Hospitality chain EIH Ltd that runs hotels and resorts under Oberoi and Trident brands today reported 40 per cent decline in standalone net profit for the fourth quarter ended March 31, 2013 at Rs 27.04 crore hit by overall downturn in economy.
The company had posted net profit of Rs 45.13 crore in the same quarter previous fiscal, EIH Ltd said in a statement.
Total income during the quarter under review stood at Rs Rs 352.62 crore as against Rs 331.31 crore in the same period a year ago.
The board of the company has recommended a dividend at 90 paise per equity share, it added.
For the year 2012-13, the company said its consolidated net profit was down to Rs 41.77 crore from Rs 122.31 crore in the previous fiscal.
Commenting on the results, EIH Vice Chairman and Chief Executive Officer, SS Mukherji said company’s performance was impacted by the overall downturn in global and domestic economic growth.
“The performance of the hotel industry is directly connected with global and domestic economic growth. The global economic growth rate reduced to 3.5 per cent in 2012 compared with 4 per cent in 2011,” he said.
The situation in India mirrored this global trend.
“India’s growth rate fell to 5.5 per cent driven by lower industrial production in core sectors, slow internal investment, reduced urban consumption and high inflation,” Mukherji added.
On the outlook, he said: “The long term confidence on the Indian hospitality industry is however positive”.
EIH said its new hotel Trident, Hyderabad consisting of 326 rooms is scheduled to open in June 2013. The company will manage the hotel.
Another property under the Oberoi brand will be opened in Dubai in June this year. It will have 252 rooms and will be managed by a wholly-owned subsidiary, the company said.
Shares of EIH Ltd ended the day at Rs 58.05 per scrip, down 0.17 per cent from the previous close on the BSE.