Investors in IHCL seem to be betting on its asset-light strategy.
Step taken by IHCL for Hotel Industry brought lot of changes in Market a major shift from Traditional Strategy to Asset Light Strategy focus on Equity Investment on those where an organization's expertise achieves the best return for investors.
Benefit of this Strategy are:
Positive impact on investors
IHCL and EIH Ltd have outperformed the Nifty Midcap Index on a one-year horizon
Higher Returns on Investment (ROI)
Ebitda (Earnings Before Interest, Tax, Depreciation and Amortization) rose by 16% after the implementation of Indian Accounting Standards -116 norms
Higher operating performance implied costs are being in control.
“Traction in new signings continued with addition of 1,257 rooms in Q1FY20 (April-June) across seven cities, which took the pipeline to 4,500-plus rooms (FY19: 4,000 rooms)." According to Edelweiss Securities Ltd.
Seven new contracts in Q1 added
Occupancy rates in the industry moved up by 3% points to 69% year-on-year in FY2019, according to data from ICRA Ltd.
UK & US business remain in cloud .
Earnings Per Share (ERP) Increase by 35% average compounded rate due to Margin Expansion and Lower Capex Intensity.
source : ET
