Q4 19/20

Jun 11, 2020

Good day, and welcome to the Indian Hotels Company Limited Q4 and FY 'twenty earnings call being hosted by Mr. Puneet Chattwal, Managing Director and CEO, Hyatt CL and Mr. Giri Despandevi, EVP and CFO, IHCL. As a reminder, all participants' lines will be in a listen only mode, and there'll be an opportunity for you to ask questions after the presentation concludes. Please note that this conference is being recorded. At this time, I would like to turn the conference over to Mr. Puneet Sattwal. Please go ahead, sir. Good afternoon, everyone. I'm here, as always, with my colleague, Giridhar Sanjeevi, to walk you through the key highlights of the clear 1920 as well as 1920. When we look back, although it did not happen in q four, but I think we cannot ignore the fact that brand finance recognized Taj as the strongest brand of the nation in all category. And together with Tata brand retaining as the most valued brand category, I think this is a very good space to be in for a brand from a hotel industry, which has been severely affected due to the pandemic. But, also, it makes us feel very, very proud that our Taj has made it as the nation's strongest brand. When we then move to a kind of rewind of the year gone by, you will see that some of the key milestones achieved were we reached the portfolio size of 200 hotels, of which 158 were operational till we started having the lockdown. 50 new hotels were signed in the last two years. And in the last year alone, we signed 29 more, totaling almost 3,000 rooms. We opened 17 new hotels in the last two years, and last year, we fulfilled the promise of opening 12 properties, one property a month. And the size of management contract portfolio grew from 32% to 42% over over the period of two and a half years. The number of rooms increased from 18,000 to 25,000, while the 18,000 is that when we announced our journey of aspiration 2022, and the number of hotels increased from 160 to 200 in this period. Moving forward on the highlights of restructuring our portfolio, as I already mentioned, we delivered 12 openings. We had a consolidated presence in Goa, which is a key market for us by the addition of Siddhartha Goa last year as well as Taj Hotel and Convention Center. Unfortunately, we opened for almost less than a month. But together, it gave us 500 additional rooms in one of our key profitable market. We added another palace after many years, the Taj Pate Pocache Palace, making us formidable force in the city of Udaipur together with the Taj Harahgarli. So we have three properties, one for mice, and now with as mice in a palace environment together with the romantic lake palace. Very important, we repositioned the ginger brand as most of you would know, and Ginger reached a key milestone of 50 operational hotels. And as I've consistently said, this is a brand to watch. Unfortunately, like any other brand, any other hotel business, this also got hit in March very negatively because of the COVID. Otherwise, we had much more better news in store for Ginger. We signed 20 new hotels on and you will see that in that 13 were Ginger branded properties. Actually, if you look at a single brand in India last year, ginger had the highest share of signings of new contracts to its system. Then improving on that, we consolidated Indian hotel's presence in the Northeast. We always say Northeast is there where Africa was fifteen, twenty years ago. It's a market ready to boom in in the next few years. And now after a very good success of Guwahati where we are present and also with the Ginger in Alcala, we added hotels in Shillong, Gangkok, and Sawang in Arunachal Pradesh. We also got the information of disapproval, the IOD as they call it, which means basically a kind of an approval to start building a 371 key flagship Ginger in Santa Cruz on the property that we own, which was belonging to the old flight kitchen of the FastSat business. We even had a record year for growth both in terms of signing and in terms of opening. As we have always constantly communicated, one of the key values that needs to be unleashed is the values in our brand and also trying to make our brand pure. The result we have already seen for the Taj brand. But, also, the same year, we came up with the rebranding of Taj Sats. We came up with the rebranding of Chambers, Kazana. We've introduced a new brand like Amma, Homestays, and Trails. We introduced a new brand in the salon business called New and Law and several food and beverage brands, including the one in partnership with AB InBev for which we have also got the required permits. So within four weeks, the first group work under the brand that we have jointly developed with AB InBev will be going live in the city of Bangalore at the Taj on the MG Road. So these brands have been drivers of our top line, and lot lot of these brands have been carefully chosen because they are significant margin drivers. These are not brands that have been chosen because they just create the buzz around our mainstream brands like the Taj or Vivanta, but also in themselves, they're brands like re reimagining Chambers. Why? Because Chambers' margin contribution is as high as 80%. Same is the story with some of the micro brewery brand, which I told you. The brewery brand has a very high margin contribution versus any other food and beverage restaurant. And also, our sales interest, we have no investment. These are existing bundles and and guest houses of Tata Coffee or of other individual owner reaching very quickly. I think this year, it will have at least before the December '25 operational armors, and these are all adding value to our portfolio of brands and helping us drive our market share. Moving on, some of the campaigns that also assisted us and you've got to see especially in the month of February and the March was our campaign on touch like always and like never before. It has an offline reach of almost 4,000,000, social media reach of 2,500,000. We used displays and search to get to several millions in terms of our reach, and this brand really helped us in driving our market share. So that's all, you know, these kind of activities resulted in what we're going to show you now is our result for the full year. If you move on to the next slide, which is if you see the revenue came in flat, and this revenue came in flat because by February, the growth had started slowing down. Actually, our memories tend to be short. We tend to blame everything just on COVID because it is such a such a major impact on our business and shutting down our properties. But the slowdown had started a bit earlier, It's reflected in the GDP number for the full year, and that all did not come in in February or March. Growth in the GDP had been constantly slowing down from the q one of last year. So although our revenue growth was flat, our EBITDA still grew by 20%. Our EBITDA margin grew by 400 basis points, and our pad had a growth of 34%, which is when when Gideon takes over from me on the details, when he will take you through, you'll see what kind of an impact we had alone in the month of March and how much it drove us into the negative territory versus where we were almost in year to date December or year to date February. When we look at the details here, you see that especially in the last four years or so, the revenue growth is only around 10%, but our EBITDA growth and EBITDA margin growth is very phenomenal, I think. That is mainly because of the change in our business model that we have been communicating. The revenue growth, if we get rid of properties that we own, that are loss leaders, and reduce the debt with it, the revenue goes down. Then we add to the management fee business. The management fee business is only added as management fees, and once the revenue goes there, So that part of the growth slows down, but what it really helps to to achieve is the margin expansion, which we have done. And and if you look at the last three years, we've consistently grown from 700 of the rows to 1,100 crores in EBITDA from 17% EBITDA margin to almost 24% EBITDA margin from a PBT of 162 to more than doubling it to $3.55 and a profit after tax at a 3.5 times increase from 101 to 354 crores. Moving on, some of the key initiatives that we had announced in aspiration 2022. And this is important because we are exactly today halfway through the aspiration 2022, which was launched middle of Feb in 2018 when we did our Capital Market Day, invited all of you, and announced what we were going to do. And the five key pillars of aspiration 2022 was restructuring growth. We said we will grow by 15 hotels per year. If I look at only last two years, we added 50. So if you look at the restructuring of portfolio owned and managed, we said we wanted to have a fifty fifty balance at the 2022. We have already reached a 42% managed portfolio. When we said we'll reimagine excellence in being the most iconic and most profitable hospitality company, we were awarded the strongest brand across all sectors, and I don't think it can be more iconic than that. And in terms of reengineering profitability, our EBITDA margin expansion, we have given a guidance of 800 basis points, but we achieved 700, of course, with the a little bit help from the change in the accounting standard. But even if we were to discount that, we would still have 350 to 400 basis points growth in EBITDA margin despite COVID impact, which you will see in March. And our ambition and aspiration was to bring down our net debt to EBITDA to to less than two, and we finished the year at 1.69. Moving on, I think we need to now address the COVID challenge. And there is this unprecedented issue has been a challenge for not just India, but globally for the hospitality, tourism, and airline industry. There is an estimated loss of $2,100,000,000,000 in terms of the top line. There are 75,000,000 jobs at risk, and there is a fall in global aviation revenues by 252,000,000,000. And the global economy is expected to contract the minus six. Can we anybody's guess, it could be even minus 10 or or even a number higher than that depending on which economists want not to. When we further move on, based on these numbers to the Indian travel and hospitality sector, the loss is estimated at 10 lakh crores with 38,000,000 jobs addressed and up to 25% impact on international travel. And India's estimated GDP growth is supposed to be contracting to minus 3.2. I was on a webinar yesterday or day before where one of the former economist or adviser to the government actually expected a much larger number. It was more than twice that what is shown here. And every time somebody every week somebody or the other comes up with a new forecast. So I think, definitely, there is going to be a contraction in GDP, which has a very strong correlation with our business. After getting all this information and having had the experience of exactly three months today, you know, the international borders were shut down on the March 11 because all visas for travelers coming was canceled. People of OCI card holders were also stopped as of March 13 and today being the June 10. It's really three months into this. We decided to turn our strategy that said, okay. We have already achieved maybe 70% of our goals of aspiration 2022. This is not the time now for looking only midterm and what we're going to do in 2022 rather to address the issues now. And we came up with what we call a reset 2020. And as of next quarter, we will give you new targets on what we think would be our aspiration going forward just for the sake of clarity. And I would like to repeat that very loud and clear. All our targets will be enhanced. They will not be corrected outward. Rather, they will only be corrected upward because we have a very strong belief as management in the future of our industry, and we don't see this as a permanent problem rather under the under the famous thing that these two shall pass. The question is only then, in three months or six months or nine months. But this too shall pass, and that's why we need to press the button of reset. And our reset response to COVID nineteen is based on revenue growth. We will be announcing seven key revenue initiatives. One was already launched yesterday or or day before in Kannada and Kerala where you would tell the whole thing. It's on a based on a concept of drive stations. It's called the four d experience. That is a dream, drive, discover, and delight. So you dream when you get into your car. You drive. You discover a new destination around your place, three to five hours driving distance, and you delight yourself. So similarly, we have lined up a a number of initiatives, including new lines of revenue. I think it would be prudent to mention in this call that within a week from now, we will also be launching our own home delivery business under a new brand with our own app, which was a long time desire to do something in our business also on the digital side. So on the state of the art app, you'll all get to read about it. The phone has to be patient for a week. So there are several such initiatives that they set as the top seven of ours, which are meant to compensate for the loss in revenue or better set the loss in EBITDA or impact, which is definitely the case for us and for the entire global hotel industry in the q one of this financial year. So on top of that, we are also coming up with strategies for new corporate leisure wedding and buying businesses across different states. We will have new business based on this app will also be taken as shops into hotels, the roommate shops in key city central locations where they have large footphones like at the president and or the ambassador in Delhi, is Bandhara Road, Drosling, you know, all that catchment area. Then as as an example, something which we launched on April 10, hospitality at home initiative has proven to be very successful. This was just delivering hampers or people coming to pick up three different kinds of hampers have given us some kind of incremental revenue, which was not existing before. So some of these initiatives which are already launched and some that will be launched over the next four to six weeks depending on the opening are all ready. We are ready to go with it. And our focus will be definitely on one of the initiatives we launched last year, which is a very big success for us, was driving Chambers membership. Chambers, when in its absolutely new look, feel, and design, is being launched at the month thing in Delhi. Delayed by three, four months for obvious reasons for COVID because the hotel is shut. And, also, it got delayed because of the air pollution issues that we had when Supreme Court made all construction stop for several weeks in in the NCR region. So the chambers will be launched at the month end by September year at the latest, hopefully, by October, which gives us clear six months in the rest of the year. And the same will be the case in London. So the chambers will be entering the London market, and we think this gives a a definite great positioning for a private club brand that only we have, and that would be our competitive advantage going forward. Moving on to the excellence initiatives, I think you all know we have launched the TajNet, the commitment, the strength. These are initiatives built around the new normal as they call it, the health, the safety standards, the standards of, you know, food production, the food delivery, the food service, but also excellence in what we do, excellence in our value. You know? Our values stem out of the three letters, Taj, which is trust, awareness, and joy. And the trust of the community is with us because we have supplied 2,000,000 meals in this time through the assistance of large public service staff, to the doctors, to the medical fraternity, to the migrant workers, and also hosted so many medical room nights. You know, approximately 25,000 plus room nights have been hosted by us and also subsidized for large public service and surcharge. So I think this is something extraordinary. And now I come to one which you all like to hear the most. Of course, I think revenue is very important, but it's very important is our initiative from spend optimization. And when I talk about spend optimization, we need to make sure that that 50% operations have been, you know, shut down. Mostly operations are shut down, and there is a staggered opening. So 50% of our hotels across the portfolio were closed. All were used only as active quarantine centers as of as of May. And post relaxation of lockdown, we have put a plan for the staggered opening in place. The fact is considered for the staggered opening is obviously different in every state. It depends on the rules and regulations of the state and also the country because we also have hotels outside of India. The second is obviously the profitability of the hotels in terms of steady state EBITDA margins. And the third, because if you have multiple hotels in the same city, you have to look at the chance of which one drive the maximum margins or which one helps you to keep the cost that's under control. The third is a threshold occupancy level for the hotels to be profitable or stabilized or to breakeven, and ability to synergize within a city and maximize business potential, as well as in these difficult times maintaining owner relations and having understanding of the limitations of the owner on cash flows as every owner is not in the same financial position. Moving on further from this two, it comes to the spend optimization initiatives. I think we go through a historical phase in our company where we have embarked already since a year and a half or so, which most of the analysts have been spoken to and told and the investors also. They've been working on the organizational and payroll optimization since the year and a half, and now that has accelerated. And if you look at our corporate overhead, as a percentage of revenue, it has continuously declined despite the normal inflationary increases in payroll expenses. And I think we will now see a more significant change in the corporate overhead, but also in the operations of the hotel. As we have so many openings of hotels, we have the possibility to redeploy people. I always say, yes. Cost cut also comes on top if if people were to be taking pay cuts, but, ideally, you redeploy because all those measures are temporary. Whereas if you effectively reset the cost base, reset the manning base, reset the number of executive base, reset the base on the branding and the portfolio that you have, that has a longer term impact. So when the business comes back, you'll reset your cost base for a much healthier future tomorrow. Similarly, on heat light and power, I think we have been able to drive these costs significantly lower. So in some places to one third of the level it was there before. This is also an ongoing project, and it has accelerated now ongoing by because we picked up 19 orders together with three months to do a kind of a study. And and now why it has accelerated in certain states have been forthcoming. For example, Maharashtra has given both on the fixed and the variable cost based on the consumption, a reduction to the discounts and to the to the to the energy providers, which has been further given to us. Similarly, on unnecessary repairs and maintenance expenses, going forward also on stores and supplies, nice to have versus what is necessary to have in the period of lockdown. Advertisement and promotional expenses, cleverly using digitization going forward, which is much cheaper. And as I already alluded to, administration expense and having such at all consulting level, having such with all other people who work with us. With this spend optimization comes the next e, which we have, the effective asset management initiative. I think this is also something which is a very lasting impact. As you have all known, we have been monetizing noncore assets, like sale of apartment, sale of some kind of villa, which we have never used for last twenty five years, let's say, in Pune. You know, we have some kind of farmland, etcetera. So those initiatives will keep going on also this year. Also, in our subject like OHL, we had the sale of hotels in Trivandrum and Wi Fi, and we used those proceeds of the sale to bring down the deck. We'll continue to explore those opportunities at ISCL level also. So this year, we plan to definitely sell one or the other assets and take it on a managed back or on a leaseback basis and also minimization of these costs. So wherever possible, we have entered into dialogue with the landlord and started getting reduction in leases. And some of those places with leases have been reduced and have had a significant impact. And then other places, we have to carefully check where we have the right to do so based on the contract we have, if there is a post merger clause or not. If there's a post merger clause that can be booked, yes, we have the possibility to do so. Following on with the asset management initiative, we also have what I already alluded to a part of our being thrift. The the p in the reset is the thrift and financial students initiatives, which is obviously, I said, reduction in corporate overhead, which has gone down by almost 10% in the last two years despite the increase in two years of almost 12 to 13% in the staff cost. We have deferred a lot of renovations. We have been spending almost 400 crores on an average per annum on on renovations and upgrading our portfolio, and we were successful in upgrading a lot of our Vivanta properties through charge and a lot of gateway properties to the Vivanta level. And also in terms of raising credit line, which is very important to have the liquidity as none of us know how long this crisis would last. We'd have no intention of increasing debt and living out of debt, but we definitely need to have the liquidity. And all the one offs that we have can help us to keep reducing the debt as we have done before. I always give this example. We tend to forget. If we just look at the the renovation of one thing and we add to it the prepaid lease that we have made there or the deposit that we had to give for the renewal of Lake Parrott. Or, you know, when we add up all these things, they have been done from the cash flow generated from the operation. We did not raise any debt, and our EBITDA kept rising, and that's how our net debt to EBITDA went down to 1.69. Moving on from this slide, I think the best is I hand over now to my colleague, Gerrit Hafanjeevi, to take you through the details of all our financial performance of q four and the full year 1920. Thank you. Thank you, Puneet. I think I think I move on to the financial numbers. I think if you look at the q four, I think we we you saw the numbers that we declared. For q four, we had a top line of thousand 100 crores, and then we had a profit after tax of 74 crores. I think what was important to highlight was the January, February, and the March impact of COVID. So if you see what had happened up to the February, we were pretty much on kind of growing. Of course, this year, there were impacts in terms of GDP growth slowing down and a whole bunch of other factors. But nevertheless, until the February, we did grow revenue by 2%. Operating expenses degrew by minus 4%, which means we had a positive EBITDA leverage, which resulted in margin expansion. Finance costs were broadly declined in terms of what we saw, and exceptional items top of 3 crores represented some of the monetizations that we did in the month of March, which is all about the partner of the last plan, which gave us the 145 crores, do you say, profit after tax. March, of course, we saw the impact of COVID coming in after around March 22, which did result in our revenues dropping by 48% as compared to the previous year. Operating expenses reacted less because we didn't have too much time in terms of reacting in terms of operating expenses, which gave us the laws of business, of And rest of the lines were kind of consistent to that, and we had a profit after tax of 70. So what this slide demonstrates is that till the February, we were broadly going in line with what we had planned, and March was the time when there was an impact. Go to the next slide. In terms of exceptional items, I think what is worth is that beyond the sale of property, the Pagovaila property, and that gain on sale of property of $6 for the sale of ginger and. We also sold apartments. We also saw the deposition of the dollar, which came up in the last quarter, which resulted in a 24 impact in terms of the end of mark to market. So this is just a slide on the exceptional items for q four. If you look at the full year, basically, this is looking at why it is December and q four. Effectively, as as we I would like to think the summary slide. The top line was flat at 4,000. The income margin expansion after it, because operating expenses were down by 95%. And then interest cost broadly stayed in line. Exception items constituted the sale of sale of noncore assets resulting in a profit after tax of 354 crores while this is post India. Even on a pre India's business, the fact was 393 crores, which was which represented on a post India's basis, 406% margin expansion. And even on a premium based basis, it represented plus 2.9%, which is what we'd always communicated in terms of the secular growth in margins. Moving on moving on, I think in terms of consolidated exceptional items, I think pretty much it's the same picture as we saw in the quarter. And I think you can see the full impact of the gain of sale of class of 87 crores during the full year. Move on, please. And I think what is very important to highlight is that ever since 02/1516 and and then beyond, we have seen the very steady improvement. And what is interesting to see is that while the top line moved from 4,150 crores to 4,596 crores, which is an improvement of approximately under 15%, I think the the EBITDAs grew from 652 crores to 1,100 crores, and the profit after tax went up from a loss of minus $2.30 crores to a profit after tax of 354 crores. So really speaking, it has been a very concerted effort in terms of working on the revenue results, the cost figures in terms of achieving these results completely. If I look at the stand alone numbers, stand alone numbers once again reflect the similar pattern, where, again, the distribution will happen after the February and March separately for q four, while we reported total revenues of 754 crores. We did save in operating costs of 8% resulting in some leverage impact of the February. There was a positive release of 10% in terms of EBITDA. Margin expansion clearly occurred up to the February, and profit after tax up to the February was about 145 crores. March clearly was a loss of 53 crores impacted by the drop in top line of 47%. Moving on. The stand alone exceptional items, I think only item to note is that, like, as always, whatever is the cash loss that we are in first, we sort of provide for that in the stand alone to ensure that the investment block does not get later. So we had about 40 crores there. But other than that, it reflected this sale of property including flats and the the rate and gain on derivative contracts. Moving next, please. So on a full year basis, the standalone numbers were also flat to 2,878 crores. EBITDA went up by 9%. EBITDA margins went up 2.56% on a posting days basis, and PAC went up to a historical higher for a month. In fact, on a three days basis, the pack was 418 crores. And even on a three days basis, the margin expansion was 208 basis points, which was completely in line with what we had talked about secular expansion. Go to the next. On a full year basis, this does reflect the full year numbers where the revenues are flat, operating EBITDA margins went up, finance costs were broadly in line, Exception items reflected the sale of property, ForEx losses, and the provision for PS, and profit after taxes for that was 401 crores. You will see on this slide the exception items. The only point I want to highlight is that on peers, they actually improved. The minus 32 crores that you see in 2018 was after the Boston income of 46 crores. So therefore, in the prior year, the loss on peer was 78 crores, which came down to 69 crores in terms of cash losses. So there was a concerted improvement on the PR position. In fact, on the international properties, which is UK and US put together, our cash profit improved by £22,000,000. It's $2,000,000 or so. So, hence, I think, overall, our international portfolio did better as as we have kind of always highlighted. Next, please. I think I'm spending a minute. I want to spend a minute on some of these standard on revenue metrics, actually. Once again, if you look at q four, I think as we've always said in the current in the last connection here, the RevPAR increase was influenced a lot by the occupancy and less for the ARR. So up to Jan, February for the q four, the occupancy grew by about 1% or so. The ARR, they grew by 1.5%, giving us almost flat RevPAR actually. March, obviously, was a different story. Occupancy dropped. We protected the ARR, and that resulted in a RevPAR drop, giving us the overall three for position. And I think the strategy here has been just reversed. If you see, I we have to February. Occupancy the part was driven by occupancy while rates went down. The moment the the crisis hit us, we were able to sort of protect the errors as much as we could actually. In terms of room revenue, the room revenue growth was 3%. F and B revenue decreased by 4% after February, and March, of course, was a different story. More on. For the full year metrics, once again, we see that after February, the occupancy grew by 2.1%. ARR was negative minus 2.3%, giving us just about a percent of of RevPAR. March, of course, as I said, that the occupant user impacted, giving us the full room metrics. Room revenue grew by 3% three and a half percent up to February, and SMB revenue grew by 1%, which was very impacted by March. More on. In terms of let's see if we discussed in the Capital Market Day. I think we continue to make it first in terms of the different cost lines, whether it is raw material line, fuel and power. Payroll cost, of course, changes because when the top line drops, you get an increase in payroll cost. Other expenditures also went down. But now as we go into reset, there'll be much more work here, which will happen as Puneet is highlighting in terms of changing operating losses and driving the even harder, actually. Next slide, please. Monetizations, this is just this this continues to be part of strategy, which is the Monon code monetizations, whether it is land, residential apartments, simplification. I think all of those will continue. Last year, as you know, we totally monetized the 02/2011 course. On the balance sheet and liquidity update, I think what is good is that, like, I put up a slide in terms of the pre and the performance over the last five years. I think the balance sheet performance has also been significantly kind of under focus, where the net debt to EBITDA went down from 6.47 to 1.69, and the net debt to equity went down from 1.27 to point three six. So I think this is a key measure that we look at very closely, and we will continue doing selection. Go to the next. In terms of the net debt, the net debt at a consolidated level actually reduced, and the net debt at a standalone level also reduced. You will notice that the liquidity went up here in both in standalone and consolidated, but that was because of the strategy in terms of ramping up liquidity as we saw the impact of COVID. The weighted average cost of debt all remained under control, and we spoke about the net debt to equity and net debt to EBITDA. In terms of funding, I think we have been I think the credibility of of Indian hotel staff has been very significant. So in the month of March, we drew down the court of Mahindra and the active bank loan. And I think what is incredible to see is that we were able to take advantage of the TLTRO operation that the RBI announced in the long term repo operation. And in and at a time when people talk about hospitality industry being impacted, we were able to draw unsecured credit lines about 450, which just speaks to volumes in terms of the credibility that we enjoy. And the important thing to note is that we have not resorted to any short term funding. Our the unsecured loans are a three year do a three year maturity. And in terms of the other loans, the door to door maturity is fixed. Our credit rating agencies have all been kind of reassured, and borrowing borrowings are also common in place. So we continue to kind of sort of make sure that we deal with the financial markets as far as liquidity is concerned at sensible rate. And that's the right thing to do because we need to maintain liquidity. And and we're also keeping a close watch on the net debt. And in fact, one of the things that we said, the monetization would be an important lever that we will we want to use this year. And any monetization we do, we would like to repay some debt so that while we sort of ramp up liquidity to deal with the crisis, we will also be able to keep the balance sheet held simultaneously. So that's really going to be our approach, actually. With this, I kind of come to the end of the presentation. I'm happy to move into question and answer. Thank you. Sure. Thank you, sir. Participants, if you would like to ask a question, please signal by pressing star one on your telephone keypad. If you are using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, press star one to ask a question. We'll pass for just a moment to allow everyone an opportunity to signal for questions. I will also request everyone to state your name and the company they belong to before asking a question. We will now take our first question. Yeah. Hi, sir. Sumant here from Motiva as well. So my quest my question is, post COVID, what are the changes in the domestic market and international market in terms of business dynamic? And what are the steps we have taken for the domestic and international market in cost side? Shall I go, Gary, on this? Or Yes. Yes. Having a good question. Sir, Suman, hope you are well and staying safe. The first is on the international, on the cost side. On the international, on the cost side, you know, the San Francisco property, the New York property, and the London property are the ones which we own. The other contracts which we have are either management contracts or are in a joint venture. The good news in these very bad times is that in The US and in The UK, the government is bailing out the operators very heavily on the cost side. So they are putting in the money. For example, in The UK, up to 80% of your staff cost with a cap of £2,500 on a monthly basis is being subsidized for a period of six months. So so that is one of the examples. Second example, for example, in UK is the property cost has been waived off for the full financial year. That alone, just the property cost in The UK for us with the Buckingham Gate and Saint James Court is almost £2,500,000. So there are things like this that are different market to market. We can do detail on an offline thing if you wanted a detail on a market by market basis. We're like Dubai. We have management contracts. The new hotel which had just opened, we shut it down. It will reopen in September, October. So we'll lose the management fee for the period that it is shut. But we have to, as I said, have understanding for the owners, their cash flows also. We've kept only one hotel open, which has been there and is very well established in the market in business days. So that one is open. Maldives, we are preparing for a reopening. And Sri Lanka, we never shut down the properties, so they're all operating at a lower level. When it comes to on the staffing part of it, of course, there is a serious reduction on the contractual labor, which is a labor of the contractor because if you're not operating at 80% occupancy, you also need 60% less people to do the same work. So there is a lot of that happening both on the domestic front, but also on the international front, which I would say is on the Indian Subcontinent, which is in or around India. When it comes to other costs, I think mister Sandeep showed you how over the years, not just because of pre COVID or post COVID, we have been taking measures to harmonize our cost to become more efficient and to increase our margin. That journey is on and will continue, but, actually, in this COVID period, gets even accelerated. On the revenue initiative side, on the domestic front, I think in any country today, the initial business will come back based on the domestic business. And the revenue initiatives that you will hear that we are announcing, the seven initiatives of which two I already told you, they are all based on the domestic market growth. As we don't know whether international travel will start in September or October, and that it will come back to its normal level maybe up to January. So the reliance has to be on the domestic market, but it is also an opportunity. So why is it an opportunity? It is an opportunity for 26,000,000 people, but traveling out of India. Some of those people are not able to travel. And even if 10,000,000 of them are captive for hotel business, some point needs to get out both on business and on leisure, at least within the country, and take their families also out on a holiday. And that's why this drivecation could be an answer in the short term versus flying or taking train to a destination. Yeah. So talking about the cost with license side, can you elaborate more on how fixed cost overall percentage term or variable cost percentage term reduced during this pandemic? Can I can I answer that, man? Yeah. Yeah. Yeah. Think, as I said, you know, I think we should look at cost optimization on an overall basis because it is not just one line across the loan. But I can tell you that if I look forward to just two and as we have kind of looking at the cost reduction on the domestic side, our cost reduction, we expect it to be upwards of 40. And on the international side, we expect it to be upwards of 65% action. So that's the overall cost reduction, Patrick, in q one. And we are yet, you know, on some access to the cost. We are kind of deliberating in terms of how to do it the right way. But even without that, I would say that the kind of production. So we will kind of talk about it more, but I would say that this is what we hope to achieve immediately. So is that that, 406060%, 65 you are talking about, this is on overall basis or, fixed processes? Overall. Right. Overall. Yeah. That's that's the Okay. And when the international market Did you find that correct? What this crisis has shown to us is a lot of fixed cost in a crisis can also become a variable cost. Right. Everything doesn't stay fixed. And any expectation of opening your and US hotel? Yeah. We think a slow opening in London is anybody's guess, either July or August. Okay. Yeah. And US? US, we don't know because at the moment, what is happening in US is a bit risky, so we have to take one step at a time. I don't want to give any kind of a misguiding answer. You know, this all this unrest in The US, and especially in Midwest is very strong, but you never know when it becomes out of control for New York. But if it stabilizes, yes, we can open in New York. Okay. And Jan has not San will be later. San Francisco will not be now. In that state, it itself, they also have this federal system. Every state decides. So California has a little bit more strict. So that will take a few more months to open. Okay. So Jan Feb was watch out for 10 gs. Right? Or Jan was okay. And also about The US business, how was the performance in Jan Feb or March? Really? I think I think I don't have the exact numbers for Jan and Feb for US, but I think my sense is that the can can I can I use it offline? I don't have any access We can do that. Kiri, I will answer. The Jan, Feb for US was quite good, and so was it for UK also. It all started slowing down in The US and UK ten days before in India. It started March 1 was when we started seeing negative growth. I remember that very well because I was personally in London on those days, and we had a meeting where we discussed that. The pickup became negative. Okay. Thank you so much, sir. Thank you, sir. We now take our next question. Hi, sir. This is from JPMorgan. Hope everyone is doing well. I just had a question on the balance sheet. So if given the recent capital basis, what would be your debt level And would you say that would be the peak debt for the year? I think I think the net debt level, we are still okay. I think the net debt level from $18.57 crores or so has probably gone to 3,000 crores. I don't think the net debt has gone beyond this. Now I think in terms of target for the year, it's hard to stay for target at this point of time. I think a lot depends on how the recovery process starts. And as I mentioned, this time, I think monetization continues to be a major plan for '41 plus here. And on the assumption that we are able to successfully monetize a meaningful sum, we will use it to manage the debt limit. Got it. Sir, sir, could you if you I don't know whether it's too premature, but could you outline what would be your fixed expenses on a monthly or quarterly basis after the cost initiatives that have been taken? I think in q one itself, I would say that the basis, whatever little bit that I think I think the fixed cost would have gone down by at least around 35 to 40 crores at a minimum, actually. I think that is what I would say at this point of time. And I think this is not because yes. But as I said, this is what is estimated at this point of time on a monthly basis. And and we have not yet touched the number of other initiatives. So those will kind of we will see that happening since we started in the year. Right. And, sir, last question on the payment for land, which you had to do, I think, some portion this year. Would you be going forward with that? Yes. I think the three of settlement remain of this strategy. I think it is very important for us to sort of take control of that. And I think what so far we have done is that I mean, we we have not yet kind of completed it, but we do hope to complete it actually. Absolutely. And I think in case that payment is started by the 2021. Got it. Thank you so much. Thank you. We take a next question. Participant, your line is open. Please go ahead with your question. You're on mute. Please do press down mute button. As there's no response, move to the next question. Hello? Yes. Please go ahead, sir. Yes. Hi. I'm Kostya Gupta from Vire Enterprises. So just could you give us some more color on your domestic and international subsidies? How have they performed in FY 'twenty over FY 'nineteen financially Could you, like, go into some major subsidies internationally and domestically in 'sixteen that to us? Because I feel like in FY 'twenty, your subsidy operational performance was better than f y nineteen. Right? There was a big jump, at least in the nine months of f y twenty. So could you explain where this is coming from? No. I think I think if I look at the what are the major the the biggest subject is PM hotel. The PM hotel continue to do well. Of course, I think the domestic businesses were impacted in the month of March. So I would say that PM and you will see that in the published number. I think for the full year number, PM will probably do near 400 crores in terms of top line, which was minus 7% in terms of revenue. EBITDA was up to 2 crores. That is EBITDA, that is minus 30%, but that is because in PM, we also get a certain dividend on that company. So I think you should factor in for that. And overall, that was approximately 11 crores of growth. So but on a like for like basis, without the extraordinary dividend that PM received, I think, was broadly fine actually. In terms of Roots, Roots did a top line of 215 crores, which was a 3% up. I think in terms of EBITDA, it was impulsive directly. 15 crores was EBITDA. That was impacted because of the impact of March, and we were not able to actually all the monetization in the month of March. So that was negative minus nine, which was still an improvement from the previous year's fact of minus 15. So that is a sort of a good perspective, but second important that's subjectly. On the international side, very clearly, St. James Court and US business, there was an overall cash improvement of about 2,000,002 million dollars or so. So therefore, the performance is continue to focus. You UK, of course, did very well in terms of the improvement in performance. And as far as US is concerned, as I pointed out in my presentation, the losses came down. So therefore, a cash profit based cash impact basis, overall, there is a 2,000,000 improvement actually. So I would say that I would say that the international entity did well, and the domestic entities performed in line with the Indian hotel standard or in terms of the domestic market. Okay. Great. When you speak about simplifying your corporate structure and sale of noncore assets, Just wanted to understand, I mean, what are you guys thinking is the next steps in simplifying your corporate structure? And are you focusing on simplifying the international portion first? What are the difficulties in doing this that you're facing? And also, when it comes to sale of noncore assets, I mean, what are the I'm sure there are a lot of assets which you plan to sell, but there are probably some difficulty You know, if you're I mean, it's not that easy to sell a hotel assets. So could you just speak a little bit about all that? Yeah. No. I think our simplification strategy has been fairly consistent. I think we have far too many legal entities. I think and therefore, we need to sort of start touch, what do you say, simplifying the complex legal entity structure. What we have been able to achieve so far are some of the simpler ones. Like, last year, we sort of simplified the Taj Madras flight kitchen, which was standing separately away from Taj Taj Madras Madras kind of ensured that Taj takes over. There was another company called Taj Enterprises where which had again significant other share of the big big kind of once again changed it. So therefore, in terms of shareholding patterns, we have historically there have been multiple shareholders in some of these companies. We have simplified that. So that's number one. As far as the the bigger bigger entity the concern. You know, do we need all these different digital entities? I think the reality is that as far as PM and Benares and other hotels are concerned, some of these are listed as you can imagine, like Benares. And in companies like PM, we have partners who are significant shareholders. You know, my ideal solution is that can we just merge all of these things into Internet health and give them shares in business. That's probably the best solution. But with partners there, it is not the simplest solution. So I do believe that the present crisis is putting different stresses on different companies, and maybe that creates an opportunity for some of these mergers that we talk about. I think that is one part of it. On the international side, about four years ago, we have clearly simplified in terms of making sure that all international companies come under our best of the deal, which is 05/2004 actually. I think no immediate plans in terms of restructuring we have planned, but I think let's see how that goes forward actually. Simplification continues to be an important part of our strategy. As far as the monetization is concerned, I think what we what we have tried to do is that number one has been clearly non core assets like residential apartments where our employees used to stay. That is where we had maximum success. We have sold more than you know, I think this year we sold we made a profit of some 87 crores, some 100 crores of sales happen. Next, we looked at land which we have never used, like, whether it is the the Kaduna plant in Pune or even or even development of the Ginger Building in in, what do you say, hotel that we are talking about in Bombay. That's also a form of making good use of land assets. The third, of course, is the sale of hotel assets. So far, we only done which is part of orient hotel, which is in the and the the Vandrum hotel, which was used to reduce debt there. Fourth is that other hotels in the Indian hotel system that we can dispose of? Of course, yes. And we do also have the platform with GIC where we are trying to see if we can monetize some assets through the platform. So that work continues. So, clearly, you're right that monetization continues as a key objective. And, of course, we are resentful because we are not trying to undersell any of this stuff. And and I think that is from a balance sheet strategy, if you can ask, you know, how do you manage? What are your target dates and things like that? And monetization will be an important part of strategy to sort of manage the balance sheet. We are certainly not intending to undersell the asset section. So therefore, we will continue to pursue it with all the discipline that that goes with it. Yeah. Okay. And thanks for that. Thanks for explaining that. Just what's happening with the CRO hotel? Could you please so once you complete that process of buying out the partner who holds that 15% remaining portion, Environmental clearance wise, there was some hold on that land. Right? So what's next after that? Yeah. So I think the absolute direct thing we wanted to take charge of our system, and therefore, we wanted to we want to buy out a part more than taking a percent control of that stuff. And and cut out some of the litigations that have been associated with it. And clearly speaking, there are three levels of approvals that we are pursuing. One is we have that. The second is the, you know, the CLRZ. And third is that the PRM that you're trying to eliminate. Our sense is that I think there is a much greater understanding that the government in terms of supporting it. It'd be, I think so therefore, we believe that over the next couple of years, we should be able to make significant headway. And I think we've also discussed the part that we are trying to create an alternate access from under the value ceiling access direct to Targetland. That also in principle, the government is supportive. So my sense is for the next couple of years, we do hope to sort of sort of make significant progress on these approvals. We will keep you posted. It's been a long and hard journey on this, actually. And I don't know. Is there anything else you want to add to me from this? No. Just that we are very close to finding a solution, but the transaction value is so high that we have to be prudent in doing the right thing. Yeah. And, you know, we have a lot of history on this one. So you have to settle, like, one step and the next step and the next step and the next step, and we're almost now coming to the end of it in terms of solving it. The 15% you mentioned and acquiring that, then we have to go and get the permissions to build. And I think it's becoming an opportune time. The timing works in now in our favor, which worked against us in maybe the last ten, fifteen years. Great. Just if you don't mind, last question. So just if you've done some survey or if you have this data in your domestic hotels, so if you take all your hotels in India, would you know on average how much percentage of that of your client base is international? So how many people are traveling from international destination to come and stay in your domestic hotel? Sure. Sure. We can. Yeah. It's a good question, actually. We don't mind at all. It's a it's a it's a question which has several answers. So let me try initialize, go and try and attempt it? Yes. Yes. Yes. So we have different brands in different market positioning. If we look at a ginger branding, almost 99% of the business is domestic. Then we come to Vivanta level of branding. I would say almost 80 to 85% of the people visiting those properties is domestic. When we get to the selections, I think it is a mixed bag, and it's a very small portfolio, only 12 to 15 hotels. So so it is not so impactful. When it comes to Taj, the numbers remain the same. And and they just the international improves from 20 to 25, and then you are on the domestic front at 75. When it comes to the palaces that we have, they are the international and the tourism driven business versus only, you know, business and mice and weddings becomes almost 50%. But the palaces are not that large in size. So I think international business is very important for us because it is high paying. That's how it gets to those percentages, but it's not the biggest volume driver for us. The volume drivers still remains in India, your domestic mice business, your domestic wedding business, the domestic business, and and the leisure segments, which drive occupancies and rates. And that is why the growth of domestic business or the rebound of domestic for India is far more important versus if India was, let's say, a country like Greece or South Of Spain or South Of Italy, etcetera. Okay. Great. Thank you much. Yes. Thank you so much for answering. Thank sir. We now take our next question. Hello? Yes, sir. Please go ahead. Yeah. Hi. This is Amandeep Singh from Ambrit Capital. Thanks for the opportunity. So, sir, firstly, can you help us understand your industry outlook across domestic, international, business, and leisure, including mine? And how would be the recovery across these segments? I think we did answer this question in various forms. We think domestic is the one which is going to come back faster. International will only come back through the international travel or the repatriation flights, bringing back nonresident Indians back to India. Now if they are holding another passport or another card, then they are also counted as international when they count the traffic coming in. So so but in the short term, in the next three to four months, we don't see international travel coming back that strongly. Once we do our q one call, I think the visibility will be higher to give that answer. The domestic business, wherever the markets are opening up, we are seeing that business is reviving faster than we thought six weeks ago. Including in all things like, you know, if if the hotels were given the permission to sell or get rid of the liquor stock because, you know, there is an expiry date for beer, etcetera. So it went faster than anybody would have thought is possible. At the lower margin because you can only sell it at a a MRP. So but the sales actually started happening. So this is the if you we started this hospitality at home, you know, selling hampers, then it's it it worked more than we thought it would work. So there are domestic this is the thing that domestic is stronger, and domestic is far more important. And those potential travelers, as I said, who are not able to travel abroad are also stuck here. I'm sure they will need to get out whether they go to Goa or Kerala or Bangalore or Rajasthan, you know, that that is the one which will come back faster. Also, because some countries might put in like, we have different states saying different things. Some countries might put in protocol for quarantine that people might be discouraged to travel to international destination. Sure, sir. That's helpful. As a follow-up to this, how do you expect ARRs to pan out given the higher share of quarantine travelers currently and company's dependence on the luxury segment? Sir, it's a good question. I think, again, this is a very important factor for our industry as as we all know COVID, unlike all of you do, is the second half of the year. So October to March, we are expecting here as to bounce back in this period. But now it's the time you take any business you get. Right? So if you're getting to open the hotel because you're taking on quarantine or you're hosting medical workers, you just do it because it reduces your suffering as long as it is above your you know, taking care of your cost and you're not out of pocket, you're fine. And that's what not only us, almost all hotel companies are following the same. Fair enough, sir. And lastly, can you guide us with your CapEx plans for next two, three years if possible? Two, three years, we can't pay. The only good news is I will let mister Sanjeevi answer the second half of the question, which is what we are doing is the necessary. So we have to finish, for example, the in Delhi, which is only one month that needs to finish. So we will do that. The second is on on on on the Man We are renovating Man so we will have that also. And third is things that we have started. Like, we have started building a micro group in Bangalore. So we'll finish it, and we will open it next month. Yes. Yuri? No. I yeah. No. That's right. I think I think we are focused on what is the most important at this point of time. Everything else has been kind of deferred until we get better clarity. Clearly, at this point of time, cash conservation is critical. So I think, I don't think we'll be able to answer for two, three years because, really, if the business recovers, so what we have kind of deferred, we'll go back. Like, to Jingus Santa Cruz while for a can we see better visibility on that? Then, you know, at this point of time, of course, I think that even though they're starting to be important, but the kind of the first. So I think we'll be very prudent in terms of how we sort of spend money on the. Yeah. Sure, sir. Thank you. That's all from my side, and all the very best. Thank you, sir. We now take our next question. Yeah. Hi. This is Achary from HSBC. So I had I had couple of questions. The first of all, I wanted to understand so as you rightly said, you are in cash conversion mode. And, of course, the answer is is too high. So what what what drove you to to still go ahead with the dividend payment? And so that was a bit unclear. So if you could please help one, what was what was the why why you decided to go ahead with the dividend payment? Dividend payment. I think you're you're saying why we declare the dividend. Is that what you're asking? Yeah. I mean, exactly. So what was it that drove you to still announce the dividend payment when most of the companies are cutting the dividend because the you know, I'm Yeah. No. I think we have to be you know, if I answer that question, I think, you know, last year, you know, we have retail shareholders. And if you see, you know, while I can't talk in terms of the future numbers, I think very clearly, this year, you know, given the COVID impact and the current financial year, there is going to be a significant impact of the end of it. So therefore, we thought that it is unfair for retail sources not to get the dividend reduced dividend of this year and maybe minimum dividend in the next year. So we just felt that it is it is only fair that we kind of maintain the same dividend of 50% that we announced. And this year, as you know, there is no different distribution tax. So while this while it's it took away last year, cash of 71 crores. This year, the cash outflow was about 59 crores. I think in the overall scheme of things, I think it's very difficult to sort of look at every expense and say, was it good or bad? I think we'd rather take a balanced call on what is the right way of approaching business actually. And we genuinely felt that this is the right thing to do for the shareholders, especially the retail shareholders, actually. I think it's okay. It's fine. Even if we have reduced dividend, we may have saved maybe ten, twenty stores. That's all. Nothing more than that. Fair enough. The other thing I also want to the the NCD's commitment for the next two years, which which ranges about 40,000,000,000. So how so how are you planning to meet those commitments? I mean, are you gonna finance them? How how are you planning to meet those commitments? Because at the moment, I mean, I think you need to finance those. Right? I mean, so how are you planning to do that? What what what commitments? What what commitments is it? MCD. MPD, non convertible debentures you have. And so how Yeah. Yeah. Can do that about Yeah. Which is fine. That that those payments are coming up next year. As I said, we are very prudent in terms of how we are approaching the financial market for liquidity. We enjoy tremendous trust and reputation with the market. We are pursuing a monetization strategy. So at this point of time, if you ask me, I think we will be fine in terms of being able to meet the commitment section. I don't think there's an issue at all. Right. Okay. Okay. In terms of in terms of in terms of cost, so I mean, you you outlined that how you're how you're trying to cut cost. I mean, I I know, of course, most of the hotels are closed until you have cut down the cost in this country. But as you start reopening those hotels, the the cost will start coming. So how how do you see I mean, to the how the cost is would evolve? Because if if they have more cost, I mean, 6%, then probably, even if you would even even if you open some hotels, you will have to you will have to pay some more cost. So do you think that profitability would suffer in the in the in the in the next few months due to as you as you open the business? Or or do you think, actually, no, that's not the case? And secondly, how how your cost structure would apply once the once the once your business is open fully? And so you must have you must have reduced some of the cost or of the there is there must have been some structural decline in the cost. So how would you how your cost structure would be applied once your business opens completely? Yeah. So I I think I think we need you know, I think that thank you for the question. But I think that I it is I think we are seeing substantial progress in terms of cost saving. We are looking at it as as I told you even in the dividend question. It is not one line of cost in terms of the comments on what we are doing. It's about in the aggregate, the way we are approaching the all the different cost. And and and I think some of the structural changes we do is something which is unpredictable. It is not something which should be achieved in three months time. So I think the COVID has given us an opportunity to restructure. We already started it under that kind of aspiration, and that will continue. So my my my request is that we will be able to give you a better update in the quarter in terms of the progress we have made. I've already outlined you for the time of cost savings that we're expecting in our domestic and international presence. So when we meet next, at the end of q one, we'll be able to say what more are we doing it. So I think we will have to take it one step at a time in a very sensible fashion. I don't think we can take major reactions in terms of cost reduction then. Right. Okay. And the last question, if you could please update, I just wanted to understand. So now you had given a target that you'll be opening 15 hotels every year. So so would you be would you be focusing more on the on the ginger brand? Or or, sir, if if you could please give a sort of a bit of a sense in terms of how the how the mix would look like? Yeah. You you want my I think we we did not say we will we said when we started the aspiration 2022 that it will add 15 hotels to our pipeline every year, which is possible because we have so many signed contracts that we end up opening also around 15 going forward. But definitely, in terms of number of hotels, the ginger brand would be definitely ahead. Up till now, it has been the Taj and and and Divanta and Selections. But going forward, in number of hotels, it will be ginger, but in number of rooms, it will not be ginger as ginger could be smaller property, sixty, eighty, 120 rooms. Because in that business model, you can still make money in a smaller set of property. So there are two large jingles we have envisaged. One, we have announced. One, we have not yet announced, which we are not allowed to at the moment as it's in a it's in the confidentiality phase, but the one which we have announced is the Santa Cruz, and it will take three years to get built and open. That's a 371 room one. But the other the average size of ginger, if we can achieve above 100 rooms, it's very, very good. So, yes, number of hotels because you can have a ginger you know, you can have twenty, thirty ginger properties in Mumbai itself. So that's the that's the kind of branding. And I always give example of some other chains and some other big cities of the world. They have sometimes more than 100 hotels among their different brands in one city alone. So, of course, India is not in that life cycle phase in its economy. But if you can, if others can have 100, we can have ten, fifteen, 20, but different sizes in different areas of the town. Perfect. Thank you so much. But the total number of rooms will not exceed, let's say, you know, Taj Mahal Palace Tower plus Taj Lands End plus Taj Santa Cruz, the number would the those three hotels put together, the three Taj put together would be equal to maybe 10 or 12 ginger rooters. Right. Okay. Thank you so much. Okay. Shall we take one last question, please? And then, of course, we can happy to converse offline. So one last question. Okay. Sure, sir. We take our last question for today. Participant, your line is open. Please go ahead. Yeah. Hi. This is Vinod here. Am I audible? Yes. Of course. Hi. This is Denod from. I'm here on 13 times, but does management have any sort of broad expectation about sort of the recovery path for the year both in terms of occupancy and and and day rates next, say, twelve months, fifteen months, how things could pan out. And based on that, do we have I'm not fully into that, but do we have any near term debt payments in next twelve months that that is of one vision to us? Yeah. No. I think I think we have not yet signed up we do not have any guidance in terms of what will happen in the next year or so. I think that is I I think we've just started seeing the opening up from the lockdown. And and as you explained for us, October to March within the African industry, we we basically see it at about 65% of the business normally during this period. So I think we've seen good experience in China, and it got that pattern of recovery happening, and we kind of come back to a reasonable level of recovery by October. I think it will be great. So I guess maybe the next quarter's call will probably be much clearer in terms of how to see the patterns of recovery. In terms of debt repayments, we only had one major debt repayment this year in the month of last month. In the month of April, about 200, which we have repaid. And there's nothing other no other major debt repayment we're expecting in the in the current year. So we're fine. Fine. In many cases, I said that we enjoy huge credibility with institutions. So our ability to refinance and raise debt of different maturities. And as I said, we have no reliance on short term debt. It's kind of fine. So as of but we don't have concerns on our balance sheet and debt repayment capability at all at this point in time. Please wait while you are joined to the event. And then, of course, we can have it in converse offline. So one last question. Okay. Sure, sir. We take our last question for today. Participant, your line is open. Please go ahead. Yeah. Hi. This is Vinod here. Am I audible? Yes. Of course. Hi. This is from faculty. I know you're uncertain time, but do management have any sort of broad expectation about sort of the recovery path for the year both in terms of occupancy and and day rates next, say, twelve months, fifteen months, how things could pan out? And based on that, do we have I'm not fully encouraged with that, but do we have any near term debt payments in the next twelve months that that is of of transition to us? Yeah. No. I think I think we have not yet signed up we do not give any guidance in terms of what will happen in the next year or so. I think that is I I think we have just started seeing the opening up from the lockdown. And and as you explained for us, October to March, the industrial industry is the critical period. There's about 65 of the business normally coming during this period. So I think if you've got experience in China and if that pattern of recovery happens and we kind of come back to a reasonable level of recovery by October, I think it will be great. So I guess, maybe the next quarter's call will probably be much clearer in terms of how to see the patterns of recovery. In terms of debt repayments, we only had one immediate debt repayment this year in the month of last month, in the month of April, over 200 crores, which we have repaid. And there's nothing other no other major debt repayment we're expecting in the in the current year. So we're fine fine. In many cases, we enjoy huge credibility with institutions. So our ability to refinance and raise debt of different maturities, and as I said, we have no reliance on short term debt It's kind of fine. So as in we don't have concerns on our balance sheet and debt repayment capability at all at this point in time. I have two small questions as well, if I may. A, you know, based upon your reset cost program, what will be the the EBITDA breakeven occupancy for you? Or can I put cash breakeven EBITDA and interest cost put together? What will be cash breakeven occupancy rate for you? Yeah. So I think I think it's a great question, but I think that question is going to be answered if we are if this approach to cost reduction is kind of claimative. I think we have to I think our approach to cost reduction is much more holistic in terms of what we have done across the line. I think in general, I would say that maybe 50% occupancy is what we will do that, but but we work on it. I think and and and a lot depends on our recovery of business. So I would say 50% cash breakeven is probably a ten month. Right. And and lastly, in this management contract business, which was great quickly were to pull up margins and growth and then asset light approach, do you think that business will be under greater challenge than our native asset ownership business? The the asset owners will have to continue cash flow. So a, is there a risk of losing some of those properties that they may not come back so easily back to business? And b, growing the inventory management business, can that be also a challenge? Yes. I think I think It's a very, very, very good question, Giri. If I may go first and then you are Yes. Yes. Of course. It's an excellent question because this is exactly what will happen. So not just with us, but in the industry, it will happen. You do you know, bad times is a good rest of the relationships. And as a as a part of a legacy hospitality company, as we mentioned before, we have to do the right things and not necessarily be the fastest. So if our owners are not in a ethical behavior with the employees or with other things and take unnecessary his defects, it does spoil the relationship and maybe we have to walk away from each other. Right? So that's what happens if you have a third party contract and you figure out a way. But the because of all the goodwill that has been generated around the task name becoming the nation's own for all millions that we delivered for hosting the medical staff, for all the reasons that we have been in the television and newspaper news. There are a lot of people who will also want to partner with us because they're dissatisfied with another brand. So this will definitely happen. It's a consequence of such a market situation that the market is confronted with, but we will not do anything that is not right. For example, you know, it's it's a liability in terms of a company's having valid agreement with another brand. So we will not go and push them unless they have been if it's their relationship and today don't have a brand and are allowed to negotiate with us, only then we will do that. And we hope the rest of the industry will respect the same with us. So but there is a natural and a normal consequence of this pandemic in a asset light growth model is that there will be some that we will lose and some that we will gain As long as the gain is higher than the loss and it's more profitable and brand enhancing, then it can be even a good thing. Sorry, Jerry. You cannot No. That's correct, actually. And and I think you answered it, Puneet. I think I think that's exactly the case. And, of course, some owners, beyond ethics, as Puneet said, some owners will have, you know, some of the single property owners that we have have their own challenges on Beaveridge. So I think I think some of these people will be able to service service possible that that we see not just for us, but for the other, there could be more IBC type cases on on single property ownership. We'll see. And that also creates the other opportunity to go on platform, seeing that in this release test that is whether, you know, which will which will come up in the market, give us opportunity to look at some acquisitions through the VIP platform as well. So I think I think, yes, we will see some changes interesting changes in the next one year. So if I may, is this if any statement of yours, does that get get damaged more structurally in the in the current environment? I mean, the revival may lag the revival in the room business. Is that a fair assumption to make? No. I don't think so. In the short term, yes, because of the number of people allowed by the government for functions, you know, like, mostly, it's limited to 50. So as you said, there is two shall pass. It doesn't mean that there will be no weddings happening in six months or one year from now for more than 50 people or no meetings or no conventions. I mean, once there is a life during COVID, then there will be a behavior pattern post COVID, and then there will be an era post vaccine. And I think we have to treat these phases differently. So, of course, in the interim, that is affected. That is the truth. But if we are able to launch this kind of home delivery and other food businesses, microbreweries, I think it is a new source of F and B income also. It may not compensate for a 501,000 people wedding, but it is a new line of business. So when that business comes back, this will add on top and and improve the f and b revenue. But in the short term, both room revenue, f and B revenue, other revenue, everything has been has been affected negatively. Sorry, Giri? No. That's correct. And I think one of the factor to note is that what we believe will happen is that the high street response will definitely suffer more in terms of the trust factor. And I think, therefore, we believe that this front in the high star hotel, the bigger hotel would probably benefit because of the perceived trust in terms of social distancing and hygiene. So so I think let it panel. Sure. But that's all we today. Yeah. That's all we have for today. Thank you. Thank you all for your times. And and in case, our teams, we are kind of engaged with investors in in in as we go forward. So we'd be more than happy to do specific investor calls. In fact, some of our already being set up in the next couple of weeks. So so thank you all for your time, actually. Thank you, everyone. Thank you for joining. We can close the call now. Yes. Thank you. This concludes today's conference call. Thank you for your participation. You may now disconnect your lines.