At a Glance
Robust Hotels Ltd, the proud owner of Hyatt Regency Chennai (yes, just one property), has delivered Q1 FY26 numbers that whisper, “We’re alive and profitable… barely.” Revenue stood at ₹33.24 crore, Net Profit at ₹4.03 crore, and OPM at a surprisingly strong 30%. For a company that once thought profits were a myth, this quarter is practically a miracle. The stock is trading at ₹285, about 0.68x its book value – cheaper than the hotel buffet on a weekday.
Introduction
If hotels were cricket teams, Robust Hotels would be the underdog franchise still waiting for a trophy. Managing a single Hyatt Regency property in Chennai, it’s been through losses, debt juggling, and even a court battle with Ramani Hotels (which they won, by the way). But Q1 FY26 shows signs of revival – revenue is holding steady, margins are healthy, and profit is creeping back like a late-night room service order.
Still, before you pop the champagne, remember the company has a low ROE (2.3%) and a debt shadow that lingers. Investors love a turnaround story, but is this one for real?
Business Model (WTF Do They Even Do?)
Robust Hotels is basically Hyatt Regency Chennai with extra steps. The company owns and operates this 5-star property with 325 rooms, 28 suites, banquet halls, restaurants, a salon, and a pool where the only thing that’s deep is the water. Revenue comes from room bookings, events, F&B, and miscellaneous hotel services.
Unlike Indian Hotels or EIH that have portfolios across cities, Robust has placed all its bets on Chennai. No diversification, no frills – just one big hotel trying to stay relevant.
Financials Overview
Q1 FY26 Snapshot:
- Revenue: ₹33.2 crore (down 15% QoQ)
- EBITDA: ₹10 crore (OPM ~30%)
- Net Profit: ₹4 crore (down 60% QoQ from ₹10.3 crore)
- EPS: ₹2.33
Over the last three years, revenue grew 49% CAGR (thanks to post-COVID revenge travel), but profit is still volatile. Other income (₹4.5 crore this quarter) is saving the day – without it, profits would look sad.
Valuation
The stock trades at a P/E of 29.9 and just 0.68x book value. Compared to peers trading at nosebleed valuations (Chalet 139x, Lemon Tree 60x), this looks like a bargain.
- P/E Method:
EPS FY25 = ₹11.06, apply sector avg P/E 40 → ₹442 - EV/EBITDA Method:
EBITDA FY25 = ₹36 crore, apply EV/EBITDA 15 → EV ₹540 crore → Per share ≈ ₹320 - DCF (quick):
Growth 15%, WACC 10% → Fair Value ≈ ₹350
Fair Value Range: ₹300–₹350
What’s Cooking – News, Triggers, Drama
- Court victory: Ramani Hotels ordered to pay ₹34.2 lakh (pocket change, but still a win)
- Loan restructuring: Interest now annual instead of quarterly – less cash stress
- High season ahead: Q2 & Q3 usually bring more events and occupancy spikes
- Expansion? None announced – they’re still busy fixing Chennai.
Balance Sheet
| Assets | ₹ Cr |
|---|---|
| Total Assets | 906 |
| Net Worth | 717 |
| Borrowings | 154 |
| Liabilities | 34 |
Auditor Roast: Debt is like the annoying relative that won’t leave – manageable but still there. Assets are hotel-heavy, so don’t expect quick liquidity.
Cash Flow – Sab Number Game Hai
| Year | Ops | Investing | Financing |
|---|---|---|---|
| FY23 | ₹27 Cr | ₹20 Cr | -₹27 Cr |
| FY24 | ₹29 Cr | -₹79 Cr | ₹33 Cr |
| FY25 | ₹54 Cr | -₹27 Cr | -₹21 Cr |
Comment: At least operating cash flow is healthy; investing cash flow looks like a renovation binge.
Ratios – Sexy or Stressy?
| Ratio | Value |
|---|---|
| ROE | 2.3% |
| ROCE | 4.4% |
| P/E | 29.9 |
| PAT Margin | 12% |
| D/E | 0.21 |
Takeaway: ROE and ROCE are as low as hotel WiFi speeds. Needs a boost.
P&L Breakdown – Show Me the Money
| Year | Revenue | EBITDA | PAT |
|---|---|---|---|
| FY23 | ₹106 Cr | ₹29 Cr | ₹-3 Cr |
| FY24 | ₹122 Cr | ₹33 Cr | ₹5 Cr |
| FY25 | ₹136 Cr | ₹36 Cr | ₹16 Cr |
Comment: From losses to modest profits – slow, but steady.
Peer Comparison
| Company | Revenue (₹Cr) | PAT (₹Cr) | P/E |
|---|---|---|---|
| Indian Hotels | 8,825 | 1,716 | 62 |
| EIH | 2,743 | 768 | 31 |
| Lemon Tree | 1,286 | 197 | 61 |
| Robust Hotels | 140 | 19 | 30 |
Comment: Revenue is peanuts compared to peers, but valuation is still decent.
Miscellaneous – Shareholding, Promoters
- Promoter Holding: 65.6% (stable)
- FII/DII: negligible
- Public: 34%
Promoters are the Saraf Group – experienced hoteliers but expansion-shy. No IPO drama or pledges.
EduInvesting Verdict™
Robust Hotels is like that friend who’s trying hard to get fit – progress is there, but the abs are still hiding. The company’s single-property model is risky, but Q1 FY26 shows operational improvement and decent margins. Debt is manageable, cash flows are positive, and valuations are not insane.
SWOT
- Strengths: Strong Hyatt brand, improving profits, cheap valuation.
- Weaknesses: Low ROE/ROCE, single asset dependence.
- Opportunities: Event-driven revenue boost, room rate hikes.
- Threats: Any drop in Chennai occupancy could crush numbers.
Final Word: A cautious turnaround play. Not as flashy as Indian Hotels, but at least it’s not bleeding anymore.
Written by EduInvesting Team | 29 July 2025SEO Tags: Robust Hotels, Hyatt Regency Chennai, Q1 FY26 Results
