Praveg Limited (PRAVEG.BO) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Q2 and H1 FY '26 Results Conference Call of Praveg Limited, hosted by Kirin Advisors Private Limited. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Parth Acharya from Kirin Advisors Private Limited. Thank you, and over to you, sir.

Thank you. On behalf of Kirin Advisors, I welcome you all to the conference call of Praveg Limited. From the management team, we have Mr. Vishnu Patel, Chairman; and Ms. Bijal Parikh, Finance Director. With that, now I hand over the call to Ms. Bijal Parikh.

Good afternoon, everyone, and thank you for joining us today. It is a pleasure to connect with all our investors, analysts and stakeholders. At Praveg Limited, our focus has always been to create a meaningful, nature-led, eco-responsible luxury experiences for our guests. Our resorts are located in culturally and ecologically important destinations, and we continue to build our presence in a thoughtful and responsible manner. Alongside our hospitality business, our event and destination management capabilities remain a strong pillar of our overall strategy. The first half of financial year '26 has been a period of continued expansion and operational progress for Praveg. We now operate more than 825 rooms across 17 resorts and 1 hotel. This growth in scale reflects the work done over the past few quarters to strengthen our portfolio, enter new locations and bring new experiences to the market. During the quarter, our Hospitality & Event segment contributed INR 26.29 crores, and the Advertising segment contributed INR 11.21 crores. We also had a significant operational milestone in H1 financial year '26. We received the letter of award for World Lion Day 2025, which reinforced our long-standing presence in premium government event management. We also officially commenced operations at Praveg Adalaj Theme Park on 25th September 2025. This property marks an important addition to our experiential and event-driven assets and positions us strongly in the premium events and entertainment category. The strength of our operational footprint and the expansion of our room inventory continue to create a solid foundation for future growth. Let me now take you through our financial performance for H1 financial year '26. On a consolidated basis, total income grew by 28.94% to INR 77.71 crores. This growth has been supported by continued expansion of our Hospitality portfolio and steady performance in the Events and Advertisement segment. Consolidated EBITDA for H1 financial year '26 stood at INR 10.17 crores. The company reported a consolidated net loss of INR 14.97 crores. Margins were impacted during the first half due to higher operating costs at newly launched properties, along with the temporary closure of our four seasonal resorts during Q2, and owing to adverse weather conditions. This resort and new properties require initial ramp-up investment before they stabilize, and this is a normal size in hospitality operations. Profitability was also affected by fixed lease commitments payable to the government under PPP model. On a stand-alone basis, total income stood at INR 56.55 crores. EBITDA for H1 financial '26 was INR 3.72 crores, and the stand-alone net loss was INR 16.71 crores after accounting for Ind AS 116 adjustment. Depreciation for the half year was INR 15.98 crores, which reflects the larger operating base created through recent expansion. While the first half show cost pressure, we remain optimistic about the outlook for the rest of the year. The second half is traditionally stronger for the Indian tourism and hospitality sector. Travel typically picks up from October onwards due to the festive season, the winter holiday period, higher leisure travel, destination weddings and corporate events. This trend is seen consistently across the industry and supported by broader travel and hotel occupancy data. With our seasonal properties reopening and our newer properties gaining traction, we expect healthier operating leverage and an improvement in profitability during the second half. Our long-term strategy focuses on disciplined expansion, strengthening our eco-luxury positioning and enhancing operational efficiency. With a growing presence across high potential destinations and an expanding portfolio of unique experiences, we believe Praveg is well placed to capture the rising demand for experiential and sustainable travel in India. Before closing, I would like to thank all our investors, partners, employees and guests for their continued support. Your trust motivates us to keep improving, keep innovating and keep building Praveg into a leading name in eco-responsible luxury hospitality. Thank you once again for joining us today. We are now happy to take your questions.

[Operator Instructions] The first question comes from the line of Mohit Jain from DRChoksey Finserv Private Limited.

My first question, ma'am you have written on the press release that there are a few fixed PPP leased commitments with the government, which continue even in low occupancy.

I'm sorry to interrupt, Mohit. Could you be a little louder, please?

Can you hear me now?

Yes.

Yes. I was saying the fixed PPP lease commitments with the government continues even in the low occupancy months. So are you renegotiating any of these terms, especially for properties where seasonal volatility is higher?

[Foreign Language]

[Foreign Language]

[Foreign Language] In short, we can't negotiate it. But when the tender again come, automatically that value will be again you said in terms of the market feasibility and market competition.

[Foreign Language] Can you give us some figure on when do you expect breakeven targeted first year revenue from et cetera, et cetera?

[Foreign Language] That's why we have compromised the business of Exhibition and Events. And that you find -- since last two announcement is done, we have again recaptured that business and started on that line. The business earlier, before 2020 or '21, which was INR 50 crores, INR 70 crores, INR 80 crores above, which is almost came to INR 10 crores. So now again, we are regaining that portfolio and we have built up team accordingly, and we have redesigned and reset our team from development team as well as exhibition and events team. So we are recapturing that portfolio also. Now I'll come to our Adalaj point. Adalaj, Lakshadweep, two property which we are going to inaugurate 100 room in Thinnakara North and 100 rooms in Thinnakara South. Out of that, 100 and 200 room is a special property of India basically. It's not only hotels or resorts. It's beyond that. Here they have all [Foreign Language] activity. Water sport, water activity, cruise -- yacht as well as experience boatings. [Foreign Language] Because we have 50 room already started in Bangaram, that's operated by Taj SeleQtions. 100 room, in nearby we are launching. So 100 room, then after again 100 room we are launching depend upon our occupancy response. So as to fixed cost we can avoid. [Foreign Language] So apart from room revenue, we are going to get various conference, exhibition as well as Government of India, different, different state government is interested for conference as well as business program of entire India's corporate team. So many things is going to happen in that place. So it's beyond room and beyond ARR income. So in the Adalaj, Adalaj we have only 10 rooms, that's to host our theme-based destination. [Foreign Language] Just we have launched on the first day of Navaratri. We got tremendous response. Some social media, the reach was highly published in Gandhinagar and Ahmedabad area. And more than 1 million likes and views we gotten for that. [Foreign Language] So we'll see the Adalaj will be outperformer for Ahmedabad and Gandhinagar theme-based destination, especially for culture, music, festivals, as well as wedding program.

My last question, sir, since [Foreign Language] Do you think they will have a good growth in second half?

You tell -- you can even see the historical data of our Praveg balance sheet. You always find Q1 and Q2 weak, Q3 and Q4 always beyond that. So because of this is a seasonal variation. And Q3, Q4 will be same like earlier trend. [Foreign Language] Bangaram is launched, which is not working this year from 15th May to around October, it was not working. So entire cost is on this balance sheet. Number two, exhibition event management team, we have rebuilt to -- after 2 years, all my debt portfolio I want to recover, which we have lost due to this experiences hospitality development. [Foreign Language] And we are expecting good business from Event, Exhibition in this H2 also. So last year, it was almost nil. You will find in good volume. So you will satisfied after that result, if I can say like that.

[Operator Instructions] The next question comes from the line of Pratik Patel from NiftyMillionaire.

[Foreign Language] So I want to know about Thinnakara and Bangaram.

See, Bangaram resort is already operated -- started operation in this October month. And in initial October, November month, it is normal, but we are expecting December, January, February, March are outstanding. And we have good amount of inquiry, which is came, as well as we have started city-wise targeting various city for the Bangaram and Thinnakara business. [Foreign Language] As you know, this is a greenfield or gray area, which we have started. Now publicity is started. And in Bangaram, extraordinary response we are expecting. And Thinnakara, we are starting in very near time line and make its announcement in very near future.

Sir, any idea like within 3 months or 6 months [Foreign Language]?

One month. You can allow us 15 days plus/minus, okay?

So we can get the benefit of these next few months season like, because [Foreign Language]?

[Foreign Language]

[Foreign Language]

October, Taj SeleQtions is operating there. I have to tell -- Bijal ma'am, can you share anything about October data, October, November?

So October, the occupancy level was approximately 25% to 30%. The weather was impacting...

Yes, weather was -- yes, very raining ma'am since cyclone was there in October.

[Foreign Language] Some people are demanding maybe non-veg. So do we have the availability of non-veg because as a Praveg, we don't serve here, that we serve only vegetarian, yes.

I would like to tell and focus about it. Praveg is a pure veg restaurant, pure vegetarian company. So we are not providing. But Taj SeleQtions, other than our 50 rooms, adjoining government property is there, there full non-veg facility is there, which is already managed by the Taj Group. And it's in books of the Taj. They are sharing their profit and whatever it may be with the government. We have nothing to do with that. But in our 50 room and our services, we are not providing non-veg on our books.

And do you think sir, I think next one year as we have invested a lot of money in Lakshadweep. [Foreign Language]

[Foreign Language]

And sir, any guidance for this year if you can share?

[Foreign Language] Beside that, we want to be progressing in Exhibition, Event line. But the entire surplus will be in addition to the last year trend, as well as Advertisement. Both will be the trending, which was almost very visible in last '25 -- last two quarters of '25. This last two quarters, you can find Advertisement and Exhibition business on good scale. Besides, Hospitality business incremental due to -- with our CM. [Foreign Language]

[Foreign Language]

[Foreign Language]

Okay. And sir, any comment on the White Rann?

White Rann is good, and we are almost in a mode of expansion there also, and you will find some exciting news.

[Foreign Language]

Marketing, Bijal ma'am, you answer it.

So basically, for Praveg White Rann Resort, what we felt is that we don't require marketing. Rather than doing the holdings and all, we do the -- our marketing expenses on the social media side, which gives us the better results. So we are more focused on the digital marketing side.

[Foreign Language] Wish you best of luck.

The next question comes from the line of Kailash from Sequel Securities.

[Foreign Language]

[Foreign Language] Service of the customer, rating of the customer. Like a 5-star property, we have to give the best service. Wherever there is any [indiscernible], we can't run on that mode. [Foreign Language] Food and beverage is what outsourced. Housekeeping was outsourced. Now, the team from 100 is become 1,500 employee team within 1.5 years. [Foreign Language] Balance sheet is the utmost important, I'm not deny that. But in longer run, I will convert that experience to balance sheet.

[Foreign Language]

[Foreign Language] Praveg is following 100% corporate governance and compliances. Even some -- before Diwali, income tax search also came to the Praveg. And we have declared, we have filed in the exchange that they found nothing any obsessionable. Nothing is happening. Why? Because of our corporate and accounting governance, number one. [Foreign Language] December 23 was the date when -- I think November or December '23, where our honorable Prime Minister visited Lakshadweep. That time, Bangaram was awarded to Praveg, that you know well. Agatti was awarded to Praveg. That time, if you see that time of Twitter, then after next month, and it is January '24, Ram Mandir temple was inaugurated, two property was awarded to the private that time, and entire boom in social media lead to this market panic mode and all the investors are on emotional ground. Maybe I can't comment on it, but they do the buying, and the investor bid of the company was manyfold increase. And that was the reason for the INR 1,300. That is not exactly my opinion about any pricing. I'm not making any opinion for pricing. We are following corporate governance. So this is not my subject. But whatever as a layman I studied, everybody was behind Twitter and social media. [Foreign Language] So as a investor, I would say only one thing. You think about longer vision, rather than shorter vision. The shorter vision, may not satisfied that time, and they may have sold their portfolio. [Foreign Language] So always any flight, even aircraft, when it take off, it consume more fuel. You understand this. And this company is not old company in hospitality. You have to give some time to take off.

[Foreign Language]

[Foreign Language] With the warrant money, we were 25% profited. That you know, right? This comes to be a part of reserve without any debt, without any liability, number one. Number two, to that extent, we can fill up by the debt of the group company or from promoters or from banks if required for the growth. And we have restricted our focus from in-house CapEx to investor CapEx model. We find we are trying -- we have some -- going various negotiation and we get a good result. Whereby without company's investment, we will grow our hotels -- number of room as well as number of hotels in year to come.

[Foreign Language]

I'm sorry to interrupt, Kailash. Could you please rejoin the queue, so that the other participants could ask their questions? The next question comes from the line of Hrushikesh Shah from Alchemy.

Sir, am I audible now?