; OHL acquisition expected to close in FY 2027-2028 with key synergy in proactive asset management.
• Clarks integration with Ginger: ~75 signings completed as of Q2 FY 2026-2027 — 30 properties already on board as Ginger; management expects the integration to lift quality, customer experience, RevPAR and margin profile in FY 2027-2028; dedicated task forces review progress monthly against targets set at the beginning of FY 2026-2027.
• Vrej Hospitality and Atmantan acquisitions (closed early FY 2026-2027) performed well — Atmantan (integrated wellness) has been integrated with IHCL's marketing and sales efforts, supporting H1 FY 2026-2027 business, with further benefits expected through H2 FY 2026-2027 and into FY 2027-2028.

US Assets Improving; London Renovation Drag; FTA Upside Hoped

• London margin declined 360 bps YoY in 1H FY 2026-2027 — attributed to delayed renovation works (meeting rooms, lobby, new bar, cigar lounge, whiskey lounge) amid supply-chain disruption, now completed; London is seeing a double-digit revenue increase in October 2026 (Q3 FY 2026-2027); London and US were also hit on the cost side by the West Asia crisis (fuel and power), and a London property tax waiver was removed in Q2 FY 2026-2027.
• US asset "Pier" (Fifth Avenue) is at positive EBITDA margin with no cash losses in Q2 FY 2026-2027 — FY 2026-2027 EBITDA margin expected to exceed the positive margin achieved in FY 2025-2026; management does not expect the asset to deliver 20-25% EBITDA margins (period unspecified), viewing it partly as a marketing expense.
• San Francisco market is almost 90% back to its level of 3-4 years ago — management expects it to go beyond 100 to 105-110 post the JP Morgan conference in January (Q4 FY 2026-2027); international margins will structurally remain below India due to higher labor costs and the absence of India-style wedding/F&B footfalls.
• Foreign tourist arrivals grew at a 3.9% CAGR over the last 10 years vs ~11% for domestic — CEO noted domestic will remain the stronger pillar; foreign guest room nights sold in Q2 FY 2026-2027 were roughly flat YoY, though revenue contribution was higher on greater foreign guest spend.
• WTTC global summit scheduled in India in FY 2027-2028 — the CEO "hopes WTTC-led marketing (starting within a few months) could drive much larger FTA growth over the next 12 months," calling it a "hidden upside" as India's FTAs lag even Albania and Croatia; management sees FTAs needing to grow toward a 5-6% CAGR vs the historical 3.9% (period unspecified).
• Tier 2/3 city capacity could grow ~12% CAGR over ~5-6 years — per a recent industry report cited on a company slide, spanning ~300 cities at ~500 keys per city; tier 2/3 markets are pacing at 15-20% room-night demand growth in FY 2026-2027, largely met by unorganized supply, with a shift to quality branded supply already underway. Management flagged that Indian project execution timelines often slip.