Apeejay Surrendra Park Hotels reported strong performance in Q1 FY27, with operating revenue up 8% year-on-year to ₹167 crores and EBITDA rising 3% to ₹47 crores. The company detailed its strategic expansion plans, aiming for over 6,000 keys by FY 2030, and highlighted positive momentum in its F&B and lifestyle segments, including the Flurys brand. Management also discussed operational efficiency improvements and market stabilization post-disruptions.
Apeejay Surrendra Park Hotels: Q1 FY27 Earnings Call
Financial Performance in Q1 FY27
Apeejay Surrendra Park Hotels commenced FY27 with a robust performance, demonstrating resilience in its business model. The company reported operating revenue of ₹167 crores in Q1 FY27, marking an 8% year-on-year growth. EBITDA stood at ₹47 crores, an increase of 3% year-on-year, with an EBITDA margin of 28.12%. On a consolidated level, revenue reached ₹172 crores (up 10%) and EBITDA was ₹52 crores (up 8%). Profit After Tax (PAT) for the quarter was approximately ₹12 crores, a decline of 14% year-on-year, attributed to higher finance costs for expansion and a deferred tax provision related to shifting to a new tax regime. The debt-to-equity ratio remains favorable at 0.12, with net debt-to-EBITDA at 0.70.
Strategic Growth and Expansion Initiatives
The company outlined ambitious growth strategies, including an objective to build a scalable hospitality platform with over 6,000 keys by FY 2030. This expansion will focus on select attractive markets, with an emphasis on managed properties and asset-light formats.APEejay Surrendra Park Hotels is looking at doubling its hotel portfolio from 42 hotels with 2,667 keys to 87 hotels totaling 6,719 keys over the next four years. The Flurys brand is also slated for significant expansion, targeting 400 outlets by 2030. Several projects are in development, including mixed-use developments and new hotel openings across various cities.
Operational Highlights and Market Outlook
Despite headwinds from geopolitical events and subdued air traffic growth, the company maintained a leading occupancy position of 92% and outperformed the market in RevPAR. Management noted stabilization in the market and anticipated improved Average Daily Rates (ADR) due to upcoming conferences, conventions, and the wedding season. The company is also enhancing operational efficiency with the implementation of SAP S4 HANA for Finance. Apeejay Surrendra Park Hotels expressed confidence in the long-term prospects of the Indian hospitality sector and its differentiated brands.
Key Projects and Acquisitions
Significant progress has been made on key projects, including the EM Bypass Calcutta mixed-use development, which is seeing strong sales of service apartments. The 78-room hotel project at The Park Mumbai, Juhu, is targeted for launch in October 2027. The acquisition of Malabar House in Fort Kochi, comprising 17 keys, is expected to be completed by October-November 2026. Additionally, the company is leveraging increased FSI at its Pune land for hotel development.
Financial Guidance and Capital Expenditure
The company provided capital guidance, anticipating a CAPEX of approximately INR 1,140 Crores for ongoing projects, including acquisitions and renovations. Of this, EM Bypass is expected to contribute funding of about ₹350 crore. Operational CAPEX is estimated at ₹40 crores per year for the next 4-5 years, with Flurys requiring another ₹40 crores per annum. The overall CAPEX requirement net of EM Bypass contribution is around ₹1500 crore, with plans to finance approximately ₹1300 crore over 4-5 years from internal accruals and a low net debt-to-EBITDA ratio.
Source: BSE
