Indian Hotels Shares Rally on Strong Q2 Performance
Shares of The Indian Hotels Company Ltd (IHCL), a prominent Tata group entity, climbed nearly 6% in Thursday's trading session. This significant rise followed the announcement of better-than-expected September quarter results and an upward revision of its revenue growth outlook for the full financial year 2027 (FY27).
IHCL's stock reached a session high of Rs 794.75 apiece, reflecting investor confidence in the company's robust financial performance and optimistic future projections. The company now anticipates consolidated hotel revenue to grow by 17-19% year-on-year, pushing its total revenue growth guidance for FY27 to 15-17%.
Robust Financials for September Quarter
For the September quarter, IHCL reported a net profit increase of 19% year-on-year, reaching Rs 379.85 crore. Quarterly revenue also saw a healthy surge, rising 22% year-on-year to Rs 2,484.32 crore. This marks IHCL's 18th consecutive quarter of record-breaking performance, underscoring its consistent operational excellence.
The company achieved an Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of Rs 788 crore, with margins standing at 30.7%. Consolidated operating EBITDA specifically improved by 24% year-on-year to Rs 706 crore, leading to an operating EBITDA margin of 28.4%. The hotel segment alone saw its revenue grow 24% to Rs 2,284 crore, with operating EBITDA increasing 30% to Rs 655 crore.
Standalone figures also reflected strong growth, with revenue from operations up 26% year-on-year to Rs 1,336 crore and standalone net profit climbing 36% to Rs 393 crore.
Ambitious Growth Trajectory and Brokerage Targets
IHCL, which manages renowned brands like Taj, Vivanta, SeleQtions, and Ginger, has outlined an aggressive expansion plan. As of September 30, 2026, the company operated 390 hotels and has a robust pipeline of 280 additional properties. It successfully opened 20 hotels in the first half of FY27 and plans to open 30 more in the second half, aiming for a total of 50 new openings for the full financial year. This trajectory is expected to push the total operational hotels to 400 by the third quarter of FY27.
Following these positive developments, several brokerages reaffirmed their optimistic outlook on IHCL shares:
- HSBC maintained a Buy rating with a target price of Rs 910.
- Macquarie retained an Outperform rating, setting a target price of Rs 860.
- Goldman Sachs also reiterated a Buy rating, with a target price of Rs 890.
Continued Momentum Despite Global Headwinds
IHCL emphasized that its hotel business continues to demonstrate remarkable resilience, navigating geopolitical disruptions, new hotel stabilization costs, and ongoing investments in technology, brand development, and talent. The company anticipates sustained momentum in like-for-like total revenue per available room (TRevPAR), with recently renovated assets contributing to higher yields upon their return to operation.