Praveg Ltd Q1 FY26 Earnings Analysis

- Praveg Limited plans to expand from approx. 770 rooms currently to over 2,500 rooms by Vision 2028, targeting 55 to 65 locations. - The company aims to increase inventory by about 50% annually, adding around 505 rooms in the coming year. - New resorts under development include Serengeti, Thinnakara-II (200 rooms), Kashid, Kihim, and Jaisalmer, expected to become operational soon, contributing significant incremental revenues. - Revenue growth is expected as newly operational resorts mature, with marketing and branding efforts expected to improve occupancy and ARR within 6-12 months of opening. - The smart toilets and outdoor advertising vertical is set to deliver significant revenue growth, with potential incremental revenue increasing 80-90% year-over-year. - Event and wedding business, especially in Kevadiya, is expected to contribute a "tremendous incremental" revenue boost this year. - Overall, EBITDA margins are projected to improve beyond the current ~34-35% as newer resorts stabilize.

- Praveg Limited reported robust growth in FY ‘25 with consolidated total income of Rs. 174.43 crores, EBITDA of Rs. 56.88 crores, and net profit of Rs. 16.13 crores. - EPS for FY ‘25 on a consolidated basis was Rs. 5.96, up slightly from Rs. 5.78 last year. - The company targets an average EBITDA margin of around 40% over project periods, expecting incremental improvement in FY ‘26 as newer resorts mature. - Expansion plans include operationalizing 25 resorts by FY ‘26 with room inventory potentially increasing to 1,250-1,300 rooms. - New properties usually take 6-12 months to build ARR and occupancy; margins and revenue expected to improve with time. - The advertising and smart toilets verticals have strong growth potential, contributing up to 80-90% incremental revenue growth in initial years. - Strategic partnerships (with IHCL and Mahindra) and international projects like Serengeti aim to boost profitability further. - Overall, Praveg is optimistic about steady revenue, EBITDA, and net profit growth aligned with Vision 2028 targets.

- Current CAPEX: Approximately Rs. 30-40 crores planned to complete work-in-progress on 4-5 resorts. - Rs. 100 crores CAPEX to convert work-in-progress at Thinnakara (200 rooms) into developed assets this year. - Future CAPEX funding primarily through existing resources, including warrants and promoter/fund contribution if required; company is debt-free and prefers no new debt. - Strategic "Development plus Operation" model initiated: Praveg partners with landowners who invest in development; Praveg provides turnkey development and operates properties with no CAPEX burden on itself. - This model is expected to contribute significantly to revenue and profit soon without requiring fresh capital from Praveg. - Planned development and operation of 5-10 resorts this year; approvals and work ongoing on multiple projects including Serengeti, Kashid, Kihim, Jaisalmer, and Lakshadweep. - Expansion in outdoor advertising/media with zero CAPEX smart toilet projects generating recurring revenue.

- Praveg Limited is currently a debt-free company and does not plan to raise any debt as per their strategy. - For funding CAPEX and expansion, the company plans to utilize its existing resources including funds from warrants. - They are also exploring a unique development plus operation model where they develop and operate resorts on land owned by investors, requiring zero CAPEX from Praveg. - This "operation and development" model allows revenue generation from property development without the need for raising additional equity or preference share capital. - Overall, no immediate plans to raise funds through debt or equity were indicated; funding will come from internal accruals, warrants, and innovative partnership models.

- Praveg Limited has several resorts under development, with 505 upcoming rooms expected to be operational in the current year. - Specific projects under progress include Serengeti (25 rooms, already working under development), Thinnakara-II (200 rooms), Kashid and Kihim (around 35 to 40 rooms each), and Jaisalmer (40 to 50 rooms nearing approval). - Bangaram resort is already operational (50 rooms given to Indian Hotels as of January 2025). - The company expects to operate around 25 resorts by the end of the year. - They have plans to build 5 to 10 new resorts this year. - Potential acquisitions of ready or underdeveloped properties are also being considered to expand the pipeline. - International projects include the Serengeti project with environment clearance received and ongoing development. - Expansion at Masai Mara is also in progress for additional resort locations.