Clarks/ANK&Pride M&A noise faded.

First of all, congratulations on a good set of numbers. Just to understand, we have a 9% RevPAR growth. Can you get a sense of like contribution of ARR growth/occupancy?

We have given that, Shaleen, this time as we had promised in several calls, by brand and because there is RevPAR growth and RevPAR growth which is very different in mid-scale and at what base we are talking about. Firstly, let me go by brand. At Taj is at 8% at a base of 22,000. In Vivanta, SeleQtions and Gateway is 10% and in Ginger is also around 9%. So, the majority of the growth is coming driven by average room rate which if we take everything together comes to 7% which accounts for the 9% RevPAR growth. So, 7% is ARR growth.

Got it, sir. If I can ask, how is the 4Q going on in terms of RevPAR? Any sense on that?

You see, I personally prefer to talk about RevPAR but I know that we always get the same question on RevPAR. I think it would be fair to assume anything in a similar trend or even higher is definitely not lower. So, it would be fair to assume approximately a double digit growth number. If not, then it could be 9, it could be 8.8 but I think with a bit of tailwind that we are currently having, we could get anything between 9% to 10% RevPAR growth but definitely you should expect a total revenue growth in a similar range as you have experienced in the past. So, I would say 12% to 14% in Q4 as a topline growth is realistic.

Okay. So, you think RevPAR growth of...till now we are seeing double digit, RevPAR growth, you said that?

So, I was just saying that till now, Quarter-to-date is actually comfortably in double digit. We will see how the quarter plays out and because we have, I think, big events lined up in the next couple of weeks. So, we will see how the quarter in February month plays out.

Sure. Got it, sir. Just changing towards strategy, I would really like to hear about Atmantan. So, few questions around it. Any sense of its positioning in terms of what are the key 25:01 ___ it has and in terms of your expansion plan, what kind of a CAPEX are you thinking you will be needing? Does it need a bigger CAPEX or a small CAPEX, multiple location, etc.? And in terms of the returns and margins, if we can get some sense of that because I think that could be a big sector going forward. So, if you can give some color on that bit?

In the short term, which when I say short term, I think the next three years or so, we expect to grow Atmantan with the founders in a hybrid fashion. I don't think we will have all growth coming through own. There is a lot of interest in Atmantan brand. So, if we did, let's say 4 projects, at least 2 would be on a capital light model and 2 could be owned by us. We would definitely want to have one additional asset in the west and a minimum of one in Kerala. That takes us to three and another one in South in the area of Hyderabad because it has a lot of demand there and very, very affluent base and maybe one in the north or in the east, I mean in the hill areas. But the order of priority would be like this, the west and Kerala being top priority followed by the others. That's our three-year plan. Ankur Dalwani: Just to add with the margins, we kind of disclosed the six-monthly margins when we did the announcement. So, they are comfortably above 40% and for the full year, we expected to be in high 40s only.

Okay, sir. Just one last bit on that. What kind of CAPEX per project we need and how big are these projects?

These are typically 25 to 35-acre kind of projects. So, large land areas located outside cities, close to a big airport because a lot of clientele is also offshore from foreign NRI clients or just foreigners. So, you do need connectivity and then of course, the location has to be in a place where you can actually benefit from the whole wellness angle. So, whether it's near overlooking a mountain or a beach or close to a river. So, those are the typical locations. So, legal locations, high end and it's not actually CAPEX per room kind of a metric here because it's also how many wellness slots you sort of put in, how many treatment rooms you put in and what kind of medical facilities you put in. This as you know is an acquired facility medically. It's a combination of all of those things which goes into CAPEX.

Good evening, sir. My first question is on your reported margins. So, we have like stable margins year-on-year. There's a mention of some one-off expenses during the quarter in your slides. Can you quantify this one-off number and impact on the margins with that?

Should be around INR 20 crores to INR 25 crores, Prateek. Of course, we are on a, we have been on a journey of acquisitions. It obviously increases legal expenses. It increases technical expenses. It includes deal expenses, due diligence expenses. These are some of the one-offs and some others are related to GST. Ankur Dalwani: No, I think that are the big heads. GST particularly has been an expense which we think will neutralize in the next quarter. So, that will probably explain half of the impact. And then the deal expenses and some related to the marketing events which happened one-off in this quarter. So, I think all put together will be in the INR 20 crores-INR 25 crores zone. Adjusted for those, the margin would have been higher and the growth in EBITDA would be at least a couple of percentage higher.

Sure. Moving on to other question, how are you looking at the New York asset now? There was like some news recent, I mean, a few months back, you are looking to exit that location. What is the update there?

Do not believe everything that is written. There is a very famous saying, you never eat as hot as it is cooked. We are very much there. We are operating it, the New York asset for the first time since we have it in the month of December crossed INR 100 crores in revenue. And we are for the first time in a lucky situation of cash profit. Even San Francisco has done well. You will see that in the details. It is very iconic Fifth Avenue. We would like to keep it. We are in negotiations. We would know more maybe by the next quarter call that we have as to where we stand. But definitely exit is not our preferred option. Ankur Dalwani: Also, we have clarified that that was basically the news, which was not true when that came out, in the sense that basically we said that we will get X billion dollars of money because we are not the owners of the asset. We have a lease right on the asset. So, that is what we are engaging with the owners of the asset.

Hi. Good evening. Thanks for taking my questions. Firstly, Puneet, you spoke about Taj Bandstand. On slide 15, if I look at the revenue potential of the asset, is it safe to assume that you are building an ARR of around 38,000 to 40,000 at 78% to 80% occupancy at the time of stabilization? And can you reiterate the timelines for first year of stabilization? And when you are building these numbers, what kind of ARR growth are you pencilling in here over, let's say, next 5 years to 7 years by when the asset should stabilize?

Both on occupancy and rate, you could go marginally higher. And the year of stabilization should, in such an asset, it does not take more than 3 years to stabilize. It all depends if you are able to complete by 30 or 29 or 31. It is very difficult to say that today because we are building a 164-meter tall building and a part of the construction is in water. You know, there are things that happen in terms of climate and other things which are beyond anybody's reasonable control. So, we do believe that given our experience of Taj Mahal Palace in Colaba and the kind of revenue it already does today, in 7 years from now, we could have the same base as that what we have guided for which is INR 1,000 crores plus as the revenue base for the full year of revenue. So, I mean, for the first full year of revenue and may be going up 10% year-on-year to a higher number by the 7th year from now, which means 4.5 years to build and another 3 to operate.

Sure, this is helpful. Secondly, just shifting gears to this quarter, given that this was the first quarter after quite a while where the growth was entirely like-for-like. So, is the 11%-12% consolidated revenue growth something you expect to remain largely constant going ahead into 4Q and FY'27 as well? And in the past, you used to talk about double-digit RevPAR growth and now double-digit revenue growth. So, are you now seeing the rate growth cycle close to peaking, especially given that even for Taj, the RevPAR growth was around 8%?

That is not accurate. We said we still talk about very high RevPAR growth. That's why we said we will start guiding by brand and that's what we have tried to do it this time. The growth is there and the growth is very robust. We feel, as I said during my opening remarks, 12% to 14% growth going forward, of which maybe I can repeat only 8.5% to 9.5% comes through RevPAR. A lot of growth will come from not like-for-like growth if you are going to open 60 hotels and some of the growth will obviously come from F&B and other revenue sources that we have. Given the kind of base that we have, Karan, if we get to 12%-14% growth, our flow-throughs can be very high. We had certain costs because if in a period of 3-4 months, you acquire a few companies, then the due diligence costs, the travel costs, the legal costs, all these fees go up by a significant amount. We expect all this to settle down by this quarter, which is the Q4 and we will continue our growth journey.

Thanks for taking my questions. So, basically, first of all, sorry, I joined a bit late. So, kindly excuse me if you already answered the question. First question, I want to understand what happened to your management fee. I mean, in the 3rd Quarter management fee, actually, the growth was slowed and what you reported in 1st Quarter and 2nd Quarter, what's happening there? And secondly, just to ask one-by-one, how do you see your wellness entrance now? And are you sort of intent to grow there? How do you see the wellness overall in the country doing?

Yeah, I think the management fee for the quarter was about 15% growth, which is in line with our expectations. I think you know what happens when you look at from a quarter-to-quarter perspective, there are incentives move from one quarter to another quarter depending on the performance, the incentive fee. But if you look at our guidance on the next year's outlook, I think which is more relevant, I think is you can see that we should end the year with a close to 18% growth on a YOY basis and the next year should be similar. That's what we are guiding towards high teens growth on the management fee given the strong pipeline of openings with large portion coming up in the first half. And that should really add to the management fee growth plus the fact that whatever is open will stabilize and you will have RefPAR expansion in the new hotels, which kind of get to higher occupancy as they stabilize.

And on the wellness side, please?

On the wellness side, like we mentioned earlier, I think we just closed the transaction, you know, just about three weeks, four weeks back. So we are obviously excited with the partnership, because it's an ideal fit from our luxury positioning. There is definitely a very strong interest to do add more Atmantan. This is not going to be a brand which get to like 100 Atmantan, but definitely over the next 2030, actually 2030, we should be looking at having 3 to 5 more Atmantan. And that's the plan we will actually work on with the management team in the next couple of quarters, put the strategy together for Atmantan. But you know, organically itself, there is growth opportunity in the current asset, which will add both rooms and wellness lots in the next financial year, and take the revenues close to about INR 100 crores in the coming year. So, that should give us good growth. And plus the margins for this business are very high. So this is typically a north of 40%-45% kind of margin.

Thank you for the opportunity. Just a quick question on the international RevPAR performance. Of course, last quarter also it was stronger. This quarter again, also showing up in the margin performance for the US and UK entities. How much of it do you think is currency driven? Is that a significant tailwind here? Are you seeing structural improvement in demand in these markets? And what kind of revenue you expect in terms of--

Very good question, because it's very interesting. You know, a year and a half ago, six weeks ago everyone had written off San Francisco. And it's coming back. It's not at the same level as its peak used to be. But it's backed by 75%-80% and the challenges of that market have, you know, kind of subsided. And there's a lot of improvement. So our RevPAR improvement in San Francisco, in Q3 is 50% versus the previous year. But the base had gone down so much that that 50% is good to have, but should have been maybe 60% or 70%. So we expect that increase to happen. New York, for us, has started doing much better than ever was the case for as long as anybody follows us. For the last 5-6 quarters, New York has improved both in topline as well as in bottomline. Cape Town is doing very well. One asset where we had the similar situation, even now as we speak, is London. We have invested significant amount of money in London. So as we speak today, the banqueting facility, the lobby, the lobby bar, the lounges, they are all under renovation and some rooms also.

Understood. Thank you for all the details. But how much of it is currently driven that you have seen in this quarter specifically? And would it mean that we can see growth from these businesses, inch up even higher in terms of RevPAR in the next 2-3 quarters, maybe even go up to mid-teens hotel RevPAR growth?

So on the currency front, it would be about 1.5% to 2% impact benefit of that, which flowed to the consolidated numbers on account, 1.5% on the RevPAR of these hotels, not on the overall numbers. So if this was 10%, basically it was 8% in local currency, it should have been 10% reported.

That's very helpful. So just on the domestic side, then would it be fair to say that the kind of 7%-8% RevPAR growth is something that is going to be a more normal trend going ahead for the next couple of years? Or do you see any room for further expansion there?

You know, I have been saying it, I think, whether it's, I have said it many times, I say it again, anything between 8.5% to 10% over our portfolio is realistic. That's one. But for us, more important is the not-like-for-like growth. We could be doing over the next year, at least 40 new hotels, which are not part of ANK, Pride or other portfolio, which will come on top. So I think our, that percentage growth, plus F&B growth, plus spa, plus chambers, I think should definitely give us anything between 12% to 14% topline growth. RevPAR is only one metrics. And also in India, it is much lower.

Yes, thank you very much. A couple of questions. First is, Puneet, you were talking about 12% to 14% revenue growth for the 4th Quarter. Did you, that it should, that 12% to 14% should continue into the next year as well?

Absolutely, yes.

That includes the 300 crores of acquisitions, correct?

That includes that. Not like, for like, growth is an important component of our.

Right, absolutely. The second question is, can you talk about the renovations that you undertook at some pretty marquee properties? What's the experience been? How much increase in ARR or occupancy are you seeing that you can attribute to the renovations? And if you can also tell us if, if you have other renovations planned through this year or how much of a visibility you have that will at least help us at least understand to model it out?

We are planning to spend approximately, we have guided on that before also, approximately INR 1,000 crores in CAPEX, which includes routine and new, and also renovation or expansion. For example, we have done the Taj Mahal Palace in Colaba, the Chambers, or we did the new restaurant Loya. We are going to do an Italian out there. We just finished the two floors in Taj Palace. The rates have almost doubled versus two years ago. So, post renovation, not just of the renovated rooms, but of the entire hotel. So, it's pushed the entire hotel ahead. Same things we have noticed in London, in terms of first comes displacement, but then comes the other moneys. Mansingh is a very good example. Mansingh, despite 89% increase in rent and INR 250 crores in renovation, it actually makes more money on absolute amount now than it ever made when the rent was only 17.25%, that's Taj Mahal Delhi. And our Chambers membership fees has increased 5x in last eight years and is going to double very soon.

Got it. Okay. That makes sense. Just one final question. How about CAPEX? You gave us a number for this year. Has that number changed for, let's say the next 3 years-5 years, or is still as going as per plan?

I think for, we can only talk about next year, because we have more visibility on that. But broadly speaking, I think it will be in a similar zone as what we are going to do this year. So, maybe plus percent, (+/-5%) to (+/-10%). That's what we think we will end up doing in cash flow, cash out for next year on CAPEX. I think long term, it could move up a little bit in, let's say, 2-3 years from now, as the Bandstand project starts to scale up. So, I think that's what it will be. But I think the good thing is that our operating cash flows are far ahead of these numbers. So, we will not have any problem of funding these capital expenditures.