Royal Orchid Hotels Ltd Q4 FY26 Earnings Analysis

- Next financial year (FY27-'28) revenue guidance is around INR 500 crores. (Page 17) - Managed business topline expected to grow from current INR 45 crores to around INR 55-58 crores next year, with EBITDA margin around 47-48%. (Page 17) - ICONIQA hotel expected to peak next year with quarterly revenue reaching INR 28-30 crores range, higher than current INR 23-24 crores. (Page 13) - 47 new hotels signed, expected to open over next 1 to 1.5 years, leading to significant growth in management fees and overall topline. (Pages 12, 17, 19) - Additional revenue from four upcoming revenue-sharing hotels estimated around INR 90-100 crores topline combined when fully operational. (Page 5) - Focus on asset-light strategy with strong growth in managed hotels aiding volume growth. (Multiple pages)

- The company expects nearly 20% growth next year, driven by the addition of 47 new hotels, leading to substantial top-line and EBITDA growth in managed business. - Managed business top line projected to grow from INR45-58 crores to around INR55-58 crores next year with EBITDA margin around 47-48%. - ICONIQA hotel revenue is anticipated to peak next year with potential quarterly revenue reaching INR28-30 crores, improving profitability beyond current levels. - Q4 expected to show better results for ICONIQA with turn to profitability, overcoming Q3 pre-operating expenses impact. - FY27 revenue guidance is INR420-450 crores overall. - The firm aims for INR500 crores top line by FY27-28, maintaining a cash asset-light strategy with no large CapEx plans. - EBITDA and profitability growth depends significantly on ramp-up of new hotels and management fees from them. - EPS dip this year attributed to IndAS accounting effects on fixed lease assets; underlying cash profits remain strong.

- No large capital expenditure is planned for the next financial year; the company will maintain a cash asset-light strategy. (Page 16) - Renovation plans are being evaluated for the Bangalore Central hotel (MG Road property), with money to be invested once the exact plan is finalized, aiming for an uptick in RevPAR. (Page 16) - There are ongoing discussions and potential investments related to future hotel projects, including greenfield and conversion hotels as part of the pipeline of 47 signed hotels expected to come up in about one to one and a half years. (Pages 12-13) - The company is considering how to deploy proceeds from a subsidiary sale (INR30-35 crores expected) — whether to clear debt or utilize the funds for growth, possibly including inorganic acquisitions or projects similar to ICONIQA with capital outlay. (Pages 6, 16)

- No explicit mention of any planned new fundraising through debt or equity in the current call. - Company is focused on maintaining an asset-light strategy with limited capital expenditure. - Discussion around use of proceeds from subsidiary sale (approx. INR30-35 crores) is ongoing—options include debt repayment or growth investments. - Management highlights a strong balance sheet and reduced debt following subsidiary sale. - No large capital expenditures or major equity raises planned in the near term. - Future acquisitions or investments like ICONIQA may involve indirect capital outflows but no clear debt/equity fundraising planned yet. - Management prefers to finalize budgets by March-end before providing definitive guidance on financial strategy for FY27-28.

- Royal Orchid Hotels has signed 47 hotels currently in the pipeline, expected to come up within the next 1 to 1.5 years. - Some of these are Greenfield projects which may take slightly longer. - There are additional conversion hotels under discussion, which could supplement the 47 signed hotels. - The company targets adding around 3,000 to 4,000 rooms annually to reach 22,000 rooms by FY30. - For Q4 FY26, confirmed hotel openings include Ambala, Rishikesh, Bhuj, and Bhadohi with roughly 220 keys; some openings may push to Q1 FY27. - Discussions are ongoing for further managed and flexi-lease hotels, aiming for 8 ICONIQA hotels by 2030 as a target. - Pipeline visibility is strong with new markets emerging, supporting steady growth and expansion.