Good day. Welcome to The Indian Hotels Company Limited Q2 full year 2020 earnings call, being hosted by Mr. Puneet Chhatwal, Managing Director and CEO, IHCL, and Mr. Giridhar Sanjeevi, EVP and CFO, IHCL. As a reminder, all participants' lines will be in a listen only mode, and there will 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 Chhatwal. Please go ahead, sir. Good afternoon, everyone. As always, I'm here with my colleague, Giridhar Sanjeevi, our Executive Vice President and Chief Financial Officer, to share with you our Q2 results for the quarter ended on 30th of September. Let me first begin with the news about Lake Palace. The Taj Lake Palace, the most photographed hotel in the world, celebrates 50 years this year, and we're very proud. We have extended our partnership with the family, with Fateh Prakash, which we announced and opened a year and a half ago, which is also being renovated. The pool, the spa, the gym have opened there, and we are extending this partnership, about which you will hear within the next week to 10 days. Going on further, I think it would be right to mention that as per latest IMF forecasts, India is expected to grow at 9.5% this year in this financial year, and the world economy also at approximately 6%. This is important especially for our sector, which relies very heavily on the growth of GDP. Not only GDP, but today is a very historical moment and an important day when we completed 100 crores of vaccinations. Since May, there's a 90% drop in active cases from COVID-19, and positivity rate has dropped to less than 1.5%. The air traffic is increasing by leaps and bounds in the last six to eight weeks. At the moment, approximately 70% increase. There's ease in travel restrictions, and leisure is driving the revival of room nights in our business. All in all, some of these factors have been contributing positively in the second quarter. We all know that quarter one was a washout for us, exactly like quarter one last year, because in the first quarter, April and May had serious disruptions because of the second wave. Before travel could start again, we were almost towards mid-end of June. The real momentum we saw coming was first in the month of August. Very surprised positively in the month of August. We recorded the highest revenue in the month of September, as this chart depicts, and both at the enterprise level as well as at a consolidated level. We see this trend continuing in the month of October. As I speak to you today, if we looked at month-to-date revenue in October, it's experiencing a similar trend as we saw in the month of September. A strong recovery in Q2. This was a bit unexpected, because we thought the 2nd wave, the aftermath of the 2nd wave would derail the industry for a longer period. We are very pleased that in this quarter we had a significant increase in revenue, getting us back to more than 70% of the pre-COVID levels. To be precise, 73 and 77 respectively on a consolidated and at an enterprise level. The consumer sentiment turned positive in terms of travel, and the booking windows were short. A lot of travel started happening, especially, as I mentioned before, in the leisure. People really thought about doing the travel right here, right now, because there has always been that inherent fear of the third wave and things shutting down again, which is diminishing as we move from week to week in the last few weeks. The outlook has got strengthened through weddings and MICE has kick-started. As I speak today, a large conference is happening at Taj Palace in Delhi. A week or 10 days ago, there was a large conclave again at Taj Palace in Delhi, and we did a few more bookings at some of the Taj properties for larger events of approximately 200 people. That has got the hotels and the lobbies and the restaurants pretty busy. We are noticing another trend that the brands are benefiting not just in hotel sector, not just in hospitality business, but generally the COVID Impact has been lesser on the brands, so the brands are gaining more and more market share. Definitely with our Taj brand, we are very well positioned to get a higher market share definitely on the Indian subcontinent. One picture which was negative for a long time, which is beginning to turn positive, is on this chart. If you see the industry recovery and the recovery of IHCL. On the right, where the recovery is low, and I mentioned that a few other times, today Mumbai, Delhi, and Bangalore are back to 75%-80% of pre-COVID level revenue. The leisure stays at a disproportionate share. We would exceed the pre-COVID levels, and now we are seeing the left part is coming very close to the industry level, is beating the industry level. In one or the other market, you might see that we are falling short where we have performed very well, like Goa. We expect a 50% increase, but we have some new hotels, so it's not a like-for-like comparison. The like for like, it might be showing that we are a percentage point behind, but I don't think Taj Fort Aguada and Holiday Village in the last decade have performed as well as they perform now, including Exotica. They are already above our pre-COVID levels. That's positive news. Also on all India level, it's good news that we are having a higher share, as is evident from all the percentage on this chart versus the industry level. The source of this chart is STR Global. Moving on to the next slide is, we took a decision not to compare to Q1 and not to compare to Q2 of last year. I think it would be fair to compare to Q2 pre-COVID levels. Our pre-COVID level, we are still down 23% on expenditure, 19% on total fixed costs, and 16% on corporate overhead. That's a very healthy decrease because as we start to come back in terms of top-level revenue, some of the costs, especially the variable costs, are bound to increase. Our job would be to keep a strict control not only on variable costs but not allow fixed costs to increase that high. Some of the rent payments negotiated with our landlords, some of the other payments negotiated, they will certainly go away. Some of the fixed costs will also climb back to where we were coming from. That's why it's showing a 19% decrease, which is a very healthy decrease because it's compared to Q2 of 2019 and 2020. When we move on further, our staff to room ratio, we mentioned that on a few quarterly calls. The industry has had a one-time opportunity not just on optimization of manpower, but in optimization of all costs. Because of COVID, there was enough time to review each and every cost. As you will notice, the Taj brand, the manpower ratio reduced from 2.17 to 1.6. I recall very well saying some of you might think that 1.6 is still very high when you compare to other brands, I don't think no brand in India have the kind of palaces we have or have the kind of safaris we have, and they definitely require a different room-to-staff ratio. We've been able to bring down the room to staff across the board in all the brands so that IHCL consolidated has gone down from 1.5 to 1.1. Some of this will increase as more and more business comes back, maybe to 1.2 or 1.22. We'll hire some contractual and some fixed-term contract manpower. It will again go up, which is normal because business is fully back. We have been able to optimize this ratio without disturbing the quality of our service, without disturbing the quality of our brands, and by eliminating things which were not needed or areas that were not needed. Going further, I think it is very important to us, it is very important for Tajness, it is very important for the culture of who we are as we define Taj as a brand that stands for trust, awareness, and joy. Our staff magazine, Tajness, is one of the hallmarks of demonstrating Tajness at a staff level so that they can deliver the service of Tajness to our customers. We have recently launched an employee app. This was done just 10 days ago on My Taj so that employees can easily communicate with each other. This was done at a stars function which we have, in which some great exemplaries are honored and recognized, which we call the Managing Directors Club Awards ceremony. To top this all up, our vaccination drive has been very successful. 82% of our staff is fully vaccinated and almost 100% partially vaccinated. In terms of unlocking value in new brands and business, this has been our area of focus since last 16-18 months. Qmin has expanded its presence in 19 cities. Today, there are 4 lakh app downloads which have converted into 4x more in orders, so 16x orders. 75% orders are from the top five metro cities. In the secondary and tertiary markets, still the penetration of Qmin is not as strong as it has been in the metros. At an enterprise level, in the first 6 months alone, Qmin was able to generate INR 50 crores of revenue. This, of course, includes our efforts on Meals to Smiles, which we thought was a good service to the community in the way our founder had laid down in the philosophy when Tata Group was founded. Also a way to market the brand and taking it into the different distressed areas so that people not only get healthy food, and that they get the supply in time, but also get associated with our brand. That was about Qmin. When we get to our wholesale brand, amã, we are at almost 60 properties, 59 to be precise, in 30 locations across India. This year alone, we have signed in the first half year, 21 new villas, and 15 of them have also opened. Our portfolio is 59, of which 34 are in operation today. We expect to achieve our guidance that we have given of getting as close as possible to 100 amã properties before the end of this financial year or immediately thereafter. Moving on, I think Ginger is a very important part of our business and our brandscape going forward. We have worked a lot on Ginger in the last three years. We've communicated consistently on Ginger during our investor day, in all our investor meetings. Today, Ginger has a portfolio of 80 hotels. In Q2, Ginger actually achieved 84% of pre-COVID revenue. That is a significant development as far as Ginger is concerned. The EBITDA was not only positive in Q2, but also positive for the entire first half of the year. Very important is the Q2 margin of Ginger was higher than pre-COVID level. This is coming through a different mix because the new properties that we have opened are in that category of the new reimagined and repositioned Ginger, and that is driving much higher margins. That makes the Q2 margin higher. Going forward, we do not see any change in this kind of development. If at all, it will only continue to increase as far as the Ginger brand is concerned. A very important development, today we have got the approval from the board of Indian Hotels to make Ginger 100%. Ginger was 100% brand always owned by Indian Hotels, but Roots Corporation to become a 100% subsidiary or wholly owned subsidiary of IHCL. We currently hold 60.2%. We'll buy out the remaining 39.8%, and we think it's an opportune moment. The brand is well-positioned to grow and has a huge scalable potential in all possible tiers, not only tier 1, tier 2, tier 3, but Ginger can be present in every location and could boast of significant presence in any key metro city with more than 10 properties in one city. Moving further is the financial performance of Q2. We were up 132% on revenue on the top line and INR 180 crore EBITDA from a negative to a positive territory. I think very important is that July, August, and September, all three were EBITDA positive months, of course, September being the best one. We expect this trend not only to continue but to exponentially grow in the month of October. What will happen in November and December should not only be better than October. The only thing we don't know is uncertainties in the macro environment or anything else that may come up, which we are not aware of today. Going on further to the revenue and EBITDA snapshot of IHCL consolidated for the first half year. I think it's a bit challenging to have first half because we all know that first quarter was a washout. Still, compared to last year, there was 125% increase on top-line and almost INR 300 crores, or to be precise, INR 292 crore improvement at the EBITDA level, even when comparing the first half to last year. The same picture we see on the standalone. The percentage is a little lower in terms of increase in top line, but again, an improvement of INR 180 crores at the EBITDA level for the first half of the year. All trends are with all these last three charts that we have shown to you are moving in the right direction. I think there is a strengthening of balance sheet has been a key priority, and there has been an increase in consolidated net debt. It has been up 86% from the pre-COVID level. We were at INR 1,900 and have reached INR 3,500 now. A marginal reduction from INR 3,600 to INR 3,500. That's where we stand, and that's why we will be very focused on strengthening our balance sheet because of the rise in debt levels. The board has today approved an equity issuance to build a healthier balance sheet. We are not only going to reduce debt, our aspiration would be to bring the debt to zero level, not only through the rights issue or QIP, but also through internal cash flows, because this amount is larger. We are looking at an INR 2,000 crore rights issue and INR 2,000 crore QIP. A part of these monies would be used for consolidation, as we just now shared on Ginger or other companies, which is in line with the strategy of the company to drive simplification of our business model, and also provide the necessary CapEx for the growth of our portfolio and the renovations which are needed in the portfolio on an ongoing basis. I think with that, I will hand over to my colleague, Giridhar Sanjeevi. Yeah. Thank you, Puneet. I think going into some more details, I think as Puneet said introduced, I think essentially if you see the Q2 performance, there is a significant recovery as compared to the '19, '20. The INR 481 crore top line in standalone represented a 77% recovery as compared to '19, '20. EBITDA was positive at INR 80 crores as compared with -INR 54 crores. If you look at the consolidated numbers, INR 752 crores, which represented a 73% recovery as compared to the Q2 of '19, '20 actually. The good news is EBITDA was positive in all the three months of Q2, resulting in an EBITDA of INR 97 crores, and PAT was INR 127 crores as compared to -INR 230 crores in the previous year. Go to the next. Similarly, if you look at the H1 performance, the H1 of course, was colored by the second wave of the pandemic in Q1. At INR 707 crores, it was a 57% recovery as compared to the 2019-2020 period, and consolidated was across INR 1,000 crore level, INR 1,123 crores, which represented a 54% recovery. EBITDA was positive at a standalone level for the whole of H1, and EBITDA at a consolidated level was marginally negative at -INR 26 crores. Overall, the PAT losses have also come down to INR 398 crores and consolidated at INR 244 crores in standalone numbers. Go to the next. This is an interesting chart, which is at an enterprise level, which talks about what is the pattern of recovery. The way to read this chart, if I take the top box, which is domestic hotels, the bottom box is international hotels. In the top box, in Q1, we were INR 415 crores at the network level, which represented 38% recovery as compared to 2019, 2020. If you see what happened in July, August, and September, from 38%, it went to 80% in July, 88% in August, and 88% in September. Overall leading to 86% recovery as compared to the same period in 2019, 2020. On international hotels, we were at INR 176 crores in Q1, 37% recovery as compared to 2019, 2020, and that jumped to 58%, 63%, and 66% in each of the months from July to September, overall giving a 62% recovery as compared to 2019, 2020. Therefore, I think Q2 has seen a dramatic shift in terms of recovery. If you see the performance in the different cities, it mirrors exactly the same, which is 66% in Bombay as compared to 33%. I think you see the leisure cities of Goa, 121%, Rajasthan 152%. I think very strong recovery in the leisure cities, strong recovery in the other cities as well. We are seeing clearly a very strong recovery in Q2, which is continuing in October as well. If you look at the international hotels recovery as well, the USA jumped from 13% to 56% in 2021, 2022 vis-a-vis 2019, 2020 in the same quarter. U.K. was 56%, and those two geographies matter because those are consolidated numbers. Maldives is an associate, 108%. Dubai is 136%, but of course on management contract. Africa is small, 40%, but for us also Africa is a small business. Sri Lanka is gradually coming out of the pandemic in terms of recovery. It's also a very small business for us. There's clearly strong recovery in the international cities as well. This is really going into a little more detail in terms of the performance trend at total revenue, EBITDA, PBT, and PAT, where we live, as we just discussed, INR 1,123 crores in revenue. EBITDA was marginally negative at INR 26 crores. PAT was about -INR 398 crores. Q2, EBITDA was obviously positive at INR 97 crores. Go to the next. Similar to the standalone trend that mirrors the consolidated trend with very strong EBITDA at INR 80 crores coming through in this quarter and overall being positive EBITDA. The losses coming down at a PAT level to -INR 344 crores. I think the other thing to note is in terms of how the leisure and non-leisure have performed both on occupancy and ARR. If you see what has happened in occupancy levels has jumped from in the previous year, Q1 was 20% and Q2 was about 51% in the leisure segment. The non-leisure segment jumped from 30% to 57%. The ARR in the leisure segment grew from INR 9,098 to INR 10,305, whereas the non-leisure segment went up from INR 4,530 to INR 5,697. We are seeing consistent growth both in occupancy and ARR in both the leisure and the non-leisure segment. In terms of the key international geographies as well, in terms of occupancies and ARR, we do see the growth in occupancies to 41% in U.S.A., 41% in U.K., Maldives 39% and Dubai 66%. ARR also have gone up in the U.S.A., in U.K., Maldives and in Dubai. Dubai has been of course, sort of broadly at the similar levels actually. I think the point is that both occupancies and ARR are showing growth in the international geographies as well. In terms of the key revenue drivers, I think if I sort of divide it between revenue recovery, asset light growth, and the new and reimagined business. Occupancy very clearly was 43%, which represented a +70% point recovery. In ADR, it was INR 7,800, which represented a 51% recovery, and RevPAR was INR 3,342, which represented 143% recovery. This is for standalone for the H1 current year versus the previous year. In terms of asset light growth, we continue to sign contracts. We have a portfolio of 225 hotels, 27,700 rooms in the pipeline. New openings are expected in 2021/2022 is 13+. Management fee has been about INR 58 crores. There is a 71% jump as compared to the previous year. The new and reimagined business, Ginger portfolio is now 80+. Qmin is now in 19 cities. Vivanta has 75 plus restaurants, and amã has 59 bungalows including the pipeline. On the cost management, very clearly cost management is driving operating leverage. We did see the revenue grow by 125%, the expenditure grow by 41% in consolidated. Standalone the revenue grew up by 113% and expenditure grew by 38%. Corporate overheads has shown a 25% reduction in H1, at INR 112 crores as compared to INR 149 crores in the previous year. Overall fixed cost per month has been INR 129 crores as compared to 19-20 of INR 164 crores. There is a 21% reduction. Manpower rationalization through redeployment continued. 312 people have been deployed till 31st August, 2021. Lease rental waivers continue in the current year for INR 17 crores or so achieved during the half year. The international hotels, if you see the performance, the U.S. performance has definitely improved in terms of revenue by 254%. More importantly, if you see the losses, the losses have come down from INR 71 crores to INR 18 crores at an EBITDA level. In U.K. as well, the revenue has jumped to INR 93 crores with the EBITDA being positive INR 8 crores. Occupancy improvement in the U.S. has been 27%-41%. ADR, if you saw as well, has been higher than the pre-pandemic level. The Pierre posted a positive EBITDA in Q2. It might not be possible, it is still very good. It is a result of the cost reduction efforts, in terms of manpower reductions, in terms of lease renegotiation. We backed out all the related restructurings. All of those have helped in the U.S. As well as U.K. concern occupancy has improved. ADR is INR 274, which is close to the pre-COVID level and Taj has posted an EBITDA positive in Q2 and in H1 actually. That is what has happened on the U.K. side. On the exceptional items, just a very quick comment. Nothing major on the exceptional items. Some marginal exchange losses on account of swap contracts of around INR 74 crores. Nothing else really. We had in H1 some lease and rent concessions of INR 17 crores on the operating and non-operating revenue. Moving on. On the standalone what is notable here is that since we provide for the cash losses here at the standalone level, you will see that the INR 71 crores of cash losses last year came down to INR 20 crores. For the current quarter, it was INR 7 crores as compared to INR 27 crores in the previous year. Nothing else to report. I think these rent concessions are about INR 30 crores in H1. Yeah. Performance of key subsidiaries, very clearly, as we said, Taj has posted positive, Hotels Corporation was positive. Piem Hotels also improved in performance, I think INR 92 crores was a significant jump. INR 90 crores EBITDA loss was there that is again recovering as we go forward we also discussed in terms of a lot of it coming down. In terms of the debt position, I think for the first time, we are seeing a reduction in net debt at a consolidated level. I think about INR 3,571 crores marginally as compared to the previous year. The point is that we do have liquidity we, for instance, we have one repayment coming up in the month of November. For the first time, we are unlikely to do any refin ancing. We will use our own cash to redeem the debentures actually. That's a big shift. The average cost of debt continues to be competitive, and we continue to stay focused on that. As Puneet mentioned in the first part of the presentation, earlier the board had approved a INR 3,000 crore rights issue, and now we have decided to up the amount to INR 4,000 crore by doing a modification to the rights issue amount to INR 2,000 crore and a QIP subsequently. We will do the rights now to be completed before December. The QIP, which will go to the shareholders approval, will potentially be done after the December numbers, which means sometime in February. Bottom line is that we will raise this money before March. It gives us not only reduction of debt, but the ability to do some of the consolidations we spoke about, the Ginger acquisition of the balance shares, all of these will come out of this. I think it's really giving us ability to not only reduce debt, but also pave way for growth as well, growth capital. I think the aggregate purchase consideration on Roots will not exceed INR 500 million. We expect to complete this transaction by mid-December. Emerging from the pandemic, I think what is going to happen now is that we will witness stronger revenue growth than the industry. We will be driven by asset-light growth, virtual balanced 50-50 portfolio. We will drive growth in new brands and businesses. These will become very visible, much more visible as we go forward. We will reshape the three engines continuous innovations, new ways of working, and business model innovations. We will reshape the balance sheet, not just with capitalizations. The time is also right in terms of restarting some of the monetizations. We will work on simplification, like the Ginger consolidation is one way of simplifying the structure. We do want to move towards a zero-debt balance sheet through all of this. I think rest of it is really detail. I think it is all being uploaded, which is all the consolidated balance sheet details. I'm not going to go into the details. I think, is there anything I need to speak? Nothing more. I think it's all there for the analysts to see. I think we are open to questions now. Change the slide. Change. Thank you. If you would like to ask a question, please signal by pressing star 1 on your telephone keypad. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, press star 1 to ask a question. We'll pause for just a moment to allow everyone an opportunity to signal for questions. I would also request everyone to state their name and the company they belong to before asking a question. We will now take our first question. Please go ahead, caller, your line is open. Yes. Thank you so much. Good evening, this is Nihal Jham from Edelweiss, and congratulations on the great performance, Mr. Chhatwal. Just three questions from my side. First is, obviously, we've seen a strong trend of leisure revival, probably to call it revenge tourism that has happened. I just wanted your thoughts that incrementally as you look forward, maybe till November, as you said, there could be a lot of weddings. Beyond that, is there a possibility that maybe the tourism or the leisure part of it stabilizes and you see a revival in corporate demand potentially taking you back to the recovery? A related question to that will be that, is it that the level at which leisure is happening, it could fall off partially from here, given that there is a one-off trend that is currently being seen? That would be my first question. I'll come to the other two after this, if you want. Yeah, Nihal, good afternoon. I think it would be fair to say, and I mentioned that while presenting, that the corporate demand is showing good signs of recovery. Part of that is evident in Ginger, which has gone to +80%. Ginger is not a leisure-driven brand, and that means travel started happening, and there is a direct correlation between the number of vaccinations and travel. People feel more and more secure or less prohibitive when it comes to traveling now. Also, we are seeing a lot of conference bookings are beginning to come in. Now, there are still some restrictions of number of people in different states and different cities and in terms of timing. The positive trend is that every day we hear something which is helping corporate travel recovery, whether it is allowing international travel, whether it is allowance on visas as on a certain date, whether it is people starting to do physical events. They are combining this physical presence with digital. It's not only digital anymore. I think tourism is very well-positioned as an industry. I'm not talking about leisure now. As an industry in helping build the relationship capital that has got lost, the relationship and social capital that got lost because we have dug into so much of reserve as mankind over the last two years in trying to do whatever we could on a digital basis or a platform, there will be an extraordinary need going forward for people to meet in person. In order to do business for the next five or seven or 10 years, you still have to build the reserves for the future. You have to build that relationship capital for future. I think that is what will drive demand besides the normal demand in corporate sector coming back. That's helpful. Would you expect maybe leisure travel slightly moderate from here? These are obviously trends where a lot of travel is happening together because of the lockdowns that were made. It's a difficult one to answer. I can say that personally, I feel that it will not. It will only increase. Having myself lived in the western part of the world, I saw a lot of people traveling by road, and it was not happening as much on the Indian subcontinent as it used to happen. What COVID has done is it's got people out in their own vehicles or traveling by road with family far more frequently than it was evident pre-COVID. I think maybe the leisure and vacation and displacement might happen to some extent as more and more people get back to work. The private holidays of families and the extended weekends will only increase and not decrease. Thank you, sir. Sir, my second question was to Mr. Giri, that on the cost-saving part of it, I just wanted an update that if you compare to pre-COVID level, what is the kind of targets that you still expect you'll be able to achieve? If it's again possible to bifurcate it between the key line items, specifically employees, marketing, and maybe other major heads. Yeah. I will answer this at a headline level, Nihal Jham. I think on the specific lines of employees and all, maybe we can do it offline. In essence, I think, if I look at the overall H1 numbers, last year if you remember, the overall fixed cost number reduction was above 28%. In H1, we have seen that the reduction vis-à-vis 2019, 2020 has been about 21%. For the quarter itself, it's around, I think, 23%, no 21%. I think we will continue to track it as for us this is a very important number, in terms of making sure that the fixed cost per month is kept at a reasonable level, and we continue to focus and not allow this to go back. I think just a very simple number at an H1 level, INR 164 crore was the monthly run rate on fixed cost, that has now come down to INR 129 crore in H1 of 2023. Thank you, sir. Very quickly, just last question. Out of the INR 4,000 crore raise, would it be right to understand INR 3,500 crore is to purely pay down the debt and the remaining INR 500 crore is the Ginger acquisition? Is that the way it'll be used in the upcoming 12 months? I think, wait for the documents to come out, which will give more clarity. I think very clearly the increase from 3,000 to 4,000 is a combination of different factors. Number one is to not just reduce debt, as I said, but also get growth capital consolidation and also Ginger is one of them. Nihal, I would like to add, if we did that means we don't expect to generate any cash on our own. There's only so much you can show on QIP. I hope that does not happen for the sake of the industry, not just for Indian Hotels. No, no, absolutely, sir. Pray for the same. I wish you all the best. I'm done from my side. Thank you so much. Thank you. We will now take our next question. Please go ahead, caller. Hello? Hello, can you hear me? Hello. Yes. Can you hear? Yeah. You have been saying, yeah. Who's this? Hello. Hello. Yes, now it's okay. Yeah. Hi. I just want to find out, the Indian hotel sector moves in cycles, right? Even pre-COVID, it was a little tepid. You think it's a long upcycle from here onwards? Well, firstly, your observation is accurate in that it has some correlation with our strategy on going towards zero debt over time, because of things that happen which are beyond anyone's reasonable control. Having said that, there is a unique situation, and that is that supply levels are very constrained. When demand comes back, your denominator is that at a constant or at a shrinking level because some hotels might shut down permanently or some of the supply might go out of the market. The cycle could be stronger because it's not that easy to build hotels that quickly. Definitely not in this part of the world. Okay. You think it can be a durable long cycle ahead because of what you just mentioned? That is anybody's guess, but the fundamentals point in that direction, that whenever you come after a crisis, this industry has bounced back far stronger than it went into the crisis. If we go to 9/11, as an example, in different parts of the world, the sector was weakening, and then there were two years of a downturn or a year and a half, and then it came on very strong in the years four, five, six, seven. Similarly, after the other crises, whether it was Operation Blue Star, the Iraq War, the oil crisis, whatever you want to call it. The sector usually and historically has bounced back always stronger. The only unknown that we have is the global geopolitical situation as well as the mutation of this virus, how difficult it will be or not. Are the vaccinations good enough? Are they going to hold? That's unknown. Otherwise, yes, I think you might be spot on that you're in for an uptick in the cycle. Points, why don't, it's a suggestion, you would be knowing better, in The Indian Hotels Company, why don't you form a subsidiary which has a much wider play and stronger play in weddings? Wedding being what it is in India, [Foreign language]. That's one suggestion. Second is even the catering part, it can be a much stronger play for you. Can you comment on that? I think we are already active on both of these. Maybe offline if you contact us, we will be able to show you all of our new brands on catering, on our wedding services, on our promotions on wedding. If you even take out the latest Vogue magazine, you will see six different pages addressing that. I think we have to always make sure- Okay. that we do not dilute the positioning, especially of the Taj brand. It is rated as world's strongest brand, we cannot be anywhere and everywhere. We have to be careful on how we find the right balance. Okay. Thanks a lot. Thank you. Sure. We will now take our next question. Please go ahead. Hi, Puneet. This is Amit Agarwal from Nirmal Bang. My question pertains to what you just talked about the equity issuance, about INR 2,000 crore and the rights issue also. I was reading in the press about some of the hotels of ITDC getting sold off. Firstly, are you bidding specifically for, amongst others, probably for The Ashok Hotel. Could that be one of the reasons why you're kind of putting some money out there? Secondly, is there a possibility that this Sea Rock Hotel development could be finally taken up by you instead of having somebody else come in as an equity partner? Thanks. Amit. Firstly, on ITDC, we are together with LIC, we hold 15% of ITDC. If hotels are sold and we get money back for our shareholding, that would be good news for us. That's the 1 thing. The 2nd is Ashoka Hotel is at the moment we have had no discussions and nothing that we have looked at as far as Ashoka and Delhi is concerned. Thirdly, on Sea Rock, we have not changed our strategy. We will not be doing, and we have communicated that in the investor day presentations and in previous calls. We will do it in partnership with someone who brings in the remaining equity or even buys in a share of our existing investment in Sea Rock to build that property. It's very large project, and I think we need to have a partner, whether we find it within our existing partnership or outside of that. We work very diligently on getting the permissions, and once we have that, we will seek a partnership and use capital from not our sources, rather from external sources. Sure. One last question, probably not focused on this particular quarter results. In terms of Qmin and let's say, Chambers membership, et cetera, as a percentage of total top line, where do you see it in next two to three years, if I may ask? We see that as a percentage of our target for what we call the new age businesses is around 25% of the top line and with contribution of around 35% to the EBITDA. This is the ratio we work on. Today they are less than 5%-7%. As we add more brands, as the previous person had asked some question on catering and other verticals that we have, and as these brands grow and stabilize, we think they can get to 25% of the total revenue base. Sure. Thanks. That is all from my side. We will now take our next question. Please go ahead. Yeah. Hi, Puneet and Giri. Sumant here from Motilal Oswal. My question is, we have seen a good recovery in the month of September and August, and as per the PPT, 86%, 88% of the business has already recovered of the pre-pandemic level. Can you talk about what is the gap of, say, 14%, 15%? How is the F&B recovery compared to pre-pandemic level? Occupancy side, we are seeing a good recovery, but ARR side, when we can reach at the pre-pandemic level in the coming quarters? Thank you. Sumant, as and when the occupancies have stabilized at a higher level, the rate will recover. You see that in the leisure destination. If the demand for leisure is high, most of the leisure destinations are doing higher rate than the pre-COVID level. Whether it's, let's say a Taj in Rishikesh or a Taj in Corbett or a Taj in Theog, in Shimla or in Goa or in Kullu, we are performing at a higher level than pre-COVID, both on rate and on RevPAR. When it comes to F&B, this is because of the restrictions, and most importantly, restrictions that we have had in Mumbai and in the state of Maharashtra, also in Delhi in terms of events. We are still, as a company, I would say we are still at 50% on food and beverage of the pre-COVID level. 50% of the recovery on the pre-COVID level in terms of the MICE, the meetings, incentives, conference, weddings, that kind of business. The restaurants are more or less back. The more we open up, including in Mumbai, we see that the pent-up demand is so strong that the visitation to restaurants is very high. As and when the norms get relaxed about 50% seating capacity, et cetera, I think these numbers are expected to grow. The trend is positive. The trend on larger meetings is also positive. It is positive because we are coming almost from zero level, right? The restaurants for a major part of the first half in Mumbai were only open till 4:00 in the afternoon. We were allowed to open till 9:00 and 8:00. We were allowed to open till 10:00. I think once everything opens up fully, this should not take a very long time to come back. Overall, leisure destination has already crossed the pre-pandemic level, and overall occupancy and ARR side also, we have seen a growth, I think, from the pre-pandemic level. Talking about the business destination, can you talk about the Mumbai and Delhi market, how things are happening in the October month and September month? October should be better than pre-COVID. Why? Because pre-COVID October had Diwali and Dussehra in the same month. It's not a real like-for-like comparison. We are expecting that for our portfolio, we would have a better October than in October 2019. Over. Can you talk about the New Delhi and Mumbai market? How is the occupancy in last two months and ARR, how things are moving? The Delhi and Mumbai markets are lagging behind, and also Bangalore is lagging behind. It is recovering faster than we thought. The occupancy rates are increasing rapidly which will obviously lead to higher rates. Like three months ago in Mumbai, in some of our hotels, we did a rate of INR 3,000. Now suddenly it is at INR 8,000 or INR 9,000, but it's still far away from the INR 15,000 or INR 16,000 we did pre-COVID-19 level. The recovery there from three to six or seven or eight has been like a three-month period or 100 days. Now we have to see what happens in next 100 days. It's very difficult to predict, but yes, the occupancy levels are very high. The last, what do you think about the MICE activity? How things are happening? Sumant, I answered that question a few times now. The MICE activity is picking up. Lot of big events are happening. They're happening in physical and phygital format. Both of those formats are happening. There is a kickstart in Delhi and Mumbai, which is very good, very encouraging. As I said before, there's an event which as I speak today, a very big conference is happening in Delhi in Taj Palace. There is a NASSCOM, there is a ESICONG, there is a lot such events. Today, there is a pharma congress. The other tomorrow also pharma. There's a government delegation that has gone to Banaras from a foreign delegation that has come in. There is a CII event being held in Delhi, it's the first time after two years in physical format on the fourth and fifth of November, and one of our hotels only. There is a lot of activity or reservations and inquiries which are coming in and are getting confirmed, which are incremental because they're not just weddings, these are actual meetings and conferences happening. They were not happening in the last two years. Thank you so much. We will now take our next question. Please go ahead. Shaleen Kumar from UBS. Can you hear me? Hi, Shaleen. Yes, Shaleen. Hello. Many congratulations, sir, on very good set of numbers. Really pleased to see them. Few questions. I could notice that our peer is profitable in second quarter, and even U.K. business is profitable both in second quarter and first half. Can you talk about the sustainability? Yeah, no, the sustainability is good. In fact, I think as we always told you, Shaleen, I think as far as the U.S. is concerned, there are two things that the cost measures have been very significant. Number one is the reduction in headcount which contributed something like two and a half million dollars. The second one is the lease, giving up the banquet space, saves about $2 million in terms of the banquet, plus the lease renegotiation, which is that. More than $5 million has been the annual savings in expenditures. That's number one. Number two, I think what has happened is that we have been managing the property also carefully in terms of lower F&B. The restaurant came later. That has allowed us to even manage costs, actually. Third, I think we have seen demand also being more in the suites and the higher category rooms. ARRs have also been kind of maintained, actually. Our view is that the U.S. performance is definitely sustainable. In fact, if I just talk about the cash losses, by last year, the cash losses were significantly scaled. We hope we can come back at levels of cash losses, which are not very different from what was there in the pre-pandemic year. Therefore, I think the U.S. recovery position is sustainable in that. That's number one. As far as U.K. is concerned, U.K., we never had any doubts because the U.K. has always been a market which has bounced back from these challenges very fast, actually, and we have seen that come through. Both of these markets, in my view, are strongly sustainable, actually. Now with U.K., things like Chambers that we've added is also going to add to the, what do you say, the flow of business. Thanks. My second question is, there has been a reasonable amount of cost prudence. Can you hear me now? Yes. Okay, sorry. I can hear you now. All right. Okay. There has been a good cost prudence from our side. Do you think that there would be some need of increase in investments towards brand building, maintenance CapEx going forward which we might not be doing during the pandemic time that may increase a bit of a cost from our side? No, Shaleen, I think the cost prudence we have done in a very clever way is we have not cut into the bone. It's just stopping the wastage because we have an obligation to protect the brand. On the contrary, if you recall, we upgraded 19 of our hotels just before the pandemic broke out from a Vivanta to Taj level. We are putting significant amount of money in Taj Mansingh, and The Chambers in Mansingh is a model for private membership clubs. If anyone has seen it, they would confirm that for you. This is going to continue. We are building the flagship Ginger with our own money in Santa Cruz, and that too, 371 rooms, which will be ready by December of next year. We have upgraded a lot of Ginger properties to lean luxe, is what we call them in the newly reimagined and repositioned Ginger. As one of the exceptional companies, we not only treated our staff with the care and respect they deserve, but we kept our growth going. Of course, we were not using our capital to grow. We were doing it more on an asset-light basis, but still, there is time and money that gets spent in doing contracts and doing travels to these places to have negotiations with owners. We have been spending money and looking at the mid- to long-term future of our company and our brands and not doing any short-term drastic measures. I think Giri had that on the slide, if you would recall, that we have redeployed more than 300 people. We never said we got rid of 300 people. We have redeployed them within the other group companies so that we are more agile and fast and less heavy in the corporate overhead. Finally, if you recall the figure that we had last year, it was a 39% reduction in corporate overhead. We may not be able to maintain 39% because some of the travel and business and all that is back. We are still very confident to keep that figure at north of 30% even in this financial year. That is what you will see also in the corporate overhead reported in the first half, is more or less the same as at last year's level. I think some of these cost savings we are going to keep because we've changed the way we work. Also, once we get Ginger, the Roots Corporation integrated into IHCL, that does not mean we destroy jobs, but we don't need to have different infrastructures. It will make us more efficient organization. Right in terms of corporate overhead. I just want to understand consumer behavior towards Qmin. Since things have quite opened up, it's also about experience when we go to a premium restaurant, like premium brand of Taj. How's the month-on-month trend for Qmin? My fear is that it shouldn't reverse. Like people could start to prefer more, so while it will be a credit for you, but people prefer coming to the restaurant than ordering. Is the reverse happening or you're seeing strong strength in both the places? It's a very good point you raised, Shaleen. We have been very aware of that. That's why we started with Food of The Taj restaurants we brought, which we are still doing. We introduced three months or four months ago Qmin comfort food. It brings down your average check, but not number of orders. On the contrary, we expect Qmin to stabilize at the level it was. Also Giri had that on his slide that the first half, we did an enterprise-level revenue of INR 50 crores on Qmin. That is not what we did in the last year, nine months that Qmin was open. We already crossed the first nine months of revenue in the first six months of this year, and we target to somewhere, anywhere between INR 80-100 for this year. If we get to that level, it is good because it is built on an incremental cost and incremental revenue and incremental profit level. It's not some kind of upfront capital cost, building a cloud kitchen, taking on a third-party app, paying a third party as a commission. We're all doing it on our own. That's what makes it highly profitable. With a revenue of anything north of INR 50 crores, we expect Qmin to contribute north of 50% in terms of margins. That's why it is an interesting business. That's why we say even if some of these new-age businesses may not be that big as a portion of the revenue, their contribution to EBITDA would be far higher as a percentage. Understood. Thank you, Puneet. Thank you, Giri. That's it from my side, gentlemen. Thank you so much. We will now take our next question. Please go ahead. Call your line is open. Hi, Puneet, and hi, Giri. This is Achal Kumar from HSBC. First of all, nice number. Thanks. That's a great result. Congratulations. Sorry, your voice was echoing, so I didn't get much of it. I'll touch base offline on some of the questions. Couple of questions here. First of all, on the Qmin, Puneet, as you said, you've done INR 50 crores in the first six months, what is the latest trend? Coming to the last question, the first six months was fine, then in the month of September and sort of August and September, how the trend looks like in Qmin? It's the same. We have been able to stabilize. Actually, it's not the month of September that is so critical. I think it's whenever we have festivals. When we have Diwali, when we have a Parsi New Year, when we have Dussehra, when we have this Bhai Dooj, whatever, the sales increase more during that time. There is a direct correlation that we are seeing with Qmin, either with the lockdown, when people are doing virtual celebrations, when a lot of celebrations were happening virtually. That is slowing down, and that is not happening to the same extent. Celebrations of festivals and getting that food at a reasonable cost is still happening. Don't forget one thing, there is a certain trust in the brand, where the food is coming from, how it is packed, and who is delivering it. That trust we enjoy. We have not seen a big volatility in the Qmin sales. It's more or less stabilized at the level that we have had month-on-month basis. Of course, as I said, we have to learn to replace virtual corporate celebrations, not the private ones. We expect Qmin food trucks, Qmin trailers, et cetera, to pick up. We had some initial starting challenges in terms of licenses, in terms of getting it parked in different buildings. I think with time, we have also had our learning, and we should be able to exponentially grow also the Qmin shops. We've only had one in President, but we expect to open at least five more before the end of this quarter, if not more. The Connaught will open, the Ambassador will open in Delhi. We have opened also Taj Wellington Mews, the Qmin has opened. That's has opened. That's already four. We are identifying the fifth one. It doesn't take that long a time to do a 50 sq m shop in a property that we have. Right. Could you quickly talk about The Chambers? You had 2,000 members. How are you growing? Are you expected to grow at 10% per annum in terms of addition of number of members? How are you doing on The Chambers? Chambers. The Chambers is doing quite well for us, Giri. You want to? The Chambers, I think the global membership is doing well. In fact, the run rate has been approximately about INR 5 crores a month at this point in time in terms of global membership. I think with the new, what do you say, Chambers in London and also the Delhi Chambers, I think we are definitely getting response. In the current year, we have had 156 members in the first half in new members actually. This is a very strong set of numbers actually. Previous year, full year was 164. Which means as compared to 164 full year last year, this year is 156 in eight months itself. Therefore, I think it's a very strong demand for Chambers. Right. We will be adding The Chambers in Bangalore and eventually also in a year, a year and a half in New York. I think this whole proposition of The Chambers will keep becoming more and more important and critical as it is again, a very high margin business when it comes to memberships. Right. Fair enough. [inaudible], I wanted to understand, Puneet, last time, I think you said that the average length of the stay has increased because people are actually driving down, so they are spending more time on the road, and hence they are spending more time in the hotels. The average stay length has increased. How the trend looks like now? Is the trend continued, or do you see there is a change and the length of the stay has come down? How do you see that? Similarly, booking window, has that squeezed or Sorry, has that expanded or the passengers are still booking at the last minute, very close to the date? How the trend looks like? Very good question. That has changed in terms of the booking window. It's starting to increase because especially the leisure properties, as they're getting fuller and fuller, people are now trying to book in advance because the last-minute deals got very expensive and people want to plan the Christmas, New Year's, et cetera. That window has increased in the last two weeks. Before the take-up was a very short booking window. In terms of length of stay, I think there are two trends. One is the QTA flights, the quick turnaround flights that you go from Mumbai to L.A. to sign a contract and come back. They will not happen as much because it's still with all the vaccination, with all the checks, whether quarantine or no quarantine, it's also a health issue. I think those kinds of travels have gone down by maybe 90%. Only 10% I even think 10% would be an overstated figure there. It could be almost anything between 0 and 10% as we speak today. Not many people are traveling for a two-day trip, three-day trip, as it's still considered risky to travel. If people travel, they will try to combine other businesses, whether they do it in different countries. Let's say if you were traveling to Europe or if you were traveling to U.S., you would combine the East Coast, West Coast and not do it in two different trips. That makes your length of stay in a country or in a continent longer. When it comes to domestic, that is getting balanced out because on leisure you are staying longer, but the business will go down. Why will they go down? There is a call by a majority of companies post-Diwali for people to come back to work. They cannot just work from wherever they are. I think it's not just Diwali, it's a global trend that people are being asked to come back. I think that will balance out that thing. Because people will come back to work, there will be more meetings, conferences, and business travel happening. It will be one segment replacing the other. Right. Fair enough. Finally, I also wanted to understand on the point which you raised last time about the loyalty members, and that could actually increase your business significantly. How are we doing on that? The super-app is still yet to be launched but otherwise, how are we doing? Then now, of course, being Air India holding to Tata, I think Air India itself has 1 million members. How do you see the loyalty program playing in this, and then when do you expect to see some results from that? I think as a hospitality company and one of the largest players, I think we are very well positioned to benefit both from the digital initiatives of the group as well as the airline business. We already benefit because of Vistara and AirAsia, and when Air India comes in, it will be very beneficial for our airline catering business. We already do almost like in Delhi, we do 50% of Air India flights already before even such a news came. Getting other businesses of delayed flights, canceled flights, cruise sales, and we are hopeful that we'll be able to synergize that. Yes, of course, at a group level, we hope, and we will do everything possible that we are well-positioned to benefit from such possibilities. What is your timeline in terms of the super app? Do you have any timeline? IHCL we don't have a timeline on this. That is a question to be raised to a different company. We are one of the members that are very keen for this to come as soon as possible. I am sure it will be communicated by the right people in the right time, in the right fashion. It has been launched for the staff. It is coming out every day in the press for the internal people to do it. That's a test. That is important test so that when we go to market, everything works seamlessly. I would prefer if you ask this question to the CEO of that. Okay, perfect. Thank you so much, and good luck. We will now take our next question. Please go ahead. Caller, your line is open. Yeah, hello. Good evening. Am I audible? Himanshu from PGIM Mutual Fund. Hello? Yes, Himanshu. My one question was on the capital raise what we have. We plan to be debt-free. Generally, the way we look at hotel industries, the return on capital employed is across the cycle, if we average five years and 10 years, it is high single digit and low double digit. If we even do not keep any debt on the balance sheet, will not the return on equity be also in the similar fashion? Is it right for us, because we have seen a very tough period, but do you think you will be happy for an ROE to be between high single digit and low double digit? What is your sense, and what are your thoughts on that? Something you can share your thoughts. No, thank you very much. I think you will have to look at our overall steps in multiple different ways. Number one is that, as we highlighted in the beginning of the presentation, I think because of the cyclicality of the business, very clearly coming down to a zero debt kind of a position is useful. That's number one. Beyond it, to answer your question in terms of return on capital employed and return on equity, what are we doing there? Number one is that our growth is largely asset light, which means the ability for instance to add to asset base because of growth is kind of minimum. That's number one. Number two is that if you look at the shape of the P&L, you've seen some of the changes to shape of the P&L being driven by cost reduction. Now as the new businesses start to begin, which are high margin, you will see that the revenue lines are also giving us a diversity beyond the room revenue and F&Bs. There's now The Chambers and Qmin and amã Stays & Trails and Ginger and all of those actually. The revenue base is getting stronger, asset light, high margin, the expenditure base is reducing. Overall profitability should go up. That is the second one. The third one is really from a balance sheet perspective. I think it is not just about this capital raise. I think we are also focused on simplification, which means Ginger is one of them. I think you will see monetization kickstart now. You will see some more simplifications kind of hopefully starting to happen in the next few months. The net result is that if you take all of it together, I think what we really see is that we don't expect a challenge to return on capital. In fact, in the 7th July investor call also, we segmented the balance sheet into domestic assets and other assets. The domestic assets, hotel assets, as you know, domestic hotel assets have a return on capital employed of 20%, actually. Whereas if you look at, there have been challenges on some of the other elements, whether it is the Sea Rock investment, whether it is some of the international investments, actually. Those we are addressing on a systematic basis. It could be a monetization of a property in San Francisco. It could be a statement that we are not bringing in more capital to the group, Sea Rock. We will be doing it through partnerships. I think the whole approach to P&L and balance sheet and growth has to be viewed in totality. I think what we are doing in terms of this equitization, the INR 4,000 crores to come down to zero debt is really one part of the picture. As Puneet said, the other thing is that it is not just driven by the capital raise. Very clearly, if we believe that this is going to be a sustained recovery in the hospitality industry performance, I think what you're going to see is the cash generation, free cash flow as we've been able to also should go up as a result. It's a combination of all of that, Himanshu. Don't look at it narrowly. We are very conscious that we don't want to be subpar in terms of ROC or ROE actually. See, I dig your point because if you see last 10 years history or the best years, even 2010, 2011, the numbers were not very high or significantly higher than 12%, 13%. That is the reason this whole question and thought is. Secondly, we have this amã and Qmin and all those ventures which we are doing. For our size of revenue, do you think all these measures can be significant data or bottom line contributor? Even if we have 100 amã. What type of service standards will we be able to deliver? With those service standards, can they be cheap? Can we make significant amount of money which can change our ROC profile or keep our ROC profile higher? Some of these measures and how are you focusing on those measures, if you can put some light on them. Okay. I think the new age businesses, what we call as the new initiatives. If you take Qmin as an example, I think we are not a [inaudible], which delivers the food at a rock bottom rate and a rock bottom, how do you say, margins, actually. We are doing it. Our pricing has not come down. I think comfort means the pricing for specialty today, the comfort food is really being maintained. The profitability on Qmin is still at a 50% level, actually. Therefore, these are high-margin businesses. As Puneet said, we are not building infrastructure. We have our existing restaurant infrastructure already in place. The people are in place. We are using existing infrastructure. There is no incremental investment we are making, and therefore, the margins, of course, in Qmin will be high. It is not going to be low. That's number one, without capital investment. Similarly, amã is a completely asset-light model where we charge 15% of top line as management fees and 3% of top line in terms of marketing reimbursement, actually. Now we are already at 59 properties being signed. As this grows, and in terms of self-delivery, to your question, we are now placing them close to an IHCL hotel. They are not stand-alone, and we are now located at 90-odd locations. Therefore, there will be supervision from the nearby hotels, actually. Because it is asset-light, I think even if I assume that an average top line of an amã is about INR 50 lakhs as an example, or it could be better, actually. Let's say INR 50 lakhs. 15% is INR 7.5 lakhs. If you have 100 villas, that itself is about INR 7.5 crores, actually. We can ramp it up further, our ambition, as we have stated in the seventh July meeting, is to really take it up to something like 500 villas or more, actually. The net result is that these all will be significant amounts. Qmin will be high margin, Ama will be completely asset-light. The Chambers is high margin in terms of what we are adding. All of these, really speaking, I think it's very important to understand that the new initiatives being asset-light, management fee growth also we highlighted the potential in our seventh July call in terms of where it can be, to be honest, actually. The net result is that all of these should add significantly to profitability and return on capital employed, actually. It's a very deliberate shift in terms of the way we are approaching the traditional business growth as well as the new initiative growth. One thing, we had properties where a large number of foreign tourists used to be there on the tourism space. Okay? Have we seen domestic tourists taking over those places? The occupancy has reached with what we were having even with foreign tourists was allowed in some of the premium properties? You think there is still lacuna in those properties, but others are doing well and hence the tourist is looking better? Some light if you can throw on that. No, that's a very good question. I will also add to the previous question, let me first answer this one. There were around 25 million people also traveling out of India who were unable to travel as much as they traveled before. If you looked at one of the slides where we showed Rajasthan did so much better in this first half, also the last year. Recently the Secretary of Tourism or one of the government officials of Udaipur was seen in news saying that the number of room nights was the highest in the last 10 years. Right? Goa saw a very big recovery, at very good rates. That's also what they have said consistently. The same is true for most of the leisure destinations. The ones which have suffered are still having a need to come back up is Delhi, Mumbai, Bangalore, those kind of big metros. The trend there is positive, and the people who were not able to travel out, they definitely more than compensated for the lack of foreign travel that was happening. For us, our palace properties in Jodhpur, in Udaipur, in Jaipur, in Hyderabad have done relatively well and have exceeded our expectations also. The other question which you had asked before. When we talk about amã, 50% of that portfolio is coming from our own group companies, whether it's a Tata Tea or a Tata Coffee player. They have also taken on the role of an internal aggregator. You are capitalizing investment. It's a model based on zero CapEx. It's a model based on the same general manager of a hotel looking after a few bungalows. If we go and we have six villas, it's the same person who's running Aguada and Holiday Village who also looks after these villas and his team. There is, of course, a charge which is put on each of the villas from a P&L perspective. We are not adding a huge corporate overhead or other kind of a cost structure to it, which makes this business very attractive and also very powerful. We are not going to stop at 50 or 100 because you're absolutely right. If we stopped at 50 or if we stopped at 100 with four or five rooms on an average, then it's like doing a 500-room hotel. Our pit stop that we have thought of ourselves is around 500 over the next 3-5 years. If we are having 500 villas, I should just correct my colleague, Giri, I think you look at our revenue per villa on an average going forward, post-pandemic, of INR 1 crore. Why post-pandemic? Because during pandemic, even villas were shut, so they were not operational. The effective revenue might have been INR 50 lakhs, but it was for four months or five months or seven months. Once you have a 12-month operation, I think it will get to INR 1 crore. If you have 500, you take your fees out of it becomes a substantial amount of business without any big capital cost, which you are incurring upfront or any other kind of risk that you are taking on. I hope it answers both your question. I think the domestic demand on the Indian subcontinent is strong enough and all our new initiatives and new brands, these are supposed to complement what we have been doing well for 100 years. One last follow-up. Okay. On the amã type of a property, where till last year, because of COVID, people wanted exclusivity, okay? want to be at a place which was less crowded, okay. Do you think once the fear of COVID reduces, people will move back to hotels instead? How do you look at that? Is there any fear or just some understanding? No, we don't have a fear. I think what has happened is that this homestay business is nothing new. What is new is a company like us went into it. That is the only new thing. Overall, all around the world, this has been a very strong business model, including in India. There are different other companies which have been running this business very successfully. Homestays or having these villas, if you live in Frankfurt and you want to go to Spain, your first choice is not to go to a hotel. It's to go and book a villa with family or two families sharing a large villa together. Even within Germany, to say, I will go to North Coast or East Coast or West Coast. This is what you do. The hotels in such locations are sometimes not sustainable because it's a very seasonal business. People use that as a real estate play, that they build a villa, use it for renting, use it for themselves and their family also for 1 month in a year or 2 months in a year, and rent it out for the rest. What we are doing is just taking away the hassle of security from them, the hassle of sales, marketing, and distribution. Same time, provide a brand which helps them in their capital appreciation and still provide them 1 month of stay for free. Whatever else comes out of it, we make our fee or money or what we are charging is 18% of the top line. That's why this model is a good model, and it's a very futuristic model, and it's definitely here to stay. Actually, it will grow exponentially in India, even after COVID is over. Yeah. Thank you from my side. It was pleasure speaking to you. Thank you. We take the last couple of questions now. [inaudible] Yes. Okay. We will now take our next question. Please go ahead. Hi, sir, this is Vaidika Tibrewal from J.P. Morgan. Sir, firstly, congratulations on a great set of numbers. Just two questions from me. You mentioned zero debt target. Any timeline for that? I think what will happen is that, I think very clearly you will see that with the completion of the capital raise, we will use it primarily to reduce debt, along with Ginger, we announced and a few other entities like completing the balance of the zero acquisition and all that is in concrete. This is at one level. The second level is we will have to start correcting the debt levels with the subsidiaries as well, actually. Which means that whether it is Ginger, whether it is zero, I think those will be the next steps. My own sense is that a substantial debt will come down by March. In relation to the subsidiaries and other entities, I think it will probably take us maybe another 18 months, I would say, in 12 to 18 months in terms of going to that level. I think we have to work through the details, but definitely it's an aspiration to have in terms of going. Got it, sir. On the new initiatives, you mentioned about 25% of your revenue as an aspiration. That seems really substantial. Yes the pre-COVID numbers. Which of these do you think is the most scalable one in your view? As far as new initiatives, when we spoke about 25%, it includes Ginger, Vivanta, Ama, Chambers, and the management fees, actually. Those are the five streams. I would say that Ginger is definitely scalable. I think Chambers is scaling up. Ama, we just discussed. Vivanta, we discussed, and management fees also we have discussed. I think all these five streams is what will end up constituting the 25% in terms of top line. Okay. Sir, just one last one from my side again. Do you worry about corporate demand not coming back to full and the metro city hotels basically lagging, and you needing to source demand from, let's say, lower ADR sort of segments? Or do you think that all of this should basically sort of normalize with the kind of traffic that you are seeing? No, we don't worry at all. Actually, we have seen a lot of this coming back and faster than anyone of us thought. I think it shows in the numbers. All this that we are showing is not coming only from leisure. There is already some corporate in there. Whatever the gap is, you will see that at the end of quarter three, unless there is some bad news, as I said before, in the month of November or December, you will see that a lot of this demand is coming back because it will not be just leisure doubling further. That's not what will happen because there is no capacity available. Whatever is there, if you have taken all of it, you have gone to 120% and 80% of business comes back, then you are back to 100% of pre-COVID levels. While presenting, I gave different examples of conferences happening, foreign delegations coming back. You know that is the government business which is needed to kickstart activity in Delhi and Mumbai, because typically they come to both the cities. National days of embassies have started. A lot of national days never happened. Or if they happened, they happened digitally. Okay, Qmin was a beneficiary. But now, 27th of this month, we have the first one of Spain being celebrated in Taj Palace, Delhi. This is another activity because then other consul generals come, then they also start doing it. I think it's more like people. I don't believe in the thing that people will now only work digitally and only from home. This is not a phenomenon that mankind is built for. We will now take our next question. Please go ahead. Call your line is open. What is your occupancy rate monthly? We can't hear you. Can you come closer to the mic and Okay. Occupancy rate monthly. Sorry. I think you're not very clear. Hello. We can't hear you. Your voice is not clear. Hello. Yes. Can you tell me the occupancy rate for the last quarter and what's the current rate? What is expected occupancy to be? It is there in the presentation. If you see what has been uploaded, it is near the end after the presentation in the annexure. We have given the occupancy and RevPAR sheets as well. You can look there. Okay. No problem. Thank you. It appears there are no further questions at this time. Mr. Sanjeevi, I would like to turn the conference back to you for any additional or closing remarks. Yeah. No, thank you. Thanks a lot for participating in today's call, I think, and for the enthusiastic response to the questions. We remain available. I think, in terms of any further questions that you may have, please don't hesitate to reach out to us, and then we can set up conversations in the subsequent days. Thank you very much. This concludes today's call. Thank you for your participation. You may now disconnect.