Apeejay Surrendra Park Hotels: Navigating a Super Cycle with Strategic Expansion and Digital Prowess

Apeejay Surrendra Park Hotels Limited (ASPHL) has delivered a robust performance in the second quarter and first half of Fiscal Year 2026, showcasing strong operational momentum amidst a dynamic Indian hospitality landscape. The company, a prominent player in the upscale and upper mid-scale segments, reported its best-ever Q2, with consolidated operating revenue reaching ₹165 crore, marking a 16.8% year-on-year growth. This impressive top-line expansion was complemented by a mid-teen EBITDA growth, reaffirming the efficacy of its strategic initiatives and brand strength. For the first half of FY26, consolidated net revenue grew by 15.5% to ₹320 crore, with operating EBITDA at ₹94 crore.

ASPHL's performance was underpinned by India's leading occupancy rate of 93%, a testament to its strong brand appeal and guest trust. The Average Room Rate (ARR) saw a healthy 13% increase, while Revenue Per Available Room (RevPAR) grew by 12%. This market leadership in key operational metrics highlights the company's ability to capitalize on the burgeoning demand within the Indian hospitality sector. The company's diversified portfolio, spanning hotels, food and beverage (F&B), and entertainment, continues to drive sustained growth across segments.

Strategic Growth and Portfolio Expansion

ASPHL's growth trajectory is marked by a disciplined execution of its expansion plans, focusing on both organic and inorganic opportunities. A significant milestone in Q2 FY26 was the completion of the acquisition of a 90% stake in Zillion Hotels & Resorts Private Limited for approximately ₹206 crore. This strategic move marks ASPHL's entry into Mumbai, a crucial and vibrant hospitality market. The acquired property in Juhu is slated for development into an 80-room super luxury boutique hotel, expected to open by the end of 2026, promising to set new benchmarks for the brand.

Further strengthening its presence in South India, ASPHL is in the process of acquiring 31 rooms across Malabar House Fort Kochi and Purity at Lake Vembanad for ₹64 crore, with an agreement finalized in November 2025 and launch anticipated by December 2025. These acquisitions align with the company's strategy to enhance its premium positioning in the luxury segment and support long-term earnings growth.

On the development front, the new mixed-use project at EM Bypass, Kolkata, has received approval from the Kolkata Municipal Corporation (KMC). This project, comprising 100 apartments and 250 hotel rooms, is scheduled for groundbreaking in January 2026, with an estimated completion within three years. While some greenfield projects, including those in Pune and Vizag, have experienced minor delays due to permissions and local factors, management is actively compensating for these with strategic acquisitions and a robust pipeline.

Financial Summary (Q2 FY26)

Digital Leadership and Sustainability Commitment

ASPHL is not just expanding its physical footprint but also investing heavily in digital transformation and sustainability. The company is implementing NOR1, an AI-based upselling platform, to enhance its revenue management system. This Oracle-based software, equipped with generative AI capabilities, aims to optimize dynamic pricing, improve demand forecasting, and facilitate upselling across rooms, F&B, and other facilities, thereby maintaining industry-leading ARRs and occupancies. This initiative underscores ASPHL's commitment to innovation and operational efficiency.

Under its 'Park Planet Positive' program, ASPHL is advancing its sustainability agenda with key initiatives in renewable energy, water conservation, and waste management. The company has set ambitious targets, including achieving 100% electric vehicle transport by FY26, 95% landfill diversion, waste neutrality by 2025, water neutrality by 2028, and carbon neutrality by 2032. These efforts reflect a long-term vision of building a modern, inclusive, and environmentally conscious hospitality enterprise.

Segment Performance (Q2 FY26 Operating Revenue)

Outlook and Management Confidence

Management expresses strong confidence in the company's future, anticipating a