EIH Ltd, flagship of the Oberoi Group, has bucked the prevailing downturn in the hospitality sector by cornering a larger share of the market.
Addressing a press conference on Tuesday, Executive Chairman P.R.S. Oberoi said that in the past several quarters, EIH had gained a bigger share of tourist traffic and cut wastage.
Announcing its results for the first quarter of financial year 2013-14, EIH reported an 11.64 per cent growth in net profit to Rs 10.55 crore, on a total income of Rs 271.16 crore (Rs 246.03 crore).
“In Q1 of FY14, we clocked an occupancy rate of 57 per cent against 49 per cent in Q1 of FY13. The FY13 average occupancy was 65 per cent,” said EIH Vice-Chairman and CEO S.S. Mukherjee. In comparison, he added, the domestic industry’s occupancy rate was between 45 per cent and 50 per cent.
Mukherjee said that the company’s Q1 revenue per available room (RevPAR), a key performance metric in the hotel industry, improved by nine per cent, while the industry’s indicator declined by seven per cent.
RevPAR is calculated by multiplying a hotel's average daily rate by its occupancy rate. It may also be calculated by dividing a hotel's total guestroom revenue by the room count and the number of days in the period being measured.
The average room rent of Rs 5,350 did not see much change but the company brought in bigger business volumes through new marketing efforts, said Mukherjee.
For FY14, the hospitality chain has planned capital expenditure of around Rs 80 crore for renovation of properties in Bangalore and Mumbai.