Indian Hotels' Q1 Profit Slumps 39% Sequentially as Peak Season Fades
Revenue and profit grew year-on-year, but a sharp sequential decline from the holiday quarter highlights the business's seasonal nature.
The Indian Hotels Company reported a 14.6% YoY revenue increase in Q1 FY27, but profit fell sharply from the previous quarter's peak. The net profit margin also retreated from the highs of Q4.
The Indian Hotels Company (IHCL) delivered a mixed set of numbers for the first quarter of FY27. While the hospitality leader posted healthy year-on-year growth, its performance retreated significantly from the peak holiday season, underscoring the cyclical nature of the business.
The company's revenue for the June quarter stood at ₹2,339 crore, a solid 14.6% increase compared to the same period last year. Profit after tax (PAT) grew even faster at 18.7% year-on-year to ₹391 crore, lifting the net profit margin by 60 basis points to 16.7%. However, the sequential comparison tells a different story. Coming off a strong Q4 FY26, revenue fell 15.4% quarter-on-quarter, while profit saw a steeper 39.4% decline.
Revenue (₹ Cr)
Profit (₹ Cr)
Net Profit Margin (%)
| Metric | CurrentQ1 FY27 | PreviousQ4 FY26 | Same quarter LYQ1 FY26 |
|---|---|---|---|
| Revenue (₹ Cr) | 2,339.19YoY +15% | 2,765.29 | 2,041.08 |
| Profit (₹ Cr) | 390.81YoY +19% | 645.43 | 329.32 |
| Net Profit Margin (%) | 16.7YoY +3.7% | 23.3 | 16.1 |
The table above illustrates the typical seasonal pattern, with Q3 (the festive and winter travel quarter) consistently being the most profitable. The trailing twelve-month (TTM) net profit margin remains robust at 23.1%, indicating that profitability over a full cycle is holding up well.
Key Points
- The company maintains a strong balance sheet with zero debt and a healthy Return on Equity (ROE) of 18.13%.
- The stock has delivered impressive long-term returns, with an 87.2% gain over the past three years, translating to a 23.2% annualised return.
- At a P/E of 39, the valuation is broadly in line with the industry average, reflecting the market's confidence in its premium positioning and growth prospects.
While the Q1 sequential dip is expected, the focus now shifts to how strongly the business rebounds in the upcoming quarters as the travel season picks up again.
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· INDHOTEL
(BSE)
ISIN: INE053A01029
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