Chalet Hotels (CHALET) Q1 24/25 earnings summary

Executive summary

• Achieved the strongest Q1 performance in company history, with consolidated revenue up 17% year-over-year and adjusted EBITDA up 14% year-over-year, despite challenges from elections, heatwave, and subdued MICE and leisure demand.

• Announced acquisition of an 11-acre beachfront land in South Goa for a five-star deluxe resort, with approvals in place and construction expected to begin soon.

• Continued focus on asset-led growth, operational efficiency, and expansion in key markets including Goa, Bengaluru, and Mumbai.

• Strong macroeconomic backdrop with 7% expected GDP growth and infrastructure development supporting demand outpacing supply.

• Commitment to sustainability, targeting net zero greenhouse gas emissions by 2040 and significant progress in renewable energy sourcing.

Financial highlights

• Q1 FY25 consolidated revenue was ₹3,691 million (up 17% YoY); adjusted EBITDA was ₹1,483 million (up 14% YoY); adjusted EBITDA margin was 40.2%.

• Hospitality segment revenue increased 15% to ₹3,255 million; segment adjusted EBITDA up 12% to ₹1,341 million (41.2% margin).

• Portfolio occupancy reached 70.5%, up 85 bps year-over-year; ADR stable at ₹10,446 (+1%).

• RevPAR up 2% to ₹7,361; same-store RevPAR up 4%.

• Profit before tax was ₹777 million (up 109% YoY); consolidated net profit for Q1 FY25 was ₹606.47 million.

Outlook and guidance

• Expecting improved flow-throughs and higher margins for the rest of the year as renovations complete and seasonality improves.

• Double-digit revenue growth targeted for subsequent quarters, with July already showing strong trends.

• Pipeline of 1,000 rooms to be added over the next three years, with occupancy expected to rise to mid-70% on a same-store basis.

• Margin expansion above 40% expected to be sustained.

• Strong pipeline with multiple hotel and commercial projects scheduled for completion between FY25 and FY27.