Kamat Hotels (India) Limited (KAMATHOTEL.NS) Q3 FY2026 Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Q3 and 9 Months FY '26 Conference Call of Kamat Hotels (India) Limited. [Operator Instructions] Please note that this conference is being recorded. I would now like to hand the conference over to Ms. Purvangi Jain from Valorem Advisors. Thank you, and over to you, ma'am.

Good afternoon, everyone, and a very warm welcome to you all. My name is Purvangi Jain from Valorem Advisors. We represent the Investor Relations of Kamat Hotels (India) Limited. On behalf of the company and Valorem Advisors, I would like to thank you all for participating in the company's earnings conference call for the third quarter and 9 months of the financial year 2026. Before we begin, let me mention a short cautionary statement. Some of the statements made in today's earnings call may be forward-looking in nature. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ from those anticipated. Such statements are based on management's belief as well as assumptions made by and information currently available to the management. Audiences are cautioned not to place any undue reliance on these forward-looking statements in making any investment decisions. The purpose of today's earnings call is purely to educate and bring awareness about the company's fundamental business and financial quarter under review. Let me now introduce you to the management participating with us in today's earnings call and hand it over to them for their opening remarks. We have with us Mr. Vishal Vithal Kamat, Executive Director; and Mrs. Smita Nanda, Chief Financial Officer of the company. Without any delay, I request Mr. Vishal Kamat to start with his opening remarks. Thank you, and over to you, sir.

[Foreign Language], everyone. Thank you, Purvangi. I welcome you all to the earnings call to discuss the third quarter and the 9 months of the financial year 2026. Overall, the results, along with a comprehensive presentation, has already been made available to you all. I believe many of you would have gone through that. So I thank you all for taking this time to join us today. We saw the third quarter have a comparatively stronger recovery compared to the H1 of the year. We saw that the -- especially November was an exceedingly fantastic month, particularly because this time, the entire holiday season either was in the month of October or December. So November was extremely good, and the same buoyancy we could see. Regardless of various aspects, we could see overall that the buoyancy was there in many of our hotels in the Q3. The broader hospitality sector also experienced various volatilities from aviation disruption that definitely affected us. Otherwise, it would have been even better. There were large-scale challenges, which everyone is aware of, especially in the leisure segments, particularly where people had to cancel or got stranded and various aspects were there. So there was definitely a lot of volatility in terms of the aviation sector, which was hand in glove with us. Apart from that, various other aspects which were already covered in our H1 -- in our Q1, Q2, basically like Operation Sindoor and other things, or the crashing of the Air India, which all had subsequent indirect or direct effects with us. So -- but that said, Q3 was a good quarter where, apart from this one-off thing, nothing major happened, and that's why it was a good quarter 3. Looking ahead, we are, in the coming calendar year, very happy that some of the things which have got delayed will open. One of the main things we were banking on like Dehradun, Gwalior and Bhavnagar and Orchid Nashik -- all these we were banking on to open earlier than expected as per the thing. But unfortunately, they have got delayed, but they are all going to open. Approximately 280 to 290 rooms of these cumulative will open in the coming calendar -- coming annual year. These additions will make a definite strength because we've opened the Rishikesh -- the Orchid Rishikesh, Rishivan, and Dehradun will help that along with other such presence. Additionally, we also saw a lot of initiatives announced. Union budget -- government has again given some of their inputs to the industry. They've also supported by way of certain skill development. While these don't have a direct impact, they indirectly have an impact on our business, which is a good thing. So there has been buoyancy and government is spending also in various programs, events, infra-related events or tourism-related events or various other kind of things. So government is spending. Along with that, corporate demand is still sustaining good. So that's something which is -- we are seeing also in the coming quarters also, and as you have seen in the past quarter. We remain focused on basically driving more efficiency. While there have been some figures which have come down, that also will explain why it is there. We are continuing to focus on our semi-asset-light approach and our quality-driven approach. So while we have not opened up a lot of hotels, whichever hotel has been opening is getting an excellent response. The hotels are being received extremely well. And then once they're picking up, they are giving very good returns in the -- both satisfaction level and in terms of the revenue level -- EBITDA level. So that's something also we are continuing to focus on. I think I'll answer more detailed questions, obviously, later on. So I'll hand it over to Smitaji, our CFO, who will now take you guys through the brief quarter figures, and we can share the details once we are ahead. Thank you, [Foreign Language].

Thank you, sir. [Foreign Language], and good afternoon, everyone. I'll briefly touch upon the key performance highlights of the third quarter and 9 months of the financial year 2026. On a consolidated basis, the revenue for the third quarter stood at INR 118 crores, representing the increase of approximately 12% year-on-year basis. EBITDA for the quarter was INR 39 crores with the EBITDA margin of INR 33.14 crores (sic) [33.14%]. And the profit after tax level, the company reported profit INR 19 crores compared to the profit of INR 26 crores in corresponding quarter of the previous year, with PAT margin of 16.23%. For the 9 months of the financial year 2026, consolidated revenue stood at INR 276 crores, which was an increase of approximately 4% year-on-year basis. EBITDA stood at INR 65 crores with the EBITDA margin at 23.56%. PAT for the year stood at INR 21 crores, translating to the net margin of 7.66%. With this, I conclude my remarks and request to the moderator to open the floor for the question-and-answer session. Thank you.

[Operator Instructions] Our first question comes from the line of Gunit Singh from Counter Cyclical PMS.

So the results for Q3 have been somewhat disappointing because our total number of keys increased by about 30%, 32% if we compare Q3 last year to Q3 this year, but revenues have mainly increased by about 10%, 12%. So can you help me understand, I mean, has the offtake of new hotels been slow or have the existing older hotels not been performing up to the past? I mean, how can we understand this discrepancy?

So that's a very good question, and I'll share with you. Basically, it's a blend of both. Firstly, the last year, we had certain hotels, which did over-exceedingly well, like for the case of Ayodhya, because we had the entire Maha Kumbh. So for 45 days, at that time, we were chock-a-block, full, doing a certain ADR, INR 12,000, INR 15,000, whereby the hotel also was in off-season time type. And yet, at that time, that was the season based on which it did exceedingly well. After the Kumbh Mela, there was a sudden drop because many people had just visited. Apart from that also, there was a heavy summer because of which, again, people were not traveling. Add to that, that leisure travel basically dried up from May onwards due to the Operation Sindoor and other aspects. So a good -- almost a month after that, depending on place to place, a lot of the leisure business basically dried up. So that is basically one example of where the business last year was great, and this year, it was not good as compared to last year. Then after the summer season, that is the last few months, the entire hotel has again picked up. And now it is doing what it's supposed to do, which is reasonably well, good occupancy, which is in the high 90s. While the occupancy is in the high 90s, ARR also is reasonable where it's a win-win between the traveler and the hotel both. Otherwise, it was skewed towards the -- against the traveler with a very high ARR, but that was the market at the time. Similarly, this time also, we have been very badly affected due to our Shimla, Manali hotel because of the road condition, the roads which had flooded and washed away. Especially Manali particularly was even more longer affected, and we faced this problem, which is the second year in a row we are facing for which basically we are a little disappointed overall that Manani, Shimla, which before that used to do exceedingly well, last couple of years has been hit back to back with the bad roads, which, again, everyone knows this thing. I'm not talking about the recent kind of what hearing we do when snow and all comes. That's okay. That doesn't affect us that much because people already check into a hotel and the hotel is full. But this I'm talking about where the roads only were washed away, and people could not go for almost like 3 months. Even our own staff who were on leave and all we had to adjust them elsewhere. So that was one side. But the other side also has basically been that we have various aspects which have happened and our hotels being mature -- many of our hotels being in a mature place like our Orchid Mumbai, or IRA Mumbai, there is only that much growth that those particular hotels offer. So when we look at the blend of the basket, it has not been extremely high. But coming to an example of, say, Orchid Pune, where we have been spending money on our renovation -- and we see the uptick. Already, it's been just 20 days that we have seen in terms of our renovation being complete of our first phase and the ARR from around INR 5,500, INR 5,700 has shot up to INR 6,500, INR 6,700, INR 6,400 on an average. So that growth we have seen already in this season itself, which we were not even expecting it to have that quick an impact. So coming year, we see that Orchid Pune will do exceedingly well where we have renovated, and we expect that it should literally do a fantastic sale. So what we have seen right now is not -- and thirdly, many of the new hotels, which were to add on, for example, Dehradun was to open around 9 months back. Unfortunately, it is delayed. We have to depend on our owners. While the owners are good people, they have to get certain things done, and we as a brand have to get it from them. So whether it is in Gwalior, which should have already opened by now, whether it is Dehradun, which should have already opened by now, Nashik also should have been close to opening, if not opened by now, so we find that -- Bhavnagar again, should have opened by now, but then there was that fire in Rajkot because of which their entire project got delayed. So while it is not pinching us in terms of our interest outgo or CapEx investment stuff, it is pinching us that there are some people we have taken, some employees we have taken, certain CapEx we have done, which CapEx basically is the -- or there is an OpEx which is going on, which basically adds to our burden. It's not a very big burden in the -- when you compare to the project size. But in our own way and in our own thing, considering it's supposed to be an asset-light, it does pinch us that we have to take sometimes some people and retain them for longer than we expect. So these are some of the 3 challenges which have come together this time for us to basically see that this has not had that kind of growth, which should have been there as per what I agree with you. So that is basically the thing, sir.

Sir, if you look at the hotels which opened up within the last 12 months, I mean is it possible to share the revenues from them? And if I'm not wrong, we would possibly be making EBITDA losses for them because -- I mean, correct me if I'm wrong.

No, no, you're absolutely correct. I'll give you an example of, say -- take the case of Jamnagar. It will complete 2 years now in the month of February, okay? That is -- it will complete 2 years. And in the first year, it did a heavy loss. We had almost INR 1.5 crores because one of the practices what we do is basically we also book our all expenses, which were there in opening in part of the OpEx. This is something which we've been following, and we are consistent with that, that rather than capitalize that initial opening INR 50 lakhs, INR 75 lakh, whatever maybe, depending on the hotel to hotel, rather than capitalize that, we basically put it in the OpEx and expense it out so that from day 1, the pressure is on the General Manager to perform. And what we saw last year was almost INR 1 crore, INR 1.5 crores [Foreign Language], INR 1.35 crores, INR 1.50 crores [Foreign Language] would be the overall expenses. And yet -- and that was a loss that was there last year. But this year, it will close at a decent profit. Why? Because all that burden of the past being absorbed and the current -- this thing, so it will have a profit. Same way Chandigarh. Chandigarh started off with a heavy loss because it started in April. That time, there was a lot of challenges in April in terms of the -- this thing, what do you call? There was a lot of -- the Operation Sindoor happening. So the entire Chandigarh airport was shut from May till a good amount of time. And that being a gateway for us to our Shimla, Manali hotels, there was no possible people traveling after that also. And by then what happened, by the time the airport opened up by end of May, we found that a lot of the guests who would have ideally gone north for their holiday to the cooler climate basically all went towards the...

Ladies and gentlemen, the line for the management has dropped. Please stay online while I get them connected. Ladies and gentlemen, the line for the management is reconnected. Please go ahead, sir.

Yes. Sorry. So as I was telling you, sir, basically, [Foreign Language] so considering that these are all basically now whatever EBITDA expenses they are, they will not recur next year. So next year, like the example I give you of Jamnagar where it was a thing and would have affected, so what happens is one advantage is that we get a true picture of our operations and we get a true picture of the cash in hand literally as good as, rather than anything. And what happens [Foreign Language] So overall, what we find is the comfort that we have as an operator that, yes, we know where our clear picture stands, what is it that has actually cost us and how we will recover it in the coming future. So that is basically one of the things. So I was telling you about Chandigarh. Chandigarh, for the first 6 months, struggled. It was in a heavy loss. But last 4 months, it has done exceedingly well, whereby it's the first year of its own self and yet it did exceedingly well in terms of like -- I mean, even now in Chandigarh, we are sitting last 5 -- [Foreign Language] till 11th of this month, we'll be sitting at 98% occupancy, so last 11 days -- or this entire -- from the, I think, 20-something end of this month. Why is that the case? Basically, it is the case because, touch wood, our brand has got established well over there. Technically, we are new for the Chandigarh market. We may be in hospitality in other parts of India for all these years. It does not matter. What matters is that in Chandigarh, we were new. And yet, in such a time, we are over there doing extremely well, whereby our losses have been covered up. And I think by the year-ending, whatever the heavy losses which were there of the first 6 months, 7 months will be covered over comfortably by the next 4 to 5 months. So by next year, it will be pure EBITDA based on our -- also whatever investment we've done and recovery of that. So it's about a cycle. And we are patient with the cycle because I don't want to change what practice we have already been doing. This practice started off in corona, and it worked very well for us because it allowed us to basically manage our cash very well as compared to looking P&L nice and then cash flow management being an issue. So that's basically the reason. So in the coming quarters, in the coming years, you will only find this being better and these delays which are there being overcome.

Got it, sir. Great to hear that. So sir, can we quantify from the new 500 keys or new hotels, how much of EBITDA loss, for example, we would be making in FY '26, which might not carry forward in FY '27, number one? And number two, we have some more keys coming up, about 600, I think, in the coming FY '27. So what would be the total amount of expenses related to that, which might come up in the P&L in FY '27, these 2 things?

So what I'll do, sir, is basically, I've noted these two questions down. Okay? Since you already asked a couple of questions, I think let's go to others, and I'll come back to you, which I'm sure will be better.

[Operator Instructions] The next question comes from the line of [ Ronit Kapoor ] from [ Investaya Investments ].

[Technical Difficulty]

I'm sorry to interrupt. [ Ronit, ] you you're not audible. Could you please use your handset mode in case if you're on hands-free?

[Technical Difficulty]

You are still not audible, [ Ronit ].

Yes. Am I audible right now?

Yes, yes. Please go ahead.

Yes. So firstly, I wanted to understand, a lot of supply has come around the Andheri, Vile Parle area in the last 6, 8 months, like around 1,000-plus rooms. So I want to understand how is the supply affecting IRA, Orchid and Orchid Mumbai in terms of ARR and overall revenue?

That's a very good question. The supply is not actually 1,000 rooms. The supply is much more than that. The supply is anywhere close to 2,500 rooms if you put together -- the small and big all put together. And I'm considering all but the giants, which -- brands and even small brands, it would be around 2,000, 2,500 [Foreign Language], okay? So firstly, that's a very good question because particularly our hotel Orchid and all is definitely one of the biggest part of our revenue. So what we see and what have we discussed before also, and I've been very candid about this, is that there will come a systematic plateauing of the ADR, which is the average room rate, but the occupancy is still buoyant. So Mumbai as a destination is still buoyant. Mumbai as a destination is still in demand because it is ideal to do your events, MICE, and it's still a good gateway city. And Navi Mumbai Airport will further add value to that. But ADRs which are there will start plateauing, will start to recede though we've had an ADR growth in this season. In the future, the occupancies will remain. ARRs will kind of -- they will not fall. They will not fall, but they will not grow as what people were expecting them to. They will kind of plateau. But that is in the future. Right now, we are not seeing that. I think next year also, we'll find a lot of buoyancy because of also one more thing. Thanks to Jio Convention Center and NESCO, Mumbai has moved into the next year of a MICE destination. Had these convention centers not been there, we would have struggled. That is why in the past also, we have always been looking forward to Jio coming up because Jio, NESCO -- in fact, Mumbai needs a couple of more bigger-than-Jio kind of places, then it will thrive even more. So that's basically the reason that while the inventories have come in, they have not affected us negatively, and it won't get affected negatively because luckily Mumbai has got insulated, thanks to Navi Mumbai Airport 2 coming, thanks to Jio, thanks to NESCO and overall hotels having large banqueting facilities.

Okay. And secondly, like [Technical Difficulty]

[ Ronit ], you're not audible again. [ Ronit ]?

Yes. Is it better now? Am I audible?

Yes, yes.

Secondly, I wanted to understand this lease dispute [Technical Difficulty]. You have provided...

Your audio is distorted again.

Hello? Is it better?

Yes, yes.

Yes. So this Pune property, this dispute regarding the lease around INR 21 crores, which the company has already provided for, I want to know like when do you expect it to resolve.

So there is -- it is basically a matter which would get resolved soon because it is an error from the government side, okay, which earlier they were -- there was basically a lot of ambiguity. And after that corona came. And now there is some stability and there are people willing to listen and sit through it. So I think that this matter should get resolved very soon. This provisioning, which we've done is based on basically that this is the maximum we may have to pay if we have to pay. So it's not necessary that this figure is there. It might be lesser, it might be INR 21 crores. So basically, this is a matter where the government had to give us certain things, which they have not given us at that particular time, okay? But we are willing to sit down and compromise in a positive fashion. And I think it's a matter of time that, that should get resolved. But it does not, in any way, jeopardize our existence over there. It does not in any way create any situation in which we are not in a position to operate. It is only a matter of a technical point, but it is not having any bearing on our operational or otherwise.

Okay. And [Technical Difficulty]

I actually cannot make out what you said, sir. May I suggest you come back? That would be helpful, because I couldn't get your third question. And I think two, sir, I have answered. So I'll just take some more and then come back to you, sir.

The next question comes from the line of Niraj Mansingka from White Pine Investment Management.

I just had one question on -- see, if you have Dehradun, Gwalior, Nashik and Bhavnagar starting in FY '27 and you ended up spending INR 1 crore plus in the Jamnagar after the starting, are you expecting around between INR 4 crores and INR 6 crores extra expenses coming in FY '27?

So in '27, some of them which are opening -- like Gwalior will open -- not in '27, but end of this year, I think -- what have we given?

Gwalior we have given '27.

'27, we had?

Yes. We have given '27 September.

Probably in March '26, you said in the presentation.

So, in the presentation, March '26 [Foreign Language] What is that?

Currently '26, including Gwalior. Gwalior is in '26.

Anyway, Mr. Mansingka, I think basically your point is very valid. So we will not have so much of -- again, it's because it's hotel to hotel dependent. Now what happens sometimes, in some hotels, where we feel that the hotel is going to open, we tend to take the staff. And then accordingly, we have a staff outgo, accommodation, food, then we'll have already the uniforms and other things, which are CapEx already done, which would have been done -- if the hotel was to open, say, 4, 5 months later, we would have done it later. But unfortunately, that, at that time, is done and that CapEx outflow is there. That is also basically the reason why we take it as part of the OpEx and not capitalize it. Then there is a lot of flights or trains or travel or there is digital social media. Today, social media cost is one of the big costs, so we have -- before the hotel opens -- a few months. Now if -- what happens, we do all this planning based on 3 months or 4 months before it opening. But sometimes because of owners or because of circumstances or because of whatever reasons, it becomes 6 months, 7 months, then we basically have that burden of the expenses. So you can say [Foreign Language] that on an average, it costs us around anywhere between, the size of the hotel dependent, INR 60 lakhs to INR 75 lakhs minimum for a hotel for preopening if it is a leased or a revenue share property. If it is a management property, it is not that much, then it is in -- maybe about INR 20 lakh odd.

Okay. So what will be the -- what is your estimate of the expenses incurred on these 4 hotels in FY '27, which is not -- which is reporting EBITDA losses from these hotels?

So [Foreign Language] you can take -- Smita [Foreign Language]...

INR 1.5 crores.

So around -- [Foreign Language] for all these put together. [Foreign Language] because not all of them are very big. [Foreign Language] But then again, [Foreign Language] like example, this year we have spent on Rishikesh. This year we have spent on Panchgani. This year we have spent on these various hotels, which will not be there next year. Next year, they will not have this, so we'll be 0 or rather we'll be profit actually. So those expenses will be not there. So that time, that EBITDA will grow and this will get offset.

Got it. So basically, 2 hotels we started in FY '26, which is Rishikesh and Panchgani, those expenses will become profitable and...

Chandigarh also we -- Chandigarh also, sir, we opened this year.

Yes, Chandigarh also.

And Hyderabad. Chandigarh -- sir, Hyderabad, Chandigarh, IRA by Orchid, Hyderabad which is in a prime location in this -- Mindspace. That's a 63-room hotel, okay? Then we have IRA by Orchid [Foreign Language]. So these 4 have opened, sir. Now Rishivan got delayed by -- it was to open. It got delayed by 3, 4 -- over 7 months late. Again, we had to depend on the owner. He also had various challenges, Kavadiya and all that happened so that their walk and other things took time, furniture to come took time. So this is where when the delay happened, we had already our General Manager, a few of the HODs, all our other expenses in place. So those expenses already hit us. So that way. So that's one example I'm giving. Same thing with Hyderabad. Hyderabad also got delayed by 2 months. So that was [ a real thing ]. So there are already some things which are in rotation, and we have to just adjust according to that.

Got it. And what was the ARR for the Mumbai hotel, Orchid Mumbai, for the quarter average?

INR 7,400.

Which is lower than what -- INR 8,000, which it was a year back, right?

Yes. This year, our overall ARR was lower than last year. Last year [Foreign Language].

Last time [Foreign Language] INR 7,900.

INR 7,900. [Foreign Language]

INR 7,400.

INR 7,400.

Got it. And can you share the number for even which as well? Mumbai?

IRA.

IRA.

IRA you mean?

IRA Mumbai. Sorry, IRA Mumbai?

Yes, I'll just share with you. One second. IRA Mumbai was INR 6,825. This is -- this last year, for the few quarter which went. And prior to that was INR 6,050.

You have an improvement in IRA, but you had lower numbers on the Orchid.

Yes.

And what are the stories right now in terms of the ARR/ADRs? Are they higher Y-o-Y or are they lower Y-o-Y?

So in the case of Orchid Mumbai, we basically -- last year, we did 74%, okay? And this year, we did 80% for that quarter. So we basically this year went more for the [Foreign Language]. I'd like to -- please, I apologize. Our ARR last -- this quarter, which just went by, is INR 7,818. And last year was INR 7,165.

You are talking about Orchid Mumbai.

Sorry, Niraj ji. I'm talking about Orchid Mumbai. I'm just giving you correction. I'm sorry -- my error. We saw the wrong paper. Last year, we did INR 7,165 and occupancy was 74%. And this year, we have done INR 7,818 with an occupancy of 80%.

Got it. Then your revenue should be much higher, right?

So the revenue -- on a revenue basis, for the quarter [Foreign Language].

I got it.

The next question comes from the line of [ Viraj Shah ] from [ Tatvic Digital Analytics ].

Sir, my question is with regards to the occupancy rate. So for this quarter, for almost all the brands, the occupancy rates have risen. But still they are not at those levels of early quarters of FY '25. I just wanted to know, especially for Orchid, when can we expect those 65% of occupancies? And in this quarter, especially fourth quarter, are there any signs of us clocking 65% kind of number?

You're talking about, sir, overall YTD occupancy?

No, sir, for the specific quarter.

So, for the coming quarter?

Yes, for the fourth quarter and I was quoting -- putting the numbers for this quarter, FY '26 third quarter, the numbers are better than the second quarter, but they are still lagging in terms of -- if we compare it with the second quarter of FY '25. So those were around 77% occupancy in IRA, 66% in Orchid. So are we on track to achieve those kind of numbers back? Because there is some improvement vis-a-vis the last quarter, so I just wanted to check if, in fourth quarter, there is some improvement that you are seeing.

Yes, yes, there is an improvement. There will be an improvement also. This month of Jan has also been good, and we expect the month of Feb and March also to be good. So there will -- there should be an improvement, okay? Definitely.

Improvement, sir, compared to the 58% in Orchid that we clocked in third quarter, right?

Yes, possibly.

Okay. And sir, for Lotus and Fort Jadhav, do we expect to maintain the similar level of occupancy going ahead as we did in third quarter?

It should. It should. There's no reason for it. As of now, nothing seems that it should not. It should be. But definitely, in the case of -- considering that these 3 are leisure, March may be a little lower. So it may not be the full same to same. It might be a little dip because the March exam time is there -- March, April. And then from mid-April, it picks up. So I would not necessarily say it would be the same because the holiday season of October, November, December is not the same as Jan, Feb and March. So March can be a dip. So it may not be par-par, it will definitely be a little lower.

Yes, that's fine, sir. That's fine. And sir, for Orchid, last quarter, there were a few one-offs because -- in Manali and in Pune. So do we -- so those things were -- would kind of have mitigated in this quarter. So is there any other actual improvement in occupancy that has happened in Orchid if we remove the effect of one-offs in last quarter, second Q, that happened? So apart from that improvement, is there any tangible improvement in the occupancy that you have seen across the other cities?

Nothing in particular that comes to my mind right now. Overall, buoyancy has been there, so it has done what it has done. But nothing has -- nothing particular in my mind coming, which is there in particular.

Understood, sir. And sir, the...

Sir, we'll come back in line because you have got 4 questions. So I think let's just come back in line, if you don't mind, please.

The next question comes from the line of [ Aditya Varma ] from [ Synergy Investments ].

Am I audible?

Yes, yes.

Sir, this is -- when I compare our hotels' performance with other -- your peers, this has been a spectacular quarter for most of the hotel industry. And then our performance is definitely not at par. I understand -- I heard your reasons. And I have also visited a few of your properties. For example, I visited Lotus in Goa, Benaulim Beach. Sir, most of the Goa hotels are fully occupied. But our occupancy -- we have hardly any rooms which are being occupied. So at the ground level, are we performing this thing because unless and until our [ ARPO ] increases, our average room rate will not be -- we will not be able to improve our profits. So what are your comments on this?

Sir, you have visited Lotus. Firstly, sir, it has been renovated almost a year now since it is -- maybe about 8 months since it has just opened. Otherwise, it was closed. And it has been renovated into an Orchid hotel. And we, in fact, occupancy-wise, are doing exceedingly well, in fact. For the month of November, December, the average occupancies over there were in the high 90s. So when exactly did you go, sir, so I can just know myself?

Sir, this was around Diwali time. This was around Diwali. And I'll just tell you the reason, sir. See, first of all, Benaulim is not in the main Goa's area. Over there, the families are not allowed. The kids are not allowed and couples are allowed.

Yes, yes, kids are not allowed.

Yes, only couples are allowed. And that area is not such where couples visit very often.

No, no. I disagree with you. I think -- please, sir, let me correct you. I disagree with you. Please appreciate. We don't allow children over there because we do not have facilities for children. We don't have a play area. We don't have a park. We don't have anything which a family, if they come over there, we can offer. We don't even have extra bed in the room, sir. So when we don't have all these kind of facilities, then, sir, it becomes very difficult for us to basically cater. I'd rather make a person fully happy by giving the person what he expects. So what have we done, sir? What we have done is basically made this resort entirely and entirely for an audience who is a mature audience who does not require certain of these things. So we don't allow anybody under the age of 15, 1-5, firstly, sir. And that is our policy we have for that hotel. So that is the reason why the kind of -- sir, we are attracting 80% foreigners. We are attracting 80% foreigners. Let me tell you, sir, for example, in the month of -- just in the month of December, in the month of December, I'm just taking out the -- this thing because, since you mentioned it, I'll tell you even January also. One second. Just right now -- December. Sir, in the month of December, we have been doing an average ARR, sir, over there of INR 6,600 for just the month of December. And in the month of -- so the ARR-wise also, it has been doing very well because earlier when it was Lotus, we used to do an ARR of INR 3,000. And this is considering -- let me just tell you -- so basically, sir, touch wood, our hotel over there has been doing very well, and we don't allow children, particularly for that. Kamat, sir, is always known for its family-friendly places. But I'd rather be happy and give somebody something rather than try and make everyone happy and make everyone unhappy. So there, sir, we do definitely. You can go with your family to Orchid Rishivan, you can go to Fort JadhavGADH, you can go to Orchid Mumbai, IRA, everywhere. But at Orchid Passaros, we have decided to identify ourselves with an audience, and we get that kind of audience, the kind of people who we get is basically that. So in terms of our occupancy, in terms of our rates, in terms of the thing, we, touch wood, are doing good. In fact, Goa has seen a very big dip overall as a market. And in that also, considering it's a new product, it's not completed even 1 year, because after we converted Lotus into Orchid, it definitely -- initially first few months, there was obviously a gap. That's why I wanted to know. So when -- if you would have said that you had gone in the month of, say, June, July, definitely that time, the occupancy was very low. But from the last, whatever, 4 months of the thing, it has been doing exceedingly well because our marketing takes time. All -- as you -- one point, sir, which I'd like to agree with you and complement you is basically the point where you said about marketing. So we are investing a lot in marketing in terms of pushing for these other kind of different destinations, digital marketing, online marketing. And for that, we have our own sales office. We don't only depend on travel agents. We have our own sales team, sales office spread across India, which are basically there apart from basically relying on the online OTA because the commissions are also very high. 20% is the commission. So we basically are balancing that out. And wherever you would like to go with your family, sir, you can -- other than Orchid Passaros, wherever else, we'll be happy to please welcome you all with open arms because that's what we are here for, sir. So definitely, I think that this thing is there.

Got it, sir. And I'm -- being an investor with Kamat for long, so I always visit Kamat hotels only wherever I'm traveling. Just one more question, sir. Regarding the Manali and Shimla, even in the last con call, you had mentioned that there were disruption because of the road getting washed away. How about this quarter, sir? What is happening now? And what is the current situation? Are the hotels functioning and we can expect profitability from them now?

So the hotels are functioning, sir. Manali has started functioning. Shimla also was functioning, but the traction was quite low. We basically -- this year also, we find that overall YTD-wise, we are performing very well up to our expectation. Okay? So that is a fact. Shimla and Manali should have done better, but they have not done what we expect them to do. They are definitely a little strain on us. But I think in the long run, they will pay off in terms of Manali and Shimla.

The next question comes from the line of Gunit Singh from Counter Cyclical PMS.

Sir, so I would like to understand what was the utilization for the hotels, which came up in the last 12 months -- for Q3?

Yes, very good question. So basically, now in the case of -- [Foreign Language]. So in a short time, we have been -- [Foreign Language]. Basically, in a short time, we've been able to do quite well in terms of like, say, Hyderabad, where we -- for IRA, we are getting right now -- though we're just a few months old, it is, I think, our third month. So we have done an average ARR of around INR 6,269. And currently, we are at 48% occupancy for the last 3.5 months, which is not bad considering we have just started, and it will do also exceedingly well. In fact, both on the ARR front and occupancy front, definitely, we expect that, that hotel to close, on an average, at a 70%, 75% YTD, considering that's a 63 rooms hotel, it will be and it will be -- it will do very well. Then which other one is there?

Rishivan.

Rishivan, just opened. Rishivan has just opened. Rishivan has just opened. So there is nothing much to tell about. We basically -- Rishikesh is a destination where you have a lot of forward bookings. We already booked weddings for April -- sorry, for February, we have 2 weddings. We've done already one wedding, big wedding over there. So it's a forward booking, so it will come. Rishikesh has just opened last 2-odd months. So that is there. Then same like Panchgani also. Panchgani also in a short time has [Foreign Language].

Ladies and gentlemen, the line for the management has dropped. Please stay online while I get them connected. Ladies and gentlemen, the management has been reconnected. Please go ahead, sir.

So here also in Panchgani -- sorry to get disconnected. So here also, we just opened up now October, November, December, [Foreign Language] where we were about 26%, and we've done an ARR of around INR 6,500, which is good considering that we've just started. So that's how basically these new properties have been that though they are -- but the signs are very positive, and it's about coming years that we will do our full potential.

All right sir, generally, how long does it take to -- for a property to reach optimal utilization, say, about 70%?

6 to 9 months.

Timeline for optimal utilization according to you?

6 to 9 months is generally what is basically it takes, because of your all Google listing, other things and depending -- 6 to 9 months, it takes. In that, again, it depends on city to city, okay? In some cases, like Hyderabad will establish faster than a Rishivan or a Panchgani because they are leisure destinations. So leisure is lower, it takes longer and city hotels are a little faster, but naturally. So we basically -- this is how it works. The city hotels tend to do faster than business hotel -- these leisure destinations.

All right, sir. So you had given a guidance of INR 400 crores top line this year. So are we on track to reach that? Or what are your thoughts?

We might lose out by around 5% to 7%. We will see about that. Based on how this other -- this quarter goes, we would have plus/minus 5%, 7% we'll see.

All right, sir. Sir, in terms of our...

Let's give someone else a chance. There are -- I think just like you have taken the trouble to come back, there are some others also. Let us, sir, come back. If not, I will...

I'll send my questions over mail then.

Done, sir. We will resolve that.

The next question comes from the line of [ Ronit Kapoor ] from [ Investaya Investments ].

Yes. So just wanted to know, I think Pune and Noida had some additional rooms. So do you quantify that? And when do you expect it to come?

A very good question, sir. So Pune hotel renovation, which is going on, we expect Pune hotel to do exceedingly well in the coming year, based on the renovation getting completed this year. But that said, side by side, the revenue growth will happen from this year itself, though its full potential will mature next financial year. This year, we basically will be operating with all 410 rooms. So that is one thing, from currently 385 [Foreign Language] -- 386. So we'll come to 410-odd rooms. Though that sounds less, but we have to appreciate that this is with additional banquet venues that have been made and, along with that, the upgraded all rooms, suites and other things which are there. And in the case of Noida, there is another additional wing, which has to come with 25 rooms. Once that comes, then the sales of our Noida and the EBITDA also will considerably improve because, right now, with 34 rooms, it can get a struggle at times. But once we have the scale, that time it will help us even further. So this -- we are -- we were expecting it to already come. If it doesn't come by April, there is a penalty on the owner. So that will help our EBITDA further because we'll have to pay lesser rent on -- extremely low rent once the April time frame. We think that he's going to definitely default because his work speed is very slow. So that is the -- not a plus point I want because we don't want our owners to be unhappy. At the same time, we cannot afford our shareholders and us to be unhappy. So everyone has to finish as per their committed time. If he finishes by his committed time, then we will be having the entire thing to do of 60 or whatever the rooms number -- total.

And lastly, I wanted to know, a lot of consolidation is taking place in the mid-scale segment, like with the Clarks acquisition and the Marriott partnership with Fern. So are we looking at some brand partnership? Or how do you feel this will affect the industry, particularly, like these 2 consolidations?

So as of now, sir, we have nothing in our horizon. If there is an opportunity where we can consolidate somebody, we'll be happy to look at it. But as of now, we have not seen anything worthwhile in our horizon for us to become a part of us. This is an opportunity, and I think this opportunity will continue to be there, whereby there will be a consolidation further in our industry. And that's a good thing. So let's see, sir. Let's see. We are looking for some good opportunity ourselves. So that will help us to grow inorganically.

Okay. And this Odisha, you had signed some 2, 3 hotels. So any update on that?

Our existing hotels, which are there, sir, I don't know which one you are mentioning.

I think you had signed some hotel in -- the Odisha government came up with a proposal of INR 50 crores. I think 50-room hotel is coming with Kamat, right, in some...

So that -- government has to basically give us land, which if they give us the land, then we will be able to make the hotel over there. There are a couple of places with some excellent potential. And once that progresses, we can share more details with you, sir. So as of now, nothing has -- nothing particularly for us to share on that point.

Okay. And Puri would be coming up by when because I see it's been delayed as such?

Correct. So there was an -- there is an -- in Puri Jagannath, there is an issue that there was an aviation and other clearance issue because of which everybody's project was on hold because they were not giving the height, because now there's a new airport coming at Puri. And because of which now our height clearance has come and our architects are working on it. So that will take approximately 2.5, 3 years.

And this will be done on your own or like in a joint venture, sir?

We'll see, sir. We will see. Right now, the opportunity lies for us to basically look at extracting some potential. If we do, do it with a partnership, we're open to it because there's no point in us looking at it only solo. At the same time, we can look at it solo because it's a 3-year horizon. So we'd like to basically look at the best value we can get for the asset in a win-win.

We take the next question from the line of [ Viraj Shah ] from [ Tatvic Digital Analytics ].

Sir, my question is regards to the number of rooms that we have mentioned in the presentation, 2,500 rooms that we are expecting in FY '26, and net debt levels to go to INR 50 crores. So sir, I just wanted to understand the time lines on this.

So sir, one good news is that our net debt levels are almost at INR 50 crores already, okay? So that is already almost achieved because the kind of cash in hand reserves we have vis-a-vis the loan that we have, we are already in around INR 65 crores, INR 68 crores as of now. So that's not really an issue anymore. So that's one thing. Secondly, you mentioned about the -- sir, the second thing you mentioned about?

Number of keys, sir, the 2,500, which was the target for FY '26. So I wanted to understand the time lines on this.

So sir, it will just defer to the coming 6 months because, as you have heard, many of them are opening in the month of April, May, June accordingly. So it will just defer to the coming 6 months based on what target of growth we are looking at. There are some other things also in pipeline, which are happening. But till they don't get confirmed, there's no point in us discussing it. So that's it.

Ladies and gentlemen, that was the last question for today. I would now like to hand the conference over to the management for the closing comments.

Thank you very much, everyone, for listening in. I really appreciate the questions which were asked. And I hope that those who have been answered satisfactorily, if you have any further questions, then you can please reach out to our IR partners, Valorem, or you can directly reach out to us also to our Company Secretary or Smitaji or me. We are all available to answer any queries that you may have. Thank you very much. I appreciate all. Thank you. [Foreign Language]

Thank you, sir. Ladies and gentlemen, on behalf of Kamat Hotels (India) Limited, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines.