Sterling records seven Q2 openings, surpasses 4,000 keys

Sterling Holidays opened a record seven resorts in Q2 FY27, taking its network to 83 properties and above 4,000 keys as of September 30, 2026. The expansion used six management contracts and one revenue-share property, while Sterling reported approximately Rs 127.2 crore of quarterly revenue, up about 17% year on year.

How did Sterling expand its resort network in Q2 FY27?

Sterling added seven resorts in Q2 FY27, its highest number of property openings in a single quarter, raising the portfolio to 83 properties and crossing 4,000 keys by September 30, 2026. The additions comprised six management contracts and one revenue-share property, rather than owned or leased resorts, which management said was consistent with its asset-light and capital-light expansion approach.

The Q2 additions broadened Sterling beyond its established leisure network into business destinations and locations combining business and leisure demand, while retaining leisure categories including spiritual, wildlife and destination-led hospitality. Management said three wildlife properties opened in September 2026, ahead of higher safari demand from November, a timing that could shorten their ramp-up period.

Sterling’s network expansion was accompanied by a stated strategy to develop into a multi-segment, full-format hospitality company. Management cited the company’s distribution capability, revenue management, existing guest network, channel partners and operations as supporting that approach, while the seven Q2 openings added capacity before the October-to-March demand period.

What did Sterling’s Q2 FY27 operating metrics show?

Sterling’s operating indicators improved in Q2 FY27: room nights sold rose approximately 23%, occupancy increased about 300 basis points, and average room rates in its owned-and-lease portfolio rose about 12%. A basis point is one-hundredth of a percentage point, so the occupancy movement equates to 3 percentage points. Total revenue per available room, or RevPAR, increased 12%.

The 12% RevPAR increase matched the rise in average room rates in the owned-and-lease portfolio, while room-night growth of 23% and the 300-basis-point occupancy improvement added volume to the wider network. Management said this combination reflected both new-resort openings and improved guest attraction, pricing and monetisation of existing properties during the July-to-September period, which it described as seasonally weak.

For H1 FY27, the improvement was larger on occupancy and room volume than in Q2 alone. Room nights sold rose approximately 24%, occupancy increased 500 basis points, average room rates rose approximately 11%, and RevPAR grew a little over 15% year on year. The first-half figures cover two quarters, whereas Q2 was affected by monsoon conditions and softer leisure and wildlife demand in several destinations.

How did Sterling’s revenue and profitability change in Q2 FY27?

Sterling reported its highest Q2 revenue at approximately Rs 127.2 crore, up about 17% year on year, while earnings before interest, tax, depreciation and amortisation, or EBITDA, rose to approximately Rs 28.9 crore from Rs 27.7 crore. Profit before tax, or PBT, was approximately Rs 14 crore in Q2 FY27. Management attributed the revenue progress to a larger network alongside higher room nights, occupancy and rates.

The difference between Q2 revenue growth and reported EBITDA growth partly reflected approximately Rs 4 crore of goods and services tax, or GST, input tax credit-related costs incurred in Q2 FY27. Management said this cost was absent from the corresponding Q2 a year earlier because the relevant treatment had instead affected Q3 FY26, making the year-on-year comparison uneven.

Management said that excluding the approximately Rs 4 crore incremental GST cost for analytical comparison, Q2 FY27 EBITDA would have been approximately Rs 32.9 crore, implying growth of around 19% to 20% over the prior-year quarter. This was management’s adjusted comparison, not reported EBITDA. It also said GST cost comparability should become more consistent from Q3 FY27 onward.

What does management expect from Sterling’s new resorts?

Sterling expects newly added resorts to contribute progressively as properties mature, market presence develops and commercial performance ramps up. Management said the first 90 days of operation are a “baby phase” in which distribution channels learn the property and initial guests experience it; the more meaningful ramp begins after 90 days.

The time to mature profitability can vary with property type and opening date, according to management. A wildlife property opened in April could take six or seven months to ramp because safari demand is seasonal, whereas properties opened in September ahead of the November season could ramp in about 2.5 months. Management said a property’s ramp is generally complete within a year, after it has experienced two or three quarters or seasons.

Sterling entered October to March FY27 with a larger network than a year earlier. Management identified October to December as benefiting from festive and holiday demand, and January to March as another typically stronger period for travel, leisure, meetings, incentives, conferences and exhibitions, or MICE, and weddings. It said its operational focus is higher resort productivity, management-fee contributions, operating profitability and cash generation.

Sterling also reported being debt-free with net cash reserves of approximately Rs 380.5 crore at the end of Q2 FY27 and 27 consecutive profitable quarters. Management said this position allows investment in the network, technology, products and people while maintaining capital-allocation discipline. Those stated resources are relevant because six of the seven Q2 openings were management contracts, where fee contributions rather than property ownership are part of the intended model.

Conclusion

Sterling’s record seven openings in Q2 FY27 expanded its network through predominantly contract-led arrangements while operating metrics also rose. The business reported 23% growth in room nights, a 300-basis-point occupancy increase and 12% RevPAR growth, indicating that its larger portfolio contributed alongside improved pricing and guest volumes.

The next measure is whether the new properties move beyond their first 90 days of operation and build contributions through the October-to-March demand periods. Management expects the additions to mature progressively and said GST cost comparisons should become more consistent from Q3 FY27, making subsequent revenue, EBITDA and management-fee trends clearer.