Royal Orchid Hotels posts impressive growth with consolidated revenue surging to Rs 155.98cr

Royal Orchid Hotels Limited, one of India’s fastest-growing hospitality chains, has reported robust financial results for the second quarter and first half of the financial year 2024-25. With a consolidated revenue of ₹155.98 crore for H1, the company continues to solidify its position as a leader in the hospitality sector. The results showcase the company’s ability to maintain consistent growth across its diverse portfolio, encompassing over 110 hotels across 75 locations.

Record-breaking financial performance

For the standalone business, the company achieved a revenue of ₹101.03 crore in H1 FY 24-25, a significant increase from ₹91.07 crore during the same period last year. EBITDA climbed to ₹29.64 crore, compared to ₹27.69 crore in H1 FY 23-24. Meanwhile, profit after tax (PAT) rose to ₹10.63 crore from ₹9.60 crore, with earnings per share (EPS) improving from ₹3.50 to ₹3.88.

On a consolidated basis, Q2 FY 24-25 recorded a revenue of ₹78.32 crore, a slight increase from ₹77.66 crore in Q1 FY 24-25. Despite a minor dip in PAT at ₹7.52 crore compared to ₹8.72 crore in the previous quarter, the company has shown resilience amidst increasing market challenges.

Chairman and Managing Director Chander K. Baljee expressed satisfaction with the results, attributing the growth to the company’s innovative strategies and strong customer loyalty. He emphasized the importance of the group’s new upscale brand, which is poised to drive additional growth with expected annual occupancy rates exceeding 75%.

Strategic initiatives driving growth

The introduction of the revamped loyalty program, ‘Regenta Rewards,’ has further strengthened Royal Orchid Hotels’ relationship with its customers. The program, described as a resounding success by the company, highlights its commitment to enhancing customer satisfaction and retention.

Additionally, the hospitality chain’s focus on launching an upscale brand underpins its strategy to tap into rising demand for premium accommodations. This move, combined with the company’s diversified offerings, positions it strongly for sustained growth.

Challenges and future outlook

The adoption of IND-AS 116 led to a notional increase in depreciation and finance costs amounting to ₹11.72 crore, resulting in a standalone PAT reduction of ₹2.41 crore. However, the management remains optimistic, citing the positive market sentiment and growing client preference for their brand.

Royal Orchid Hotels has also received numerous accolades for its contributions to the hospitality sector. CMD Chander Baljee was recently honored with a Lifetime Achievement Award, recognizing his visionary leadership and dedication to the industry.

Expert analysis: A promising trajectory

Industry experts believe Royal Orchid Hotels’ performance demonstrates the resilience of India’s hospitality sector amidst global economic uncertainties. The company’s focus on customer-centric strategies and premium offerings is expected to drive further growth.

The planned upscale brand launch is particularly significant, as it aligns with the rising demand for high-quality, affordable accommodations in India. By leveraging its diverse portfolio and loyal customer base, the company is well-positioned to capitalize on emerging opportunities in the market.