### Supreme Court Intervenes in Hyatt Regency Valuation Dispute
The Supreme Court has agreed to hear a petition alleging a substantial undervaluation of the Hyatt Regency Hotel in Delhi during one-time settlement (OTS) deals involving Asian Hotels (North) Pvt Ltd and two public sector banks. The NGO Infrastructure Watchdog is challenging a Delhi High Court order that previously dismissed its plea for a probe by the CBI and CVC. The apex court's decision to issue notices to the Centre, Asian Hotels (North), Bank of Maharashtra, and Punjab National Bank signals a potential re-examination of how commercial settlements involving public assets are conducted.
### Public Funds, Commercial Wisdom, and Judicial Oversight
Representing the NGO, advocate Prashant Bhushan characterized the situation as a form of "bank fraud." The banks' defense, through an Additional Solicitor General, asserted the transactions were genuine commercial dealings with a 116% recovery of loan amounts, arguing against an "unfounded roving inquiry." However, the bench, led by Chief Justice Surya Kant, emphasized that public sector banks manage "public funds" and that their "commercial wisdom" must be assessed against protecting public interest. The court's directive to produce all relevant records, including bank reports and complete loan details, indicates a resolve to ensure transparency and fairness, particularly when public money is at stake. This stance echoes recent judicial remarks stating that "if public funds are siphoned off, willingness to pay may not help" in bank fraud cases.
### Banking Sector Strength Meets Targeted Scrutiny
This legal challenge emerges against a backdrop of significant improvement in the Indian banking sector's asset quality. Gross Non-Performing Assets (GNPAs) have reportedly fallen to a multi-decade low of 2.1% by late 2025, with Net NPAs at 0.5%. Recovery rates have nearly doubled since FY18 to 26.2% in FY25. Bank of Maharashtra, with a market capitalization around ₹50,320 Cr and a P/E of approximately 7.77, reported a Net NPA ratio of 0.15% as of September 2025. Punjab National Bank, a larger entity with a market cap near ₹1.42 Lakh Cr and a P/E of around 7.99, also operates within this strengthening financial environment. Despite the sector's overall positive trajectory, this specific case highlights potential vulnerabilities in OTS processes, especially concerning large asset valuations.
### Hospitality Sector's Robust Growth Amidst Legal Clouds
Meanwhile, the Indian hospitality sector continues its strong growth trajectory. Projections indicate the market could reach USD 55.67 billion by 2031, with a CAGR of approximately 14.76%. In 2024, the sector saw sustained investment levels, with a notable shift towards Tier II and III cities and a significant increase in branded hotel signings. Occupancy rates are projected to reach 70% in FY25, with Average Daily Rates (ADRs) and Revenue Per Available Room (RevPAR) showing upward trends. Amidst this positive outlook, Asian Hotels (North) Limited, the operator of Hyatt Regency Delhi, recently saw Elana Holdings PTE. LTD. acquire a significant stake through a preferential issue on February 4, 2026, raising over ₹90 crore. This strategic investment suggests underlying confidence in the company's operational value, separate from the current loan settlement dispute. However, the ongoing Supreme Court case could introduce headwinds for the company and potentially influence future hotel property valuations in OTS scenarios.