Restaurant India News: Leela Palaces Projects Strong Fiscal 2027 Growth on Luxury Demand

Leela Palaces Hotels & Resorts is positioning itself for revenue and earnings growth in fiscal 2027, supported by constrained luxury room supply and sustained demand from affluent travellers, according to its chief executive.

Consumer spending patterns in India have become uneven, with high-income buyers maintaining discretionary spending even as broader consumption segments face pressure. This divergence has supported growth across premium categories, including jewellery, premium spirits, and luxury hospitality.

Backed by Brookfield Asset Management, Leela currently operates 23 hotels across India, including properties under development. The company plans to scale its portfolio to at least 35 hotels over the next five to seven years, although it has not committed to a fixed launch timeline.

"We are at just a point of inflection of a multi-decade growth story in luxury consumption," CEO Anuraag Bhatnagar said in an interview on the sidelines of the Hospitality, Overview, Presentation & Exchange conference in Goa. He added that increased travel frequency among affluent consumers is contributing to demand growth.

For the nine months ended December 31, the company reported a 19 per cent increase in revenue from operations to Rs 1,043 crore (114.7 million dollars), while core earnings rose 24 per cent to Rs 540 crore.

Since its market debut in June, Leela has exceeded analyst expectations in each of the three reported quarters. Bhatnagar indicated that the company expects this performance trend to continue into fiscal 2027. According to data compiled by London Stock Exchange Group, analysts project revenue to grow 12 per cent to Rs 1,707 crore.

Industry supply conditions remain favourable for established luxury operators. India currently has approximately 30,000 luxury hotel keys, a limited inventory in the world’s most populous country. According to Bhatnagar, the expanding affluent consumer base is expected to support occupancy levels and pricing power.

In the December quarter, occupancy increased two percenta year-over-year to 71 per cent, while revenue per available room rose 20 per cent to Rs 21,551.

Although the company made its first international investment last year by acquiring a 25 per cent stake in a luxury beachfront resort on Palm Jumeirah, management indicated that India will remain its primary growth focus.

Leela’s outlook reflects a structural shift toward premiumisation within India’s travel and lodging market. Limited high-end inventory combined with resilient affluent demand continues to create favourable operating leverage for luxury hotel operators, particularly those with established brand positioning and expansion pipelines.