SAMHI Hotels Limited (NSE: SAMHI) Q1 2026 Earnings Call dated Aug. 14, 2025
Corporate Participants:
Unidentified Speaker
Ashish Jakhanwala — Chairman, Managing Director and Chief Executive Officer
Rajat Mehra — Chief Financial Officer
Analysts:
Unidentified Participant
Jinesh Joshi — Analyst
Samarth Agrawal — Analyst
Prashant Biyani — Analyst
Vaibhav Muley — Analyst
Ashwini Agarwal — Analyst
Raghav Malik — Analyst
Rajiv Bharati — Analyst
Yashowardhan Agarwal — Analyst
Bharat Sheth — Analyst
Smith Gala — Analyst
Presentation:
operator
Ladies and Gentlemen, good day and welcome to Sami Hotels Limited Q1FY26 earnings conference call. This conference call may contain forward looking statements about the company which are based on beliefs, opinions and expectations of the company as on the date of this call. These statements are not the guarantees of future performance and involve regulatory risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing 0 on your Touchstone phone.
I now hand the conference over to Mr. Ashish Jakhanwal, MD, and CEO of Saami Hotels. Thank you and over to you sir.
Ashish Jakhanwala — Chairman, Managing Director and Chief Executive Officer
Good morning everyone and welcome to Sami Hotel’s Q1 FY26 earnings call. Thank you for taking out the time to join us today. I have with me today Gyana Das who’s EVP and Head of Investments Rajat Mehra who’s our CFO Nakul who’s VP Investments. We also have our Investor Relations Advisors, Strategic Growth Advisors. We have uploaded our Q1 FY26 financials and presentations on the exchanges and I hope everybody had a chance to go through the same Our objective today is to walk through the quarter’s performance, share the context behind the numbers and give you a clear sense of where we are headed in the rest of the year.
Before we get into the numbers, I want to touch on a few enhancements we have made to how we report results. We’ve simplified disclosures and moved to a consolidated EBITDA reporting without any adjustments for ESOP or other expenses and clearly mark the same store performance in orange so trends are easier to track from this quarter onwards. We are also uploading a detailed Excel file on our website which captures all of our historical financial metrics. This is about making our communication sharper and more transparent. For the first quarter FY26 same store RevPAR stood at Rs 4760 which was up 10% on a year on year basis.
It is worth noting that the month of May was very soft because of the geopolitical events and that impacted both travel and our performance. But from June onwards performance was right back to April levels proving this was a short term blip. On a year on year basis total income grew at 13% to 287 crores, EBITDA to 19% to cross 105 crores. Mark and Pat rose more than threefold to 19.2 crores. The broader macro environment Remains robust. Office net absorption across key Indian markets in Q1 was around 14 million square feet. That’s a strong base for corporate travel demand.
The four markets that matter most to us, Bangalore, Hyderabad, Pune and Delhi. NCR, which together make up over three quarters of our income base, captured 66% of the country’s total net absorption for the quarter. On the aviation side, single cities like Mumbai and Delhi saw softer demand due to the geopolitical events and also the Ahmedabad crash. But the overall travel network remains healthy with cities like Hyderabad and Bangalore demonstrating 18.5 and 9.6% year on year growth in passenger traffic respectively. I’ll now pass over the MIC to Rajat who will take you through the detailed financial performance.
Over to you, Rajat.
Rajat Mehra — Chief Financial Officer
Thank you Ashish. Good morning everybody. Our total income for the quarter stood at 287 crores up 13% year on year revenue split was roughly 42% from upper upscale and 58% from upper mid scale and Mid scale. Given our current pipeline of upscale assets including the W in Hyderabad and the Western Tribute Bangalore, this number will go towards 60% mark giving a boost to our overall portfolio revenue per key. When we break down income growth for the quarter, majority of it comes from our same store portfolio which grew at 9.1% over the same period last year.
Supported by contributions from new openings, we did see a loss of rupees five crores of revenue from discontinued operations related to asset sale in Chennai and conversion of Sheraton Hyderabad commercial space into hotel rooms. However, once the Sheraton rooms are operationalized in H2 of FY26, we should see a strong ramp up of the top line from there. On the EBITDA side we reported a consolidated number of 106 crores. Our same store assets saw a 10.4% year on year growth. We did see marginal loss of EBITDA from discontinued operations mostly related to loss of rent from Sheraton commercial space.
We maintained a consolidated margin of around 37% which is a healthy level for our portfolio mix. In the seasonally weaker quarter, depreciation and finance cost mostly remained flat. Given that the GIC capital proceed were received towards the end of the quarter, the finance cost benefits of the debt reduction will be seen starting quarter two of FY26 onwards. On the basis of this, I’m happy to report that the company reported a profit after tax of 19.2 crores for the quarter. Going forward, increase in the same store revenue, new inventory opening, stronger flow through to the EBITDA and lower finance cost on the back of the GIC REIT capitalization will further enhance our PAT levels.
Finally, from a capital structure perspective, our net debt to EBITDA now stood at. Sorry, our total net debt stood at 1,434 crores. However, accounting for the sale of Caspia Daily which we have signed yesterday, this would further reduce to approximately 1,370 crores entailing a trailing 12 months net debt to EBITDA of 3x. On the back of the strengthened balance sheet, our credit rating has also been upgraded by ICRA from an A to A with a positive outlook. With an annual interest outflow of around 135 crores going forward, we will now see a strong free cash flow generation to fund our growth endeavors.
With this I will now request Ashish to take you through the growth projects and the concluding statements. Over to you Ashish.
Ashish Jakhanwala — Chairman, Managing Director and Chief Executive Officer
Thanks. From a growth perspective, we are not just managing the portfolio we have today, we are reimagining what Sami will look like tomorrow. Building a pipeline that will transform our scale, our brand presence and our growth trajectory over the next few years. Capital recycling remains core to our approach. We have signed on the definitive documents to sell our Caspia Delhi asset for an enterprise value of 65 crores. Since FY 2023 we have monetized over 210 crores of assets at an average EBITDA multiple of 20 times.
This coupled with the 750 crore capital raised from GIC through the minority stake dilution in few of our SPVs has helped us raise a cumulative 960 crores to help us strengthen our balance sheet and create capital capacity to fund our growth. We at the same time have invested or committed to invest about 1000 crores towards inventory addition and repositioning of some of our existing hotels where we target a 15% plus NOI yield. Therefore, the shift of capital from a 5% yield dispositions to 15% investments will allow us to create value beyond the typical market cycle opportunities.
And all this being done keeping a sharp focus on our balance sheet, we have over 1000 rooms in active rebranding, expansion or development. This includes marquee additions like the W in Hyderabad and the Western Tribute portfolio in Bangalore. These new rooms in the upscale segment will transform the revenue profile of the company. We also have exciting redevelopment of the four points assets in Pune and Jaipur which will materially change the earnings profile of these hotels. We have attached some of the project’s progress and renders of these development in our investor presentation for your reference which will give You a good idea on the quality of these projects.
Outside of these secured growth projects, we continue to actively evaluate additional accretive opportunities in our core markets. Expecting same store growth of 9 to 11% and impact of new openings over the next few years. We should generate an investable surplus of over 1700 crores over the next five years. In addition to what we will require to fund committed capex, we are seeking opportunities to deploy this towards tactical M and A and variable leases. This will materially add to our existing base and augment our same store growth. To wrap up Q1, FY26 showed that our model is resilient, our markets are fundamentally strong and our strategy of disciplined growth and capital recycling is delivering results. The temporary main destruction is behind us and we are tracking well for the rest of the year.
Thank you for your time today and we are happy to take questions now.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use answers while asking your question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.
The first question is from the line of Janesh Joshi from PL Capital. Please proceed.
Jinesh Joshi
Thanks for the opportunity. My question is on our revenue growth for the month of May, which is at about 4%. But if I look at some of the markets like the Bangalore and Hyderabad, wherein we have a very strong presence, the ARR growth in the month of May was quite strong. I mean if I talk about Bangalore, it was up by anywhere between say 15 to 20%. Even Hyderabad, the growth was in the band of about 20 to 25%. So in that context our growth predominantly appears to be a bit low. And also the geography that we are present in the southern market typically was less impacted by the disruption that you spoke of.
So any specific reason for our growth in the month of May to be so low?
Ashish Jakhanwala
Dinesh, thank you so much. So you’re right. Across the portfolio what we witnessed is that only the occupancies took a dip in the month of May at the height of the India Pakistan situation. For about two odd weeks the rates actually remained pretty strong to that extent. We see rates continue to grow in high single digits to early double digits and that actually also reflects if you see in the April and June performance. So other than the month which was directly impacted, we have seen performance remain strong in the other two months in the same Quarter largely reflecting the rate growth.
So our rate growth also has been in line with what you are seeing in the broader market. Now when it comes to the impact of that particular incident we feel one of course the north Indian markets, both leisure and business got impacted because they were nearer to the conflict area. But business travel per se got impacted for that two or three weeks, which is where it has hurt us. In the month of May, other than that we didn’t see any other concerns. And as I said, as you look at June, our total revenue growth went to about 12% year on year which was about 13.6% in the month of April.
So we don’t see any reason for concern. And it was largely a dip in the occupancy because of cancellations, shifting of events, so on and so forth. We did not see any reasons to drop the rate because it was a very short term impact.
Jinesh Joshi
Understood. And secondly, if I, if I remember right, I think we opened holiday in Calcutta in the month of May and I think even 12 rooms that Sheraton Hyderabad. So I believe in this quarter we may have had some kind of an incremental revenue contribution from these hotels as well. So is it, is it possible to kind of share some color with respect to how the opening response has been to these hotels and if you can maybe specifically also share the revenue numbers just for us to get some sense as to how these hotels are doing?
Ashish Jakhanwala
Yeah, so we have, if you see slide number total 7.3 crores was the incremental revenue from new openings. The breakup of that was about 2.2 crores from Gretanoida which opened actually in the last quarter. So this quarter was the first full quarter. Hyex Calcutta, which is holiday Nexus Calcutta, which actually opened only in the middle of the quarter had just a very small revenue of about half a crore. And Trinity Bangalore, which was acquired last year did 4.7 crores. So the total incremental revenue was about 7.3 crores. If you look at the investor presentation page number 12, it does articulate the impact of the new openings.
The second part of it is about the early trends. So see Calcutta is a really good market. Our hotel is located in heart of the new town. So we actually expect a really good ramp up. H2 should be very good in this hotel. Greater Noida is a little. That market tends to be very heavily skewed towards H2 because of the very large event spaces in the Noida. Greater Noida market. We have traditionally seen that H2 is the dominant part of the year for that market. And I think just the fact that this hotel has opened has started ramping up really well.
We are quite excited about the performance of this hotel starting October for a six month period which is a peak season. Trinity Bangalore is exciting because as of the 1st of August this hotel, even though it’s not been materially renovated or rebranded, this hotel is now being sold on Marriott.com and managed by Marriott. But that transition only happened on 1st of August after we concluded some simpler renovations and it upgrade and fire life safety upgrades. Right. So now that the hotel is being managed by Marriott from the 1st of August it’s distributed on Marriott.com we actually remain fairly excited about this hotel again in H2.
Now this is slide slight bit of a pleasant surprise to us from what we had originally thought where we were anticipating this hotel to remain status quo for a much longer duration before it was renovated and rebranded. But because of our strong partnership with Marriott we’ve been able to get this to be sold on Marriott.com sooner than we expected and therefore the results should start reflecting so very early days. But I think generally we are seeing a very good response. The markets are all very very good and that I think sets a good base for the current quarter but more important for H2.
Jinesh Joshi
Got that. So just one small follow up on this bit. So if it is getting sold on Marriott’s website, has the rebranding already happened to Trinity and are we fetching the rates of Marriott currently or maybe from 1st of August are those rates that are into place.
Ashish Jakhanwala
So remember Trinity is not the final brand. Trinity is the brand that the hotel was carrying before rebranding. So this is an intermittent phase where the existing brand is being distributed on Marriott.com, we obviously expect to get some benefits on how we are distributing, revenue management and all of that. Eventually the hotel will be rebranded as a part of the tribute collection Ganesh which is still due. So this is an intermittent step otherwise we would have just held this hotel as Trinity self managed for a period of time. All we have done is made sure that this hotel is now managed by Marriott and sold on there website and part of the Bonvoy program.
Eventually this hotel will get fully renovated and rebranded. But that’s in future. For now it’s fully operational with a slightly different structure that we had originally planned for and which I think will work well for this hotel.
Jinesh Joshi
Understood sir, thank you. Thank you so much and all the best.
operator
Thank you. The next question is from the line of Samarth Agarwal from Ambed Capital Please proceed.
Samarth Agrawal
Hey team, am I audible?
Ashish Jakhanwala
Yes Amar.
Samarth Agrawal
So just a couple of questions from my side on Caspia Delhi which we recycled during the quarter. What kind of EBITDA was this asset making in FY25 and why was it the case that an asset which was not doing that, the asset was not doing that well despite being present in a in a tier one location.
Ashish Jakhanwala
So Samad, two points. First, the hotel actually was not producing an ebitda. It had resulted in a net loss, operating loss of about 15 million 1.5 to 2, 1.5 crores. 15 lakhs FY25. 15 lakhs in FY25 was the net loss from this asset. Having said that, the peak EBITDA from this asset before that was about. So 3 crores was a peak EBITDA. Then we actually put the hotel into a graded shutdown because it was not performing well but yet the holding cost was about 15 odd lakhs. The second part of your question as to why this hotel was not doing well actually a couple of reasons, some which we inherently like as a company which is poor product, lack of brand and this is a textbook standing opportunity.
So one would argue why have we sold the asset instead of doing what we do. The biggest part was that while it is when you look into Google Maps Delhi, it’s actually north of Delhi where the business profile is very different to the business profile that we are used to. Number one, it is heavily driven by food and beverage. This asset was a part of a mixed use development which did not allow us to create the right size and capacity of food and beverage to attract what is the core business there. And two, we follow these two key themes of demand being driven by business travel, both office space and airline.
And while NCR benefits from that, but not Delhi was in a bit of an aberration where majority of my customers were not really coming from the sort of businesses that we typically serve. We felt that even if we were to undertake the renovation of this hotel which would have costed us incrementally about 15 to 20 crores and a sale price of 65 if you would look to 80 crores of opportunity cost and we typically solve for 15 to 20% NOI yield, we were talking about the bid of that hotel to be in the zip code of almost 12 to 14 crores and we couldn’t underwrite that EBITDA in that asset in the forecast period.
And of course I’m sure it will come at some point in time and therefore we felt that this is A very good candidate for extracting our capital out. And we continue to find really good opportunities in core markets like rest of Delhi, I’m saying, which is where we have the core corporate demand. Bangalore, Hyderabad, Pune, Mumbai. So we actually wanted to make sure that we take the capital out from an asset where our yield will always be suboptimal and keep that capital prepared to be deployed in markets which will be far more accretive for us.
Samarth Agrawal
Understood? Understood. And just one last question from my side. Iqra upgraded your long term outlook recently. I think Rajat referred to that during his opening remarks as well. Given this and the recent repo cuts, what kind of stabilized interest cost are you expecting by let’s say FY26 and then what would be the quantum of savings from just the reduction of interest rates?
Ashish Jakhanwala
I’ll ask Rajat to add. So first of all we have already seen almost a 30% reduction in our finance costs. They’ve gone down from 195 crores to about 135 crores. So that’s about a 30% reduction. Current interest rate which is average blended interest rate is at about 8.5%. The third data point which is important is the marginal cost of borrowing. At what cost are we borrowing recently and that is in the zip code of 8.2% or so. 8.2, 8.25%. Right. So we’ve already seen that given our strengthening of the balance sheet, consistent delivering the numbers that we had indicated, leverage of course going down we have moved from what used to be a really high pricing to about 8.5.
We think incremental financing and refinancing will happen in the zip code of 8.2. We do continue to seek nothing short of 12 to 15 year financing summer and there is maybe a 10 20bps premium to be paid for that vis a vis if you were to borrow a five year or six year financing. But we know this business, it requires long term financing with very little repayments in the first three to five years to make sure that from a cash flow perspective you’re fortified. So you know we are happy to pay a 10 bis premium for that if need be but we are at this point 8.5 going down to 8.25.
If you were to ask me a guidance towards where we should be towards the end of FY26 we think we should be targeting around 8.3, 8.35 because there will be some legacy loans which we can refinance but there are certain costs attached to that and the cost Benefit of interest saving and what is the caf cost attached to that sometimes doesn’t justify in the short term FY27 which is when we think will be more equipped to deal with some of those legacy financing, we should target the financing to come down closer to 8.1% in the current interest rate regime.
I obviously I’m not qualified to comment on where the interest rates are headed but in the current interest rate regime we think it should be closer to about 8.1% all inclusive long term between 12 to 15 years.
Samarth Agrawal
Understood. That’s all from my side. Thank you.
operator
Thank you. The next question is from the line of Prashant Biani from Alara Capital. Please proceed.
Prashant Biyani
Yeah, thank you for the opportunity. Sir, in the presentation you have mentioned in line as we grow Sami into being a market leader and then it continues. So what kind of market leadership are you looking at? Will it be in terms of number of rooms in a particular segment or it would be about profitability or something else. If you can share some tangible measurable benchmarks which will define your leadership.
Ashish Jakhanwala
Very good question, Prashant. Not easy to answer but I’ll try. I think one thing we want to be clear is we don’t chase vanity numbers and which could potentially be the number of rooms. So we clearly not claiming that we will be the largest in terms of number of rooms because it all depends on the segment you’re investing. It all depends on the market you’re investing. It all depends on the quality of assets you’re investing. I think when we talk about market leadership we’re talking about our relevance within the hotel industry in terms of total revenue and therefore total profits.
And why are we so confident about saying that we are targeting Sami to be a market leader is obviously explained in subsequent slides. So we closed last year at a reported top line of about 1100 crores and an EBITDA of 425 our packed for some 80 odd crores. What’s happening in the next three years is quite exciting and also even more exciting is the fact that a lot of it is already in our hands. First is the growth of the portfolio going from 4,600 rooms because of the addition of w the Westin and Bangalore and some other projects.
The second is the transformation of some of our mid scale portfolio into the upscale portfolio. So if you look at I’ll get to the slide number. Basically the stated the installed capacity that we have in our portfolio right now and if that was to operate at FY25 average rate. FY25 RevPAR this portfolio should have delivered about a 1500 crore top line. So which means we do not buy anything, we don’t have to use our future cash for anything else. Yet this company without any growth in RevPars from FY25 levels will get to our top line of about 1500 crores which is almost a growth of 40% from where we are right now.
And EBITDA Target will be about 600, 630 crores because of this growth that we are seeing. And these are investments we’ve already made double Hyderabad, best in Bangalore, so on and so forth. We’ve said them several times and we are continuously seeing the same store growth to be in the zip code of 9, 10, 11%. Now I’d like to reemphasize on that. And even though we know may was really bad, what is heartening to see is in spite of almost 1/3 of a quarter being significantly impacted the same store revenue growth maintained that high single digit number.
That only gives me a confidence that perhaps when we say 9% to 11% we are erring on side of being too cautious because in probably one of the worst quarters because of a geopolitical event we still delivered a 9.5% same store total revenue growth. If you were to just calculate that 9 to 11% same store growth for the next 3 to 5 years, add the new inventory that we are committed to add and we don’t have to buy anything. We actually expect that our total revenue should get to about 2,200 crores to 2,300 crores. This whole expansion leaves us with one gift and that is 1700 crores of investable surplus.
And I’m talking about investable surplus. After accounting for the money we need to spend to complete the W in Hyderabad and the Westin and the renovations and all of that. Now one thing Sami has delivered in the past is actually growth. We’ve demonstrated that we have the ability to find the right M and A opportunities at the right price. We’ve demonstrated our ability to secure long term leases which are highly capital efficient. One thing we suffered from in the past was our balance sheet and that was a factor of a young company growing fast right? Today I see Samy more as a mid, I would say a mid cycle company which is mature does not need to rely on external capital.
Whole of that growth is being funded from internal accruals. So Prashant, when I put all of this together right and I look forward for next three to five years, I actually think that our Target here is to position Sammy amongst the top tier of hotel companies in India in terms of total revenue in terms of ebitda. And of course it will flow down to earnings because as I said, all of this is being done from internal accruals or capital recycling and not from leverage. So you’ll see interest rate, interest costing, stable or going down. Right.
And everything else expanding. So sorry for a long answer to a simple question, but that’s how we articulate our statement of saying we wanted to be established as a market leader.
Prashant Biyani
So thank you for the clarification. And secondly sir, on CNBC in the morning, you had, if I heard you correctly, you mentioned that we may potentially transfer two assets from Sami to GIC platform. So why would you want to transfer ready established assets if that is the plan? And why not use GIC platform itself for organic greenfield growth as capital from that platform will be more patient capital than the Sami. If I have to say it that way.
Ashish Jakhanwala
No, no, no. So what we are intending to say is we’ve already confirmed that our upscale growth will happen through the GIC platform. Obviously I have to caveat it by saying that will really depend on the deal being liked by both us and gic. Right. So assuming that is the case, the GIC platform will be the principal vehicle of growth of the upscale hotels for us. We believe there is an opportunity and there’s an optionality more than an opportunity for us to transfer one more asset to that joint venture and which will basically allow us to recapitalize that joint venture with incremental 350 to 450 crores and giving us the buyer power for growing that joint venture.
So it’s an optionality we have. And I think it is important for a company like ours to keep options to fuel future growth with that debt not being that option. Right. Let me be very clear. So other than leverage, we want to make sure all options are available for us to grow the company in future. And potential ability to transfer one more asset to the joint venture to recapitalize that with additional capital is just one of the options.
Prashant Biyani
Okay, sir, thank you. That’s it from my side.
operator
Thank you. The next question is from the line of Weber, Molly from yes, securities. Please proceed.
Vaibhav Muley
Hi Ashish. Sir. First of all, congratulations on a strong set of numbers. My first question was on your. You had mentioned earlier that there is an opportunity for Sami to onboard an investor similar to GIC for your mid scale portfolio. So is there any development on that front?
Ashish Jakhanwala
No, too early. I think Vaibhav that again, as I said, capital recycling is core to how we see will create value in the long term, beating the market cycles. But at this point of time, I don’t want to talk much because there’s no conversation.
Vaibhav Muley
All right. And regarding your Navi Mumbai litigation, have you received the outcome from that litigation and when do you expect that project to commence construction?
Ashish Jakhanwala
So the matter is still under discussion. So it will be unprofessional for me to raise hopes. Having said that, there’s no reason for any concern. We have maintained a very healthy dialogue with the administration. We have made applications. We’d like to believe that given our merits and our credibility, we should be able to sort out all issues by the end of the year and then commence work on that project.
Vaibhav Muley
All right, sir. Lastly, on your
Ashish Jakhanwala
market, sorry, Weber market will come to know as we formally resolve that because we’ll make an announcement and that also will require us to write back the losses we had taken in that fiscal year.
So don’t worry. The moment we receive a formal notification, we’ll intimate the markets about it.
Vaibhav Muley
Perfect. And lastly, on your asset recycling strategy. So post sale of Castia now, I think most of the properties remain core to our operating portfolio. So can we expect any more such asset recycling plans in the near future or do you think now asset recycling is more or less over?
Ashish Jakhanwala
No, asset recycling will on a very selective basis. We still think there are markets and assets where we can extract capital. You know, if you look at our. Yeah, I mean I think we were.
Yeah. If you look at a slide number 26, we had indicated about 200 crores from asset recycling, 65 is done with the Delhi sale. And we think this still keeps the window open for incremental about 130 odd crores of asset recycling in future, but no near term guidance on that. We believe we’ll get it done in the period that we have indicated, which will further bolster our ability to invest that capital elsewhere.
Vaibhav Muley
All right. And just related to your asset recycling of Caspia, so New Delhi as a market, will that remain focused going forward or do you want to focus on your co market, that being Bangalore and Hyderabad?
Ashish Jakhanwala
No. So core markets, but I’ll clarify, the core markets is Bangalore, Hyderabad, Pune, Delhi, Bombay, Chennai, to some extent Calcutta, all the large metros which have large office space and airline passenger traffic. Right. So yeah, we are looking at all of those markets.
Vaibhav Muley
All right, thank you so much.
operator
Thank you, ladies and gentlemen. In order to ensure that the management is able to address questions from all participants in the conference Please limit your questions to two per participant. The next question is on the line of Ashwini Agarwal from DMETER Advisors. Please proceed.
Ashwini Agarwal
Hi, good morning. Could you just share what is the scale of ebitda from the four operating properties that are now 35% owned by GIC?
Ashish Jakhanwala
Just a second. So total EBITDA from GIC asset on a trailing twelve month basis is. 194 crores.
Ashish Jakhanwala
194 crores.
Ashwini Agarwal
For the trailing twelve months. 194 crores. How many did you say?
Ashish Jakhanwala
Sorry. 130 crores. What is that? 194. 134 crores.
Ashwini Agarwal
130. So out of the roughly 425 crores of EBITDA last year, 130 odd crores is from properties that are now co owned by gic?
Ashish Jakhanwala
That’s right.
Ashwini Agarwal
And do you have kind of a Rofer type of arrangement with GIC that any new upscale property that you pursue will be jointly developed unless they pass. On it or something along those lines?
Ashish Jakhanwala
That’s right.
Ashwini Agarwal
Okay, so it becomes kind of a balance sheet that’s available to you for a 35% capital infusion, but that happens at a cost basis. It’s not that you develop the asset and then you roll it down into this gene. Would that be a fair assessment?
Ashish Jakhanwala
No. So each asset will obviously will present the economics of those assets. So for instance, even in the Bangalore asset that we acquired recently, because of the work which had been done, we had, you know, it got revalued at about a 30% premium. In addition to that, we are entitled to a development fee. So all put in together, we want to make sure that the economics for our efforts and our investment, if I may use the word loosely, intellectual property to acquire is well valued. But yes, generally any new asset will come at a ground floor level.
Having said that, if we were to transfer any existing upscale asset, the valuation discussion will be afresh very similar to what we have done for Courtyard or High Clearance Pune. And there we want to make sure that the valuation reflects a fair value that we need to deliver to our shareholders.
Ashwini Agarwal
Yeah, so I want to come back to that first piece that you said. You know, how do you realize the IP for locating an asset, for developing an asset? So you said that there’s going to be a development fee that you will collect. And then you said something else which I missed.
Ashish Jakhanwala
So there are both things. There is actually three things to it. There is a development fee, there is an asset management fee which is obviously Providing a platform to the joint venture to even though we are majority owners, but yet the minority shareholder is benefiting from the platform that we have set up. So there is an asset management fee that we charge from the platform in addition to the development fee. And last but not the least, as I said, each deal will have its own economics. And those economics may include us acquiring an asset at a point of time, undertaking certain work that we do and then transferring it to the joint venture and for which there will be a certain price.
But as I said, all of that will be on a case to case basis depending on the risk and reward profile that we see for each asset. But to summarize, I think we wanted to ensure that a we have access to really high quality capital to grow our upscale. And upscale tends to be more capital intensive than the rest of our portfolio. I mean look at Courtyard, look at the Western Tribute Bangalore. It’s about 15 million per key, 1.5 crores per key. Whereas some of our leased hold assets or in mid scale will be just as low as 50 lakhs per key.
And to that extent, by the way, Sami operates still in a bit of an archive world. Our cost per key that we talk about for investments I think are stuck in time. But we are happy with that. We’ve seen the markets move to a level where we are finding it difficult to underwrite acquisitions but we continue to find what we need to do. Second, we get the benefit of very high level of governance and diligence from a partner like gic. And trust me, that is equally valuable as the company starts deploying a large pool of capital.
We run a professionally managed company and therefore it’s even more important for us that when we deploy capital we have the ability to get that tested from multiple sources. Again, I’ll repeat, there is capital concentration in upscale portfolio. And when we do that jointly with gic, if we do that, it brings that additional layer of whether or not we do it with them. One thing is certain, we’ll get it vetted by them. So I think there are many intangible benefits beyond the ability to get that additional capital.
Ashwini Agarwal
Okay, thank you so much. All the best.
operator
Thank you. The next question is from the line of Raghav Malik from Jeffries. Please proceed.
Raghav Malik
Yeah, hi. Thank you for the opportunity. So firstly you mentioned in your opening remarks that because of some of the renovation at Sheraton Hyderabad currently there was some impact on revenue and revpar growth for you know, this quarter. So compared to this 10% number, if you just exclude that from this maybe like what would the revpar revenue growth have been for this quarter? You could share
Ashish Jakhanwala
so the total if. You see and there is an adjustment of about. Let me take it for the numbers. Actually There was a 2 crores in a quarter impact of the shutdown of those two floors which have been converted from office to hotel rooms. And then there was about 2.8 crores. In fact if you were to compare last year to this year which was largely the revenue from four points Chennai which was sold earlier. Right. So total if you see there was 4.7 crores of revenue from what we call sold or discontinued operations. And that’s the impact. What is interesting is that just a 2.8 crores or sorry 1.9 crores a quarter loss in Sheraton Hyderabad which will continue in current quarter.
Also the room should open well in time for I would say Q4 if not Q3. The number of rooms being added is actually about 42. So that’s a significant increase in the inventory in that hotel. And we are adding those rooms at just about 50 lakhs per key. So this is the total revenue per key today is about 50 lakhs per key. So we are actually seeing pretty different profile from these two floors relative to the 1.9 crores we earn used to earn on a quarterly basis. Right? Yeah. We think it is going to multiply multifolds when those rooms are ready.
Raghav Malik
Sure. Understood. Not revenue. You’re talking about 1.9 crores on the EBITDA front, right?
Ashish Jakhanwala
Yeah. Because it was an office space. It flew straight to EBITDA because there were no expenses attached to it, you know.
Raghav Malik
Okay, okay, understood. And just on the cost front, so I mean just bookkeeping but the FNB and employee cost is shot up pretty significantly just compared to revenues. Is there some part of this that’ll be normal? Is it like a bit of a structural change? Anything you could get.
Ashish Jakhanwala
No, I think largely you’re seeing an aberration because of the dip in the month of May. And also what has happened is that we have these new hotels which have opened and when the new hotels open there is some bit of a preopening expense which gets into the P and L because in the first quarter of a hotel they will end up. There’s hiding expenses and all of that. So combination of the pre opening expenses and the fact for the new hotels which is Calcutta and Greater Noida and the fact that we had a sudden dip in the month of May which was obviously it was known earlier one would have taken corrective action because the dip happens for about two to three weeks, you know, we couldn’t take the corrective action.
That’s why you see some bit of a change in the cost. Otherwise on a normal basis, you’re not seeing any concerns on either of those two cost line items, you know.
Raghav Malik
Okay, okay, understood. Thank you. Thank you and goodbye.
Ashish Jakhanwala
Thank you.
operator
Thank you. The next question is from the line of Rajiv Bharti from the vama. Please proceed.
Rajiv Bharati
Yeah, thanks for the opportunity and then thanks for sharing that Excel. Great job on in terms of disclosures in that, can you explain Rho L60 what this corporate income which is what, 139 million and the overall net corporate GNA is basically a positive number. Can you explain how is that coming?
Rajat Mehra
Hi, this is Rajat here. So you know, this is a one time index income which is on account of conversion of a convertible instrument that we had in one of our subsidiary to equity. You know, so this is at the time when this money initially came, there was a total breakup of that money which was done into an equity portion. And also in terms of a liability, that liability had a certain number while the value of the instrument while it was converted was lower. So the liability had to be actually written back. And that’s the one time adjustment indes entry that is appearing in the corporate income.
Ashish Jakhanwala
Rajiv, what is also important is and sometimes under indes, only a partial view is there. So while there was a one time income because of the GIC transaction, and that was because in Ascent Hotel where GIC participated at 35%, there was an earlier minority investor where he had a convertible instrument which was settled. So their income came. But at the same time, interestingly, there were expenses also which were with respect to the GIC transaction. But unfortunately or incidentally, they don’t reflect in a separate line item. And those expenses are largely on account of the ROC fee because we had taken equity investments in these subsidiaries and in some of the subsidiaries we had to increase the authorized capital.
So there was also another two and a half odd crores of incremental expense that came because of the GIT transaction. These expense and income are all with respect to the GIT transaction in the last quarter.
Rajiv Bharati
And with regard to Caspian rate and Noida, which you had converted, what was the total capital employed? I mean to start with and what was the conversion? Because you said for New Delhi you said 80 crores. And I remember in Q3 you had said that it’s 10 lakh per key. I thought it was 12, 15 crores.
Ashish Jakhanwala
So the renovation expense in New Delhi would have been about 15 to 20 crores. 65 crores is the sale price. So when we look at opportunity cost we had to decide today that if we hold this asset we need to at minimum solve for a 15 to 20% Rossi on what is the opportunity cost which is 65 and the incremental capital being deployed. Right. So we were comparing it to total opportunity cost not just the renovation. The renovation cost will be in the zip code of 15 to 20 which is for 142 room hotels. So that’s about 10 lakhs per kilo employed. 23 crores. 23 crores. March 25th we do it annually for Britain order. Total Capital employed is 23 crores and.
Rajiv Bharati
The annualized ARR is what? 4070% occupancy. How’s it clocking for Great Denoida.
Ashish Jakhanwala
Yeah, great Denoida. You’ll underwrite at about 4,000 rupees occupancy of 70, 72%. That is what you would underwrite for Grit and Noida.
Rajiv Bharati
So that is, it is about 40% Rosie in terms of.
Ashish Jakhanwala
Yeah, so listen Rothis and Holiday Inn Express tends to be really high. I mean if you look at for instance Holiday Inn Express high Tech City Hyderabad, FY25 rotary will be and Nakul will correct me but should be upwards of 40%. So that’s what we are kind of trying to explain that when we are extracting our capital from some of the assets where after all the hard work and 65 crore sale price, 15 crore renovation we would have gotten to let’s say barely 10% we find that the same money can be taken in other assets whereas potentially we are solving for much much higher roses. So you’re absolutely right. Capital employed in some of these assets is really low.
Rajiv Bharati
So the external question is if, if you were to let’s say sell this asset, let’s for 70 odd crore. So that, I mean that is, I mean we are not hooked on to that S40%. We will milk it for some more years and have it at little 70, 80 crores. It’s, it’s sellable, right? Or is it not?
Ashish Jakhanwala
We’re not traders per se. I think the question we’ll ask ourselves is at the sale price and plus incremental capex that that hotel may require what is the sort of EBITDA we can generate. So we’re not traders of the asset. Let me be very clear, people should not expect that we keep buying, selling hotels. That’s not our Job. Right. We would as a management team and a board on a periodic basis take a call on if our investors money is invested in the right assets and if there is, if there is a better opportunity to deploy that capital.
At this point of time we were very convinced and the sale of Cashew Delhi was debated at board for two board meetings. Right. We realized that we have to take a call of this 65 that we’re receiving from Caspia sale plus what we would have invested of about 1520 in renovation. What should we do with that 80? Get it invested in Casper, remain invested in Casper, take it elsewhere. And just a Roasty profile told us that what we have as an opportunity, let’s say in Hyderabad or Bangalore is far more accretive and with a huge margin of safety.
And therefore the call was unanimous. But other than that we’re not short term traders of assets. We believe Greater Noida is only going to grow from the current level. It is the start of the Delhi Mumbai Expressway. The UP government has taken substantial steps to increase the industrial activity in Greater Noida. We are sitting on an asset with a capital employed of 23 crores. And we therefore feel this is a prime asset which can potentially help us overall improve the royalty profile of Sami. I mean it’s a small asset but each small asset contributes to the future success.
So I think Grandernoid is a market that as of today we remain very excited about. I think it’s just the start of the performance of that market, you know.
Rajiv Bharati
Perfect. Thanks a lot for the information and all the best. Thank you.
operator
Thank you. The next question is from the line of Siddharth from Fidelity international. Please proceed, Mr. Sadhan. Mr. Sadant, your line has been unmuted. Please proceed with your question. Due to no response we move on to the next question. The next question is on the line of Yashawardhan Agarwal from IIFL Capital Services. Please proceed.
Yashowardhan Agarwal
Yeah. Hi. Thanks for the opportunity. Also, if I look at our total revenue and there’s an observation that SMB revenue is growing at around 7% versus refer or 12 or 13%. So is it fair to assume that FB revenue is going to grow in the similar life? And if not then what are the steps taken by us to improve it?
Ashish Jakhanwala
So in the past few quarters we had seen that FNB was a bit of a drag on our same store growth. This time we’ve seen that while in the same store we have seen a total revenue growth of about let’s say 12% in upscale, 11% in upper mid scale RevPAR growth room revenue growth F and D growth was in the range of about 7 to 8%. And that has led to the total revenue growth of about 9.9 10%. So FNB growth is in line to what we expect. It is slightly lower than the revpar growth in the current quarter.
But also this is a quarter when a lot of events don’t happen. Don’t forget a large part of our FNB income in our hotels is driven by corporate demand mines and similar events. And unfortunately because what was happening geopolitically those are the events which take the biggest hit. So we have seen a reasonable growth in food and beverage our mid scale. Interestingly where you see our dependence on mice is less. The FNB growth actually has been pretty decent, you know.
Yashowardhan Agarwal
Okay, got it sir. And so if I look at the presentation it is given that we are going to do cakements of around 880crores between FY26 till loss fit if I 30. But can you please give me year on year number for 26, 7 and 8.
Ashish Jakhanwala
So year on year. So we are currently estimating an annualized capital expenditure of circa 175 to 200 crores. It’s quite well spread this year our capital expenditure is largely towards completion of the additional inventory in Sheraton and quite Regency. Plus the work that we’re doing in W Hyderabad. Next year we will see. I mean that work is largely done this year next year and total W expenditure for instance is about 175180 crores right. Sheraton and high frequency large part of capital has been invested already. Only some is trending over the next month and a half, two months next year we will see again the same run rate of about 180 crores to 200 crores.
That’s towards commencement of work for the Westin in Bangalore. The conversion or completion of W and commencement of work for the conversion of Pune and Jaipur assets. A year after that we’ll continue to see the investment in the WI in the western Bangalore and completion of this renovation. So analyze expense will be on an average about between 180 crores to 200 crores to 200 crores.
Yashowardhan Agarwal
Got it. So pretty much here and this is the last question from my side on the expansion plan. How is it going for the inspection plan that we have announced for FY26 and when can we expect that to go live? And same question for the W Hyderabad as well. And if you can share this some additional numbers on the W Hyderabad that what is the Revenue or EBITDA per key that we are expecting.
Ashish Jakhanwala
Okay, so let’s go year by year. So this year we are ready to open the additional rooms in Sheraton and Hydrogen Sea. Total inventory in between these two would be about 75 rooms. Current revenue per key for these hotels will be about 50 to 55 lakhs per key. So you can say that about 75 rooms at. So that’s about 40 odd crores. Sorry 75 rooms into 5.5 million for the year. So about 41 crores annualized intact. And because these are incremental inventory in existing hotels we expect a flow through of about 60%. So almost 60% of that at minimum will get flown down to your EBITDA.
So that’s about 25 crores on an annualized basis. The W Hyderabad is progressing quite well. The work is happening on. It’s already building actually so it’s more a retrofit project. We started the work on site. The design development is largely done. This market is really good our competitive. So we have a Sheraton in financial district which is about half an hour away and typically financial district sells at about a 15 20% discount to Hitech City. But just the Sheraton itself is selling at a similar revenue per key. And in this case yeah 65 lakhs ought per key should be the revenue profile.
So you should expect an incremental revenue of about 110 crores from this hotel. But caution this hotel opens in FY27. We should expect that FY28 is the first full year of operations for this hotel. Market remains very very good. No new inventory getting added, office space growth continues. So we actually expect that the revenue per key will continue to grow in this market as we open that hotel. And then of course we should remember that the Trinity Bangalore which was doing approximately and 20 crores a key. 20 crores a year top line. We actually expect that hotel to at least show a 30% growth in the current in the next 12 months.
Let’s not the current fiscal because the Marriott management has only started on 1st of August. So let’s say for next NTM basis September till next August we actually expect that revenue from that hotel without any renovation or rebranding should grow at about at least incremental 25 to 30%. So that’s really the near term project. And then in future of course we are very excited about as we open the Westin and Bangalore. That market is very strong. That hotel should be at least 220 new rooms. Added to the current trinity and that market is easily in the same zip code of about 5 million to 6 million or 50 lakhs to 60 lakhs per key total revenue.
operator
Thank you. The next question is from the line of Siddhant from Federity International. Please proceed.
Unidentified Participant
Yeah, can you hear me now?
operator
Yes sir.
Unidentified Participant
Yeah. No, my question was around the FNB growth for the quarter. I think you answered it in the previous question but could you just tell me again the FNB growth? And also I wanted to understand on the initiatives which you have been talking about in FNB for, you know, last few quarters, you were talking about the FNB growth will be better in the future. So just wanted to understand how are those things going and what is the FNB growth we can expect in the Future.
Ashish Jakhanwala
So the FNB growth for the last quarter was about 8% year on year. And this was in spite of the meeting spaces in Hyatt Place, Gurgaon, Sheraton Hyderabad and partly in hydrancy Pune being provided for selective renovations. All these three spaces will be ready to actually hydrated Gurgaon will be ready literally in the month of September. So by end of September that place is reopening for business. Sheraton Hyderabad should get done by October end. And same is the timeline for Hydraulic Pune. Hydraulic pun is much lesser intervention actually than the rest two.
So we actually expect that in H2 when the three upper upscale hotels have their refreshed boardroom spaces, we should expect the FNB revenue growth to start comparing to the revpar growth same store which is in the zip code of let’s say 10, 11%. So FNB growth should grow from current 8% to about 10 to 11% due to those changes.
Unidentified Participant
Yeah, thanks. That’s all from my side. Thank you. Thank you.
operator
The next question is on the line of Bharat set from Quest Investment Advisors. Please proceed.
Bharat Sheth
Hi, thanks for the opportunity. And since my one question is that what level we bring, what stage, Sorry, while in new property. GIC management team Right from.
Ashish Jakhanwala
Bharat, we are not able to hear you properly so can you come closer to the mic?
operator
Due to no response we move on to the next participant. The next question is from the line of Pranav from PIMC Wealth Advisors. Please proceed.
Unidentified Participant
Prabhup.
Ashish Jakhanwala
Yes, Pranav.
Unidentified Participant
Yeah, hi sir, I just had a couple of questions. So going forward can we expect our debt to be around the range of let’s say 1380 by the end of this year?
Ashish Jakhanwala
Yes, I think your net debt will remain in the zip code of 40. Let’s say 1400 crores. There will always be quarterly shifts in the cash because of the capex. So I would think we should maintain a 1400 crore or.
Unidentified Participant
Crore or net debt. And so as for your slide, so can we expect around 60 crore of debt being repaid every year let’s say till FY50?
Ashish Jakhanwala
Yeah. So there is a total reduction of about 300 crores over the next five years and that is as per the current contracted repayment schedules, you know with some refinancing in place. So the total repayment is about 300 crores over the next 5 years.
Unidentified Participant
About 60 odd crores. Repayment. Net repayment every year.
Ashish Jakhanwala
Every year. Correct.
Unidentified Participant
Understood. And secondly, so could you throw some light on a corporate DNA expenses. Is that like a percentage of our revenue or is that expected to remain in several lines? Yeah.
Ashish Jakhanwala
So if you see a large part of the corporate GNA is actually the salaries and wages of the corporate employees. For FY26 those salaries and wages are seeing a marginal growth of about 3.5% over the last year. So we have kind of maintained the corporate expense growth at a significant lower level than where the revenues of the companies are growing.
We always believe we were well capitalized in terms of team for a much larger revenue base. So that’s to referring reflecting now. So that’s the salary and wages, large part rent and administrative expenses remains very stable. So really we are not seeing any significant growth in the corporate gna. Really.
Unidentified Participant
Understood. And for the full year can we expect around 10cr of ESOP expenses?
Ashish Jakhanwala
Of what ESOP? Yes. So that’s already accounted for in quarter one also. So if you see both the note on the financial summary slide and the Excel sheet it has been uploaded on our website it’s 2.4 crores per quarter.
Unidentified Participant
Okay. Okay. And for FY27 can we expect the ETHAP cost to come down in within single line?
Ashish Jakhanwala
Okay. So based on the current grants that have been approved by the shareholders it will come down from 2 point a quarter to 1 crore a quarter. But you know we need to be mindful that the NRC may recommend if at all any fresh ESOPs at this point of time. You are right. It will go down from 2.4 crores to 1 crore a quarter. And we should maintain that one more. What I’m saying is beyond FY27 we should maintain that. Right about that, about 10 or 12.
operator
Thank you. The next question is from the line of Bharat Seth from Quest Investment Advisors. Please proceed.
Bharat Sheth
Hi. Thanks for the opportunity. Once Again, sorry, my line got dropped. ASIF question is that what stage we involve GRC platform for new property from the day we select the site or if you can give little more color. And what are the our GIC spirit and kind of ROI on the same platform? And how do we manage our interest of minority?
Ashish Jakhanwala
My apologies, I’m not able to. The line is not clear. I’m not able to really understand.
Bharat Sheth
Hello, Sorry.
Rajat Mehra
Do you really involve gic? Okay. For them to come and pick up a particular asset and what’s the kind of return profile we look at when we decide?
Ashish Jakhanwala
Okay, so I think Rajat has. Thank you, Rajat. So he said two questions. One is at what time do we decide to go to partner like gic? And the second is what sort of a return profile do we underwrite for new acquisitions? Correct.
Bharat Sheth
Correct.
Ashish Jakhanwala
Okay, thank you. Okay, so first in the timing of the discussion for new acquisitions, we will remain in real time discussion with GP and upscale assets. The joint venture is specifically focused on upscale. So as we look at evaluating opportunity in the upscale space, we will in parallel discussion such opportunities with gic. That’s our contract. In terms of returns, we typically underwrite mid teen return on capital employed or NOI yield. I mean, for us, NOI yield in the initial years is a more right indication because it ignores depreciation both in numerator and denominator. ROTHI is important because that’s a real return in the long term.
So we look at both the numbers, but we solve for a near term NOI yield of about 15% and a long term Rothi of 15%. Right. And the gap between the two will be about two years or so. So that’s the sort of basic underwriting that we do when we look at deploying fresh capital.
Bharat Sheth
And how do we manage, I mean the interest of both, I mean our minority shareholder of Shami as well as gic.
Ashish Jakhanwala
No. So as far as both, in all fairness, our interest is protected because we are responsible for deal origination and underwriting. And therefore we would like to believe that we will only pursue opportunities which work well for our shareholders. When it comes to gic, it’s a very high quality institution. And therefore when we take the opportunities to them, they obviously look for their own point of view in terms of how they’re solving for returns and the quality of assets. The good thing is that it has therefore gone through a dual lens of governance. One, at Sami’s level and our board and our investment committee.
And two, from a git’s perspective and case in Point is the Trinity Hotel in Bangalore where first we acquired it and obviously it went through a fairly detailed discussion and diligence at our end. And we paid 205 crores for acquisition of that asset. We believe that asset in future is 100 crore potential EBITDA against a 600 crore total investment. So it kind of follows our return profile. But having said that few months later this was again re vetted by the GIC team and therefore that company, their 35% stake will be issued to them at a pre money value of about 275 crores.
And that really reinforces our purchase price selection and decision that what we paid for that asset is well appreciated by a very high quality institutional investor who themselves have multiple layers of betting and opportunity. So I think rest assured when we are deploying capital we are making sure there are multiple layers of value validating what that opportunity could be. And I will reiterate therefore that if you look at the cost per key that we have committed, let’s say in W Hyderabad which will be let’s say a crore 10 lakhs per key or a Westin tribute in Bangalore which will be at about 1.6 crores per key, it continues to remain at a significant discount to both replacement costs which is the cost at which you will build similar hotels in same location and 2 the market price per key that we are seeing for private transactions which in the upscale space has remained upwards of 2.5 crores going up to 3 and a half to 4 crores per key.
So we do believe that in the long term we are creating value for our shareholders by keeping to our discipline of investing our capital at a significant discount to replacement cost.
Bharat Sheth
Okay. Thanks for the detail sir and all the best.
Ashish Jakhanwala
Thank you.
operator
Thank you. The next question is from the line of Smith Gala from RSPVN Ventures. Please proceed.
Smith Gala
Yeah, thank you for the opportunity. My question was related to the employee expenses. We have seen a slight uptake in the run rate. So can you throw some color on it and can this run rate hold for the full year without without any increase?
Ashish Jakhanwala
So if you compare on the front page of financials where the employee expense has gone from 175 crores to 216 crores. Right? That is on account of the new hotel Greater Noida, Calcutta and the Trinity. So large part of that growth is on account of actually the addition of new hotels. And obviously because these are new additions they’re not reflecting their true potential of performance in the revenue. So in the short term you’ll See, even as a percentage, that number moving slightly up, but otherwise on a same store basis, we’re not really seeing any reasons for concerns in terms of employee expense growth.
Smith Gala
Okay, that was helpful. Secondly, the room revenue to total revenue for this quarter was approximately 79% as the same number for the quarter one of 25 was 71%. So can you throw some light? Why the room revenue is as a percentage of total revenue is increasing and can it improve?
Ashish Jakhanwala
Yeah, that’s because of the shutdown of two ballrooms, which is Hyde Place, Gurgaon and Sheraton Hyderabad. A large part of that impact. And two, also the fact that we’ve opened the Holiday Inn Express in Calcutta and Holiday Inn Express in Greater Noida, and Holiday Inn Express hotels, typically you will see room revenue being 85%, 90% of total revenue. So combination of two upscale hotels, ballrooms being in renovation, and then incremental revenue coming from a portfolio which has much higher room to total revenue ratio, that has led to that 71 becoming 79.
But in future, as those ballrooms become fully operational, as Trinity Hotel ramps up, which has good food and beverage, we actually expect to maintain close to 70%, if not better. When I say better means more coming from food and beverage room to total revenue ratio.
Smith Gala
Okay, thank you. That was it from my side.
operator
Thank you. Due to time constraints, that was the last question. I now hand the conference over to Mr. Ashish Jakanwal for his closing comments. Over to you, sir.
Ashish Jakhanwala
Thank you everyone for your time. We did enjoy the interaction today. I just want to reiterate that we remain fairly confident of how this year and the future of Sany is shaping up. I know there’s a lot of distraction about the month of May, but whether it was April, whether it was June, or if it is subsequent period after June, we are continuing to see a very comforting growth. Two, we are very, very happy about the ability to deliver on asset recycling. That’s an activity where we largely rely on a counterparty. And we’ve been able to execute that in time and at price that we expect it to.
So the balance sheet that now we have created for ourselves, what used to be considered a weakness for Sami, two years back, we had a promise that we’ll convert that to be our biggest strength. I think we are well on our way to deliver that. And my belief is that that strong balance sheet and our discipline will create the future value for Sami. So thank you. Thank you very much for your support. We look forward to continuing to interact with you and talk to you at the end of quarter two, if not earlier. Thank you so much.
operator
Thank you, members of the management, on behalf of Sami Hotels Ltd. That concludes this conference. Thank you for joining us. And you may now disconnect your lines.