Indian Hotels' consolidated net loss narrows to Rs 130 cr in Sept quarter

Tata group hospitality firm Indian Hotels Co Ltd (IHCL) on Thursday reported narrowing of its consolidated net loss at Rs 130.92 crore in the second quarter ended September 30, on the back of recovery of demand, especially in leisure destinations.

The company, which had posted a consolidated net loss of Rs 252.09 crore in the year-ago period, said its board at a meeting held on Thursday has approved increasing plans to raise funds to Rs 4,000 crore from Rs 3,000 crore approved earlier in August this year.

The enhanced fundraising plan includes a rights issue to the existing shareholders of the company for an amount of up to Rs 2,000 crore, followed by the qualified institutional placement (QIP) of equity shares for up to Rs 2,000 crore.

In a regulatory filing, IHCL said its consolidated revenue from operations in the second quarter stood at Rs 728.37 crore as against Rs 256.67 crore in the corresponding period last fiscal.

Total expenses during the second quarter stood at Rs 871.14 crore as compared with Rs 606.62 crore in the same period last fiscal.

In the first half of the fiscal, IHCL said its consolidated net loss narrowed to Rs 432.50 crore from Rs 564.69 crore in the corresponding period last year.

Revenue from operations in H1 was at Rs 1,072.92 crore as compared with Rs 400.28 crore in the same period last fiscal.

The business has been impacted during the half-year period on account of COVID-19. During the first three months of the year, the group witnessed softer revenues due to the second wave of COVID-19 and consequent lockdowns in several states in India, where the group predominantly operates, the filing said.

"However, in the beginning of the current quarter, the lockdowns were lifted due to lower active COVID-19 cases and increased vaccinations, and the group witnessed positive recovery of demand, especially in leisure destinations and business is gradually expected to improve," it added.

On the matter of fundraising, IHCL said the company's board at its meeting held on Thursday approved a partial modification to its earlier decision taken on August 23, 2021, to raise funds not exceeding Rs 3,000 crore by way of a rights issue.

Accordingly, the board has approved the issue of equity shares by way of a rights issue to the existing shareholders of the company for an amount not exceeding Rs 2,000 crore and raising of funds through equity issuance for an amount not exceeding Rs 2,000 crore through qualified institutional placement (QIP) after the conclusion of the aforesaid rights issue.

IHCL further said its board has also approved acquiring 39.84 per cent stake in Roots Corporation Ltd from its existing shareholders Omega TC Holdings Pte Ltd, Tata Capital Ltd, Tata Investment Corporation Ltd and Piem Hotels Ltd, for a consideration not exceeding Rs 500 crore. Subsequently, RCL will become a wholly-owned subsidiary of the company.