Over the next five years, Apeejay Surrendra Park Hotels is planning to double its key count to over 5,400 keys. The company has set a target of opening 500 keys every year as part of its asset-light portfolio, Vijay Dewan, managing director at the company, said during its earnings call on Wednesday. According to Dewan the hotel group would also ramp up its owned properties business.
Among its immediate pipeline, the company is planning 880 keys across Pune, Kolkata, Visakhapatnam, Navi Mumbai, and Jaipur. As of March 31 this year, Apeejay had 35 hotels in its portfolio with a total of 2,394 keys.
It has also recently signed an agreement to acquire 60 service apartments under Zillion Hotels & Resorts at Juhu in Mumbai at INR 2.1 billion ($24.5 million) for 90% of the stake. Apeejay is planning to convert these 60 service apartments into an 80-room hotel with a rooftop bar, Dewan added.
This would mark the hotel chain’s entry into the Mumbai market. “Mumbai has been the missing link in our growth plan. It has always been our objective to be present in all the metro cities of the country,” he said.
The Growth Drivers
According to Dewan, the hospitality sector in India is “entering a long-term super cycle.” He said that segments such as weddings, spiritual tourism, MICE, and wildlife tourism will be important in the expansion of the hotel sector.
During the last financial year, the company also entered the heritage luxury segment with two properties: The Lotus Palace Chettinad and Ran Baas The Palace in Patiala.
This, according Dewan, has also led to an increase in the company’s average room rates (ARR). While The Lotus Palace recorded an ARR of INR 14,699 ($172) for the 2024-25 fiscal year, in the January to March quarter, Ran Bass had an ARR of INR 24,000 ($281).
“Both the palace hotels as they stabilize in this year will lead to higher ARR at the company level,” Dewan added.
Two of Apeejay’s owned hotels set to open this year – Malabar hotel in Fort Kochi and Purity hotel in Vembanad Lake – are also high-ARR projects, he said.
According to Dewan, leisure business has a very high potential in the country. “Leisure business has a higher demand-supply mismatch at the moment in India over the next 5 years. If we were to look at the overall demand-supply mismatch in the country, demand is expected to grow at 10.6%, and supply is expected to grow at about 8%. But leisure destinations have a higher demand-supply mismatch,” he said.
Focus on Smaller Cities, Multiple Brands
Tier-2 and 3 markets are also key to the company’s expansion. “The hospitality business in India is strongly emerging in Tier-2 and 3 towns, so most of our asset-light expansion is taking place in these cities,” Dewan said.
He added that the company has two brands for growth in these regions – Zone by the Park and Zone Connect by the Park. “The Zone brand is a strong social catalyst brand, which is made for young contemporary India who want to stay in boutique hotels at an affordable price.”
However, the company will be looking for opportunities to invest in these cities.
For Apeejay, the overall strategy is to have hotels across not only business destinations but build a pan-India presence, Dewan said. “We are a leading player in the business segment at the moment, but we also want to become strong and differentiated players in the leisure segment as we move forward.”
A Glimpse at Financials
- Revenue: In 2024-25, the company’s revenue increased 9% year-on-year to INR 6.3 billion ($73.8 million). For the fourth quarter, the revenue increased 16% to stand at INR 1.77 billion ($20.7 million).
- EBITDA: Apeejay’s EBITDA (earnings before interest, taxes, depreciation and amortization) for the year was INR 2 billion ($24 million), an increase of 6% as compared to last year. For the quarter, this figure was up by 21% year-on-year to stand at INR 610 million ($7.14 million).
- Profit After Tax: The company also reported a 22% surge in profit after tax for the last financial year at INR 840 million ($9.8 million). This surge was double in the last quarter – a 44% year-on-year increase as profit after tax stood at INR 270 million ($3.16 million).
Apeejay Surrendra Park Hotels Chairperson and Executive Director at Skift India Forum
Apeejay Surrendra Park Hotels Chairperson and Executive Director Priya Paul spoke at Skift India Forum in March 2025. Watch the full conversation, above.
