6%. In management contracts, they manage hotels owned by someone else so it can not be very high percentage.
Have been following this thread very closely as I am invested in ROHL. Took the opportunity of the dip to add to my position. Very much bullish in this stock due to impressive management, quick turnaround after pandemic, proposed addition in number of rooms and future potentiality, and last but not the least, reasonable valuation.
Would appreciate very much, opinion on technical indicators and chart analysis.
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A long range bound consolidation is happening at the ATH zone and stock has rebounded from 200 ma bands, some movement can be expected above 309 which is upper range
Two queries:
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Keshav Baljee is also founder of separate entity Spree Hotels. Isn’t this conflict of interests? The promoters already have listed Orchid Hotels and they are also operating separate business (competitor)?!
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I understand this is a small cap, but still there is no participation from mutual funds?
Disc: Not invested. Still connecting the dots.
Q1 concall summary iro Royal Orchid Hotels -
Revenues - 73 vs 63 cr , up 16 pc
EBITDA - 23 vs 24 cr
NP - 10 vs 11 cr
ARR - Rs 5220 vs Rs 4880 YoY
Decrease in EBITDA and NP due substantial increase in employee salaries to control attrition ( due salary cuts during COVID )
Also spent higher amounts on upkeep and maintenance of hotels which wasn’t done during the COVID period
Cost of borrowings was also up YoY
Well on track to cross > 100 hotels this yr (by Oct). Currently operating 94 hotels. 13 hotels added in Q1- mostly management contracts
Avg occupancy of newly opened hotels ( mostly on management contracts ) is lower. Takes time to build up occupancies. Occupancies of older hotels is > 80 pc !!! ( Industry leading )
Repair and Maint costs should moderate by Q3
Management is aiming for an ambitious tgt of Rs 400 cr topline for FY 24. Even if they miss it by 8-10 pc, it would be a great outcome …IMHO
Occupancies of hotels added even 2-3 yrs back is also > 75 pc !!!
Aim to maintain a staff/room ratio of 1.3 on an overall basis
Focussing on increasing Banquet revenues … showing an encouraging trend. Conference business is also back
Hope to reach room count of 8000 by FY25 end
Intend to expand the company’s resorts in Goa and Bangaluru … both are as such doing quite well
Current room count at 5600. Aim to reach 6500 rooms by end FY24
All this expansion will be via management contracts of existing properties and some revenue share models. Don’t intend to set up own Greenfield hotels
Generally, hotel industry does 40:60 revenue split in H1:H2
July has been soft due heavy rains in Goa/HP
Aim to do 120cr EBITDA in FY 24 … if that happens (even if they do about 110 cr vs 82 cr LY) …it ll be a happy situation for the shareholders …IMHO
Income from management fees ( that they get by managing hotels ) LY was 24 cr
Disc: hold a tracking position
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Royal Orchid Hotels -
Q3 Concall highlights -
Revenues - 87 vs 76 cr
EBITDA - 29 vs 28 cr
PAT - 15.7 vs 15.2 cr
Revenue break up ( segment wise ) -
Room rent - 46 vs 43 cr
F&B - 33 vs 28 cr
Other services - 3.6 vs 2.8 cr
Management fees - 8 vs 6 cr
Revenue break up ( model wise ) -
Owned hotels - 30 vs 24 cr
Leased / revenue share hotels - 34 vs 27 cr
JVs / Associates - 18 vs 23 cr
Management fees - 8 vs 6 cr
Added 05 hotels with 210 rooms in Q3. Added 20 hotels with 1030 rooms in 9M FY 24
Company held 51 pc stake in a 130 room hotel in Bangalore. Acquired additional 49 pc stake by paying 34 cr in Q3. The money was paid via internal cash generation
Out of a total of 100 hotels that the company is operating, around 80 odd hotels are just being managed by the company. Here, the company gets a management fees of around 3 pc of the property’s revenue. For Q3, total revenue received by the company from management contracts is 8 cr for managing 80 hotels. That amounts to roughly 3.5 lakh / month / hotel. Company makes an EBITDA of around 50 pc on these properties
Expecting to do a topline of 340 cr this yr and 390 cr for next FY ( both - including the Jaipur hotel ). Expecting an EBITDA of 120 cr for next FY
Company intends to add 38-40 more hotels in next FY - adding the room inventory by around 2500 rooms. Out of these, 03 hotels will be on the lease / revenue share model - which gives a bigger kick to the top/bottom line
ARRs for Q3 at Rs 5600
Post Mar 25, company shall focus on larger hotels on revenue share models. Company’s aim was to expand aggressively in FY23-25 period so as to establish its brand name. Once that is done, company can get hold of a lot more leased / revenue share hotels ( otherwise, ppl were not taking them as seriously )
Hotel industry is undergoing a boom similar to 2003-08. Bank financing rates have also fallen while extending loans to Hotel industry
Company intends to re-work their branding architecture so as to clearly differentiate between their 5 star vs 3 star offerings
Expecting an ARR hike of 6-8 pc for next FY
Company is expanding the room capacity at their owned hotels at Goa ( adding 44 rooms ), Bengaluru ( adding 28 rooms )
Company is expanding the room capacity at their owned hotels at Goa ( adding 44 rooms ), Bengaluru ( adding 28 rooms )
At present, company is not planning to open up at Ayodhya or Lakshadweep as the company doesn’t want to do any Greenfield capex right now
Disc: holding, biased, not SEBI registered
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