ITC Hotels Delivers Strong Growth Post-Demerger, Eyes 220 Hotels

Industrial Goods/Services

1st November 2025, 4:53 AM

ITC Hotels Delivers Strong Growth Post-Demerger, Eyes 220 Hotels

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Stocks Mentioned :

ITC Limited

Short Description :

ITC's hotel business has reported robust performance since its demerger in January, with net profit increasing by 40.8% in the first quarter and 76% in the second quarter of FY26. Chairman Sanjiv Puri announced an accelerated expansion plan to reach 220 hotels by year-end, surpassing initial projections. The company is also launching a new premium brand, 'Epiq Collection', and leveraging an 'asset-right' strategy to capitalize on India's growing domestic tourism and luxury market.

Detailed Coverage :

ITC Limited's strategic demerger of its hotel business in January has yielded significant positive results. The hospitality arm recorded a substantial 40.8% growth in net profit during the first quarter post-demerger, followed by an impressive 76% surge in the second quarter of FY26. Chairman and Managing Director Sanjiv Puri expressed great optimism, revealing that the company is now targeting 220 hotels by the end of the current year, an upward revision from the previously projected 200 hotels by 2030.

ITC Hotels, which currently manages over 140 properties across six brands, is introducing a new premium offering named ‘Epiq Collection’. The first two projects under this collection are under development in Puri and Tirupati, with a medium-term goal of establishing 1,000 keys, focusing on culturally rich destinations.

Mr. Puri attributed this growth to the successful implementation of an 'asset-right' strategy, which prioritizes management contracts and franchising to optimize capital use and accelerate expansion. He highlighted India's lower per capita density of hotel rooms compared to the global average, coupled with increasing domestic travel appetite and improved infrastructure, as key drivers for the sector's potential.

Furthermore, the booming Indian luxury market and a post-COVID shift towards domestic travel are creating fertile ground for expansion. ITC plans to operate across the full spectrum of the hospitality market, with a significant presence in upper upscale and budget segments for volume, alongside a strong footprint in luxury.

Impact: This news signals robust operational and financial health for ITC's hotel segment, a significant contributor to the conglomerate. The aggressive expansion and positive growth rates can enhance investor confidence in ITC Limited, potentially leading to favorable stock performance. The continued growth in hospitality also reflects strong consumer spending trends in India's travel and tourism sector. Rating: 7/10.