INDIAN HOTELS (IHCL) × ORIENTAL HOTELS — MERGER PLAY

Oriental Hotels – FY26 • Revenue growth: ~13.5% 3-year CAGR • Operating Margin: 26.57% • ROE: 9.41% • ROCE: 11.60% • Debt/Equity: 0.17x • Net Debt/EBITDA: 0.92x 📈 Q1 FY27: Revenue: ~₹112.8 Cr EBITDA: ~₹24.7 Cr PAT: ~₹9.5 Cr The quarter was weaker sequentially, highlighting the seasonality of the hotel business. 🚀 Why It Matters ✅ Direct ownership of premium properties ✅ Potential operating & cost synergies ✅ Simplifies the holding-company structure ✅ Stronger asset portfolio for IHCL ✅ Management targeting >30% consolidated EBITDA margin post-merger ⚠️ Key Risks 🔴 Merger execution risk — approvals and integration could take time. 🔴 Valuation risk — hospitality stocks can trade at high multiples; Oriental Hotels' FY26 EV/EBITDA was around 12.5x. 🔴 Cyclicality — hotel demand is sensitive to economic conditions, travel and corporate spending. 🔴 Seasonality — quarterly earnings can fluctuate significantly.