Ranvir’s Portfolio

SAMHI HOTELS –

Q3 FY 24 results and concall highlights –

Company profile –

Operate a total of 31 Hotels, 4800 rooms in 13 cities under 8 brand names

Upscale Hotel rooms – 1074. These include properties like –

Hyatt @ Gurugram, Pune
Sheraton @ Hyderabad
Renaissance @ Ahemdabad
Courtyard @ Bengaluru

Upper Midscale Hotel rooms – 2163. These include properties like –

Four Points @ Pune, Vizag, Jaipur, Chennai
Fairfield by Marriot @ Bengaluru (03 hotels), Coimbatore, Chennai (02 hotels), Hyderabad
Caspia @ Delhi

Midscale hotel rooms – 1564. These include properties like –

HIEX @ Pune (02 hotels), Ahmedabad, Bengaluru, Nasik, Hyderabad, Gurugram, Chennai
Caspia Pro @ Noida

Q3 FY 24 financial outcomes –

Revenues – 268 vs 191 cr
EBITDA – 85 vs 62 cr ( margins @ 32 vs 33 pc )
PAT – (-) 74 vs (-) 80 cr ( There was an exceptional loss of 75 cr )

Continue to hold cash of Aprox 300 cr – to be used to reduce debt further to reduce the interest costs

Since company’s hotels are primarily in Metro cities, their weekday occupancies are higher than their weekend occupancies

Aim to take the rooms inventory to > 5400 rooms by FY 27

By Sep 24, company would have added 180 rooms to its existing portfolio of 4800 rooms. Plus company’s additional 130 renovated rooms will also come on stream by Sep 24. Basically, the company would drive revenues from additional 310 rooms which did not contribute in Q3 FY 24

Finance costs in Q3 were 65 vs 115 cr YoY. This is likely to reduce further

Company’s net debt now stands at 1800 cr vs 2900 cr in June 23

Current cost of debt stands at 10.3 vs 13 pc pre – IPO

Debt/EBITDA guidance for end of FY 25 @ 3.5 – signalling rapid debt reduction

A lot of company’s hotels are managed by Marriot group. They charge an avg of 4.9 pc of revenues as management fees

Company’s assets in Tier -1 cities are outperforming the Tier -2 assets by a wide margin

International travel is also picking up. However, still lower than pre-Covid levels

Company is very confident about demand trends for Hotels for next 2-3 yrs. Usual spoiler for hotel industry used to be over-supply. At present, an over-supply situation is not on the horizon for next 4-5 yrs

India is adding 40 million sq ft of office space every year. This is like adding one Singapore / year. This bodes very well for the Hotel industry in Tier – 1 cities

Company is likely to be in green at PAT level in Q4

Company is expecting ARR growth rates in double digits for next 2-3 yrs. This is likely to result in much higher EBITDA growth due operating leverage

Since the company is a business hotel focussed chain, the seasonality doesn’t hit them as much as Leisure hotel chains

Disc: holding, biased, not SEBI registered