Metrics cut 2
- Bandhavgarh and Srinagar openings: now guided to Q4 CY2027 (Oct-Dec) (vs earlier expectations)
- Ranthambore opening: delayed by ~2 quarters due to wall stabilization; management expects to fast-track and catch up
Event Participants
Executives
3 Anuraag Bhatnagar (CEO), Ravi Shankar (Head of Asset Management & CFO), Abhishek Agarwal (SVP, FP&A & IR)
Analysts
8 Karan Khanna (Ambit Capital), Dipak Saha (Ashray Construction Equities), Achal Kumar (HSBC), Girish Choudhary (Avendus Spark), Vaibhav Mulay (Haitong Securities), Prashant Bihani (Millara Capital), Sumant Kumar (Motilal Oswal), Karan Kamdar (Choice Institutional Equities), Akash Gupta (Nomura), Madhav Jhawar (SKP Securities), Abhishek Khanna (Kotak Securities)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Operating Revenue | ₹352 crores | +28% YoY, driven by strong same-store growth, Coorg contribution, higher F&B revenues, and HMA fee growth |
| Operating EBITDA | ₹143.4 crores | +41% YoY; 383 bps margin expansion to 41% (record Q1 margin); over 60% EBITDA flow-through excluding Coorg |
| Operating EBITDA Margin | 41% | Expanded 10 percentage points over two years from 31% in Q1 FY2025; summer quarter typically lower vs ~48-50% FY average |
| Consolidated PAT | ₹48.8 crores | 5x YoY growth, aided by lower finance costs post-IPO debt reduction; includes ₹15.6 crore loss from Dubai JV share |
| RevPAR Growth | +17% YoY | Driven by 10% ADR increase plus 4pp occupancy improvement; same-store RevPAR growth 15% |
| ADR Growth | +10% YoY | Pricing power sustained despite temporary international demand softness |
| Occupancy | 67.5% | Up from 63.6% YoY; five existing Palaces at ~70%, resorts inching toward 60% |
| RevPAR Index | 1.4x | Up from 1.3x in Q1 FY2026 vs competitive set, reflecting continued market share gains |
| F&B Revenue | ₹132-133 crores | +25% YoY; 38% of operating revenue; >50% of city hotel F&B from non-resident guests |
| HMA Fees | ₹26.2 crores | +86% YoY, driven by ramp-up of managed properties, performance-linked incentives, and key money recoveries |
| Net Debt | ₹1,270 crores | Gross debt ~₹1,500 crores; net debt to LTM EBITDA at 1.66x |
| Brand Website Contribution | 16% of bookings | Doubled YoY, reducing OTA reliance; direct channels at ~64% of business |
| Total Portfolio | 25 properties / 5,257 keys | 15 operational hotels, 10 in pipeline (incl. Tadoba signing); roughly half owned/half managed |
Geographic & Segment Commentary
City Hotels: RevPAR grew 14% with occupancy rising to nearly 70%. Delhi well-positioned for BRICS Summit (Sept 12-13) and marquee events with contracted delegations. Bengaluru and Chennai maintain large GDS/corporate share with C-suite representation. The Azulian House signature restaurant (74 covers, 3,300 sq ft) opened in Bengaluru to strong reviews.
Resorts: RevPAR grew 24%, driven by multi-generational travel trends, enhanced programming (kids clubs, wellness, new F&B venues like Amber Terrace in Jaipur), and driving-distance leisure demand. Resort occupancy ~59% in FY2026, targeting mid-60s over coming years. International room revenue mix recovered from -10% YoY in March to +1% YoY by June.
Coorg (The Leela Coorg Forest Sanctuary): Rebranded July 8, 2026, ahead of schedule. ADR nearly doubled post-acquisition; achieved operational EBITDA breakeven in Q1 pre-rebranding. Post-rebranding ramp-up driven by Leela distribution network, loyalty ecosystem, and wellness-focused international travelers.
Dubai JV (25% stake): Operating at breakeven despite West Asia conflict impact on occupancy/ADR; accounting loss of ₹15.6 crores due to asset-level interest and depreciation. Leela to take over operations CY2027, renovation ~1 year. Dubai residential market resilient with record 296 home sales above $10M in FY2026.
Company-Specific & Strategic Commentary
Brand Recognition: Ranked world's #2 hotel brand in Travel + Leisure World's Best Awards 2026 — 5th time since 2020 in top 3 globally. NPS of 86, 12 points above APAC luxury average, driving repeat visitation and ADR premium.
Tadoba Signing: New 30-key luxury wildlife resort on 62-acre site under 60-year concession (extendable +30 years), ₹120 crores project, targeted CY2030 completion. IRR underwritten at 15-17%. Creates wildlife circuit with Ranthambore and Bandhavgarh.
Leela Centre of Excellence (LCOE): 9,600 sq ft learning hub with Le Cordon Bleu partnership; expected to train 3,000+ associates over 3 years to support scaling culture across 25+ hotels. LEAD program at IIM Ahmedabad for 20 executive committee members.
Expansion Pipeline: 1,000+ keys under development across Bandhavgarh, Ayodhya, Agra, Ranthambore, Sikkim, BKC Mumbai. Opening timeline: Jaisalmer and Luxury Residences Mumbai by end CY2026; Srinagar and Bandhavgarh Q4 CY2027 (Oct-Dec); Agra, Ayodhya, Sikkim, Ranthambore CY2028; Tadoba CY2030.
Value Drivers & ESG: ARQ by The Leela expanded to Delhi, Chennai launch upcoming; wellness facility in Bengaluru; renewable energy projects at Coorg/Chennai. All owned hotels (incl. Coorg) have platinum green building certification; ~2/3 of electricity from green power, targeting 75%; net zero 2050 ambition on track.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| RevPAR Growth FY2027 | Double-digit | Management "very confident" based on current operating momentum; Q1 delivered 17% (15% same-store) |
| EBITDA Growth FY2027 | Mid-to-high teens | Driven by operating leverage and flow-through (~60%+); margin expected to remain at similar levels with marginal growth |
| EBITDA Margins | Maintain ~50% (FY basis) | FY2026 EBITDA margin ~48%; summer quarter 41% with QoQ improvement expected |
| EBITDA Target FY2030 | ₹2,000 crores (10x FY2020) | On track; same-store has achieved/over-achieved targets; 800 owned room additions in pipeline; 5 new deals signed in last 5 quarters |
| ROCE | Mid-to-high teens in 2 years | Currently double-digit; expected to improve as new hotels operationalize and value drivers stabilize |
| Leverage | Comfortable up to 2.5x net debt/EBITDA | Currently 1.6x; sufficient cash flows from same-store hotels to fund CapEx; debt for value-creative opportunities acceptable |
| International Demand | Progressive recovery | June at +1% YoY (vs -10% in March); Oct-Mar peak season expected to be strong; no change in travel patterns |
| Sri Nagar & Bandhavgarh Openings | Q4 CY2027 (Oct-Dec) | Construction on track; villa construction started (Bandhavgarh), walling/landscaping in progress (Srinagar) |
| Mumbai Residences | Launch end CY2026, move-ins early CY2027 | 56 keys across 200 bays; mock-up rooms finished; show rounds starting year-end |
Risks & Constraints
| Risk | Context |
|---|---|
| West Asia Conflict / Geopolitical Disruption | ~40% of India's international air traffic transits through West Asia; conflict caused temporary slowdown in international arrivals since March. Impact deemed temporary — international mix recovered from -10% YoY in March to +1% by June. If conflict escalates, international demand could face renewed pressure. |
| Dubai JV Accounting Losses | Dubai hotel impacted by reduced travel flows; while operationally breakeven, accounting losses (₹15.6 crores in Q1) will persist until renovation completes (CY2027 handover + ~1 year renovation). No P&L impact on revenue/EBITDA, only share of JV losses. |
| Ranthambore Project Delays | 400-year-old fortress required wall stabilization; delayed by ~2 quarters. Management says once stabilized, can fast-track and catch up on lost time. Other projects have seen minor ~1 quarter delays (previously disclosed). |
| Project Execution Timelines | Tadoba targeted CY2030 (30 keys); approval and design development ongoing. Bandhavgarh and Srinagar now guided to Q4 CY2027 (vs earlier expectations). Execution risk remains on construction timelines. |
| Dependence on Event-Driven Demand | Q2 and H2 performance partly dependent on BRICS Summit and other marquee events creating compression. If events under-deliver on room night demand, occupancy/ADR upside could moderate. |
Q&A Highlights
RevPAR Growth Sustainability & FY2027 Outlook
- Question: Given both occupancy and ADR drove growth in a tough quarter, how should we read this for the rest of the year? (Karan Khanna, Ambit Capital)
- Answer: Growth was broad-based — city hotels +14%, resorts +24%. International business recovered through the quarter (March: -10% YoY → June: +1%). H2 typically strong with international travelers, FTOs, MICE, and global conferences. Historic Leela outperformance (RevPAR growth 1.4x luxury sector, 1.6x overall sector FY2020-26) suggests continued trajectory. Management "very confident" of double-digit RevPAR and mid-to-high teens EBITDA growth for FY2027. (Anuraag Bhatnagar)
Tadoba Economics & Leverage Capacity
- Question: What ARR, occupancy, and IRR have you underwritten for Tadoba? Can it be commissioned earlier? What is the comfortable leverage cap? (Karan Khanna, Ambit Capital)
- Answer: 30-key luxury wildlife resort, 60-year concession (extendable +30 years). IRR of 15-17% — very value-creative deal with attractive concession terms. CY2030 timeline allows for approvals and design development, aligning with wildlife circuit strategy (Bandhavgarh, Ranthambore). Leverage guidance: comfortable to average 2.5x net debt/EBITDA in coming years, with some quarters above/below. (Ravi Shankar)
Domestic Luxury Demand Durability
- Question: Domestic room revenue grew 25% — is the longer average length of stay durable? (Dipak Saha, Ashray Construction Equities)
- Answer: Leela has been building toward domestic segment with resort repurposing: new restaurants (Jaipur), Aujasya spa renovations, unique dining experiences, multi-generational programming. Trends of higher household income, disproportionate luxury spend, longer stays, suites/villas, and multigenerational travel are "here to stay." Resorts within driving distance of major cities are particularly benefiting. (Anuraag Bhatnagar)
BRICS Summit Impact on Delhi
- Question: With ~20% of keys in Delhi, how are rates trending for the BRICS Summit (Sept 12-13)? (Dipak Saha)
- Answer: The Leela Palace New Delhi well-positioned to receive outsized share of demand, similar to AI Summit which created significant compression. Contracted with right delegations; expect benefit from pre and post-event demand in addition to conference dates. (Anuraag Bhatnagar)
July-August Trends & FY2027 Confirmation
- Question: How are July and August trending? (Achal Kumar, HSBC)
- Answer: July fared well with international business marginally above last year's levels; domestic remains very strong. August has festive weekend demand benefiting resorts. No real headwinds foreseen for next quarter or balance of year. Reiterated: double-digit RevPAR growth and mid-to-high teens EBITDA growth for FY2027. (Anuraag Bhatnagar)
International Demand Outlook — Incremental or Replacement?
- Question: As international demand normalizes, will it be incremental to domestic demand or replace domestic activations (groups, MICE)? (Girish Choudhary, Avendus Spark)
- Answer: Both segments equally important — 50/50 mix pre-disruption. International recovered to FY2026 levels since June. Oct-Mar are peak international months with FTOs, tourists, MICE, incentives. Once international fully actualizes in H2, it creates further compression on inventory, enabling pricing power and higher yields during peak days. Domestic growing high double-digit across all hotels — both segments will coexist and drive growth. (Anuraag Bhatnagar)
Direct Bookings & Distribution Economics
- Question: What is the medium-term target for direct website bookings, and what benefit to margins? (Girish Choudhary, Avendus Spark)
- Answer: Website contribution doubled to 16%; direct channels overall at ~64%. Two-thirds of business expected from direct channels on a full-year basis. Investments in revenue management tools, AI overlay, and LLM-accessible content driving direct growth. Cost of direct acquisition is approximately one-third the cost of third-party/OTA channels, contributing to industry-leading margins. (Anuraag Bhatnagar)
HMA Fee Sustainability
- Question: Is the INR 25-26 crore quarterly HMA fee run-rate sustainable (annualized ~INR 100 crores)? (Girish Choudhary, Avendus Spark / Abhishek Khanna, Kotak Securities)
- Answer: HMA is an ongoing business with half the portfolio managed. Contracts have various fee structures — performance-linked and key money-related incentives. Quarterly growth percentages may vary, but trajectory is confident given expanding managed portfolio and upcoming hotels in India and internationally. (Ravi Shankar)
Expansion Pipeline Timelines
- Question: Are there delays in Bandhavgarh, Srinagar, Ayodhya, Agra timelines? (Vaibhav Mulay, Haitong Securities)
- Answer: All projects on track with only minor ~1 quarter delays previously disclosed. Srinagar and Bandhavgarh: walling, landscaping, ceiling work, and villa construction in progress — opening Q4 CY2027 (Oct-Dec). Jaisalmer and Leela Residences: interiors/pre-opening teams in place — opening by end CY2026. Agra piling started; Ayodhya test piling complete, main piling by mid-late August; Sikkim civil work started. Ranthambore: wall stabilization of 400-year-old fortress caused ~2 quarter delay; can fast-track once complete. Tadoba: concession signed, CY2030. (Anuraag Bhatnagar)
Coorg Performance & Expansion
- Question: How has customer response been since acquisition and rebranding? What revenue contribution expected FY2027? (Vaibhav Mulay, Haitong Securities)
- Answer: Excellent response on social media and TripAdvisor; experiences and programming created for F&B and wellness. ADR nearly doubled, EBITDA breakeven achieved in Q1. Post-rebranding (July 8), ramp-up driven by integration into Leela distribution, loyalty ecosystem, and direct channels. Focus on stabilizing asset first; 19-key brownfield expansion to follow later. (Anuraag Bhatnagar / Ravi Shankar)
Dubai Asset Plans
- Question: Given Middle East conditions, any plans to prepone/or postpone CapEx? (Prashant Bihani, Millara Capital)
- Answer: On track with plan — handover from existing operator early next year (CY2027), renovation over ~12 months, rebrand to Leela. Dubai luxury residential market resilient (record 296 home sales >$10M in FY2026); residential sales plan unchanged with 2-3 year timeframe factored. (Ravi Shankar)
EBITDA Margin Drivers
- Question: What drove the high margin this quarter — any one-offs? Are FY2027/FY2028 targets set? (Karan Kamdar, Choice Institutional Equities)
- Answer: No one-offs. Consistent margin expansion through cost management: renegotiated AMCs and vendor rates, renewable energy share at 67% targeting 75%, revenue growth flow-through. Q1 is summer quarter (41%); FY basis runs ~50% (FY2026: ~48%). Expect similar levels with marginal growth as ARR grows. (Ravi Shankar)
FY2030 EBITDA Target Bridging & ROCE
- Question: How do we get from here to the ₹2,000 crore EBITDA target by FY2030? What upside if more rooms added? What ROCE? (Achal Kumar, HSBC / Akash Gupta, Nomura)
- Answer: On track — same-store targets achieved or over-achieved; 800 owned room additions in pipeline with construction started and financing/approvals in place; five new deals signed in last five quarters; double-digit RevPAR growth expected to flow through to EBITDA at ~60% operating leverage. All IPO value drivers operational and stabilized. ROCE: double-digit currently, moving to mid-to-high teens in ~2 years when new hotels become operational. (Ravi Shankar)
City Hotel Occupancy Ceiling
- Question: City hotel occupancy at 72% blended FY2026 — can it reach 80%? (Madhav Jhawar, SKP Securities)
- Answer: No specific target; focus on ADR positioning alongside occupancy growth. Luxury hotels can operate close to 80%, company can cross 75% threshold, but more targeted toward driving ADR-led growth rather than occupancy. (Ravi Shankar)
Key Takeaway
The Leela delivered a record Q1 FY2027 with operating revenue growth of 28% to ₹352 crores and operating EBITDA up 41% to ₹143 crores at a 41% margin (383 bps YoY expansion), demonstrating resilience despite West Asia-related travel disruptions — international mix recovered from -10% YoY in March to +1% by June, while domestic room revenue grew 25%. RevPAR grew 17% (15% same-store) on a base of 20% growth last year, with city hotels at +14% and resorts +24%, driving the RevPAR index to 1.4x. Strategic execution continues across all fronts: Tadoba concession signed (30 keys, 15-17% IRR, CY2030), Coorg rebranded ahead of schedule with ADR nearly doubled and EBITDA breakeven achieved, HMA fees up 86%, direct website bookings doubled to 16% of mix, and the Leela Centre of Excellence launched with Le Cordon Bleu to train 3,000+ associates. Management reiterated FY2027 guidance of double-digit RevPAR growth and mid-to-high teens EBITDA growth, with the 10x FY2030 EBITDA target (₹2,000 crores) on track through 800 owned room additions and continued value-creative signings. Key watch points include Dubai JV accounting losses until CY2027 renovation handover, Ranthambore's wall stabilization delay, BRICS Summit-driven Delhi compression in Q2, and sustained international demand recovery through the Oct-Mar peak season.