ITC Hotels delivered impressive Q1FY27 results with consolidated net profit attributable to owners surging 35.42% year-on-year to ₹180.25 crore compared to ₹133 crore in the corresponding quarter last year. The stock responded positively, rising 1.24% to ₹176.15 after the results announcement, recovering from earlier sequential decline concerns. According to latest reports, the strong year-on-year growth momentum overshadowed investor concerns about quarterly performance comparisons. Net profit had declined 43% and revenue fallen 25.3% on a sequential basis in the previous quarter, but the company has now flagged "heightened uncertainty and volatility" adding to inflationary pressures in the hospitality sector owing to disruptions caused by the West Asia conflict. The company's strong demand recovery, asset-light expansion strategy, and ample cash for acquisitions position it for sustained earnings growth.
Consolidated revenue from operations increased 14.77% year-on-year to ₹936.02 crore in Q1FY27, up from ₹816 crore in the year-ago period, reflecting continued momentum in room demand and hospitality services. Excluding branded residences, revenue from operations grew 10% YoY, demonstrating strong underlying business performance. Total expenses in the first quarter were higher at ₹750 crore, compared with ₹674.9 crore in the same period a year ago. Other income rose 32.5% to ₹58.52 crore, taking total income up 15.7% to ₹994.54 crore. Profit before tax increased 31.46% to ₹248.20 crore from ₹188.80 crore, with the profit-before-tax margin expanding by 337 basis points to 26.5%. Basic and diluted earnings per share increased to ₹0.87 each, compared with ₹0.64 in the year-ago quarter. Operating performance also improved significantly, with EBITDA increasing 19.6% YoY to ₹292 crore from ₹245 crore, while EBITDA margin expanded to 31% compared to 30% in the same quarter last year.
The operating environment during the quarter was marked by heightened uncertainty and volatility, driven by the West Asia conflict, which disrupted air travel and added to inflationary pressures, according to ITC Hotels' statement. The month of April 2026 witnessed broad-based demand softness across key markets, driven by uncertainty around air travel, as reflected in weak foreign tourist arrivals. However, as travel sentiment improved, occupancy and room rates witnessed a swift recovery in May and June 2026. The company noted that the outlook remained positive, backed by infrastructure and connectivity improvements and rising discretionary consumption, coupled with favourable supply-demand dynamics in the hospitality segment, particularly in Tier-I cities. The company will monitor developments in West Asia, higher input costs for energy, food and fuel, depreciation of the Indian rupee, and the progress of the monsoon according to its investor presentation.
The hotels segment revenue rose 10.05% to ₹881.06 crore from ₹800.57 crore, while segment result increased 22.9% to ₹176.54 crore. The branded-residences business generated revenue of ₹37.77 crore during the quarter, compared with nil in the year-ago period, with its segment result standing at ₹13.22 crore against a loss of ₹30 lakh earlier. Revenue from the company's other operations, comprising golfing and ancillary services, increased 16.6% to ₹11.73 crore, though the segment result declined 18.7% to ₹3.75 crore. The company maintained a 33% RevPAR premium over the industry, reflecting continued demand for its hotel portfolio. Room revenue increased 8% YoY, driven by strong demand from the retail segment, which helped offset the high base created by the MICE and wedding business in the corresponding quarter last year. Average Daily Rate (ADR) improved 4% YoY, while occupancy expanded by 290 basis points, leading to an 8% growth in Revenue Per Available Room (RevPAR).
In a significant strategic move, ITC Hotels announced the acquisition of GHK Hospitality & Infrastructures Ltd at an enterprise value of ₹155 crore through primary subscription and secondary purchase of GHK's equity shares. The transaction will be completed at an enterprise value of ₹155 crore on a debt-free and cash-free basis, subject to customary adjustments, with the acquisition expected to be completed during the current quarter. Welcomhotel Ahmedabad is a 130-room upper-upscale business hotel located on Ahmedabad's Ashram Road overlooking the Sabarmati Riverfront, featuring 8,500 sq. ft. of banqueting space, a restaurant offering Indian and global cuisines, and a rooftop swimming pool. The hotel is currently operated by ITC Hotels under an Operating Services Agreement and will be strategically located on Ahmedabad's prominent Ashram Road, overlooking the scenic Sabarmati Riverfront and offering convenient access to Ahmedabad International Airport and the Narendra Modi Stadium. Anil Chadha, Managing Director of ITC Hotels, stated that the acquisition will strengthen the company's owned asset portfolio in Ahmedabad by enhancing presence across hospitality segments and price points, with the deal expected to be EPS accretive in the first full year of operations post completion.
During the quarter, ITC Hotels signed eight new hotel agreements, taking its managed portfolio to more than 200 hotels with around 16,000 keys, reinforcing its asset-right expansion strategy. The company's portfolio crossed 22,000 rooms across markets with 156 operational hotels in India with 14,300 rooms across seven brands. The quarter saw eight new hotel signings in Jaipur, Manesar, Bhubaneswar, Sonipat, Shirdi, Shahjahanpur and Zirakpur, along with the signing of the 25th Storii property at Amchong Tea Estate, Guwahati. The company announced a final dividend of ₹1 per equity share for FY26, subject to declaration at the 3rd Annual General Meeting on August 6, 2026, with the record date being May 21, 2026. These acquisitions reflect the company's strategy to strengthen its presence across key commercial and leisure markets in India, while reinforcing its position as a leading player in the country's growing hospitality sector. The company operates hotels across 90+ destinations under brands like ITC Hotels, Mementos, Epiq Collection Storii, Welcomhotel, Fortune, and Welcome Heritage.
