Annual Report Royal Orchid Hotels Limited
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Royal Orchid Hotels Limited Annual Report 2017 - 2018 Board of Directors Mr. Chander K. Baljee Managing Director Mr. Sunil Sikka Dr. Vivek Mansingh Mr. Naveen Jain Non Executive Director Independent Director Independent Director Ms. Lilian Jessie Paul Mrs. Sunita Baljee Independent Director Non Executive Director Dear Fellow Shareowners, Thank you so much for all the support extended to our Company. It's been another Thank you so much for all the support extended to our Company. It's been another remarkable year for the group overall. The Company is growing while we now have 48 remarkable year for the group overall. The Company is growing while we now have 48 hotels across 34 locations. We have added 10 hotels in the last financial year and counting. hotels across 34 locations. We have added 10 hotels in the last financial year and counting. I am happy to report that we have delivered a superior financial performance and I am happy to report that we have delivered a superior financial performance and continued strong growth across all areas of operations. continued strong growth across all areas of operations. Royal Orchid Hotels has delivered robust operational and financial performance during the Royal Orchid Hotels has delivered robust operational and financial performance during the year resulting in standalone net profit of ₹ 1,097.57 lakhs showing a growth of 95% year on year resulting in standalone net profit of ₹ 1,097.57 lakhs showing a growth of 95% year on year and consolidated net profit of ₹ 245.95 lakhs showing a growth of 154% year on year. year and consolidated net profit of ₹ 245.95 lakhs showing a growth of 154% year on year. We also like to inform you that we have reduced the cost of debt of Royal Orchid Hotels We also like to inform you that we have reduced the cost of debt of Royal Orchid Hotels Group by 1.6%, which will reduce finance cost of the Group considerably in the coming years. Group by 1.6%, which will reduce finance cost of the Group considerably in the coming years. In light of the aforementioned performance, the Board proposes to declare a final dividend In light of the aforementioned performance, the Board proposes to declare a final dividend of 15% to our fellow shareholders. We are successful in doing so after a span of 7 years of 15% to our fellow shareowners. We are successful in doing so after a span of 7 years barring the 10% interim dividend declared in the previous year. barring the 10% interim dividend declared in the previous year. We now aim to modernise our brand, stay in tune with times and provide exceptional We now aim to modernise our brand, stay in tune with times and provide exceptional service. Our vision is providing authentic hospitality by providing functional comforts service. Our vision is providing authentic hospitality by providing functional comforts making a difference in the lives of the people we touch every day, including our guests and making a difference in the lives of the people we touch every day, including our guests and associates we have across our hotels. We not only want to attract best talents but also associates we have across our hotels. We not only want to attract best talents but also nurture and groom talents to be entrepreneurs, thinkers and make a difference to nurture and groom talents to be entrepreneurs, thinkers and make a difference to hospitality as a sector. Our vision is to revamp the existing IT systems and process to hospitality as a sector. Our vision is to revamp the existing IT systems and process to support modernisation which is more system dependent than human dependent for support modernisation which is more system dependent than human dependent for optimum output. Our Marketing vision is to refresh our brand which connects to all optimum output. Our Marketing vision is to refresh our brand which connects to all sections of the society and appeals to various moods and needs of the new age travellers. sections of the society and appeals to various moods and needs of the new age travellers. With the middle class disposable income growing continuously over the years, its only With the middle class disposable income growing continuously over the years, its only important and imperative that we strategize based on the new age travellers. Therefore important and imperative that we strategize based on the new age travellers. Therefore our emphasis is on creating consumer pull by creative communication. Brand will be more our emphasis is on creating consumer pull by creative communication. Brand will be more youth and freshness focused with Innovation across all departments to be key focus. While youth and freshness focused with Innovation across all departments to be key focus. While Management of hotels has proved to be a successful business model, we will also focus on Management of hotels has proved to be a successful business model, we will also focus on leasing hotels as a growing business model. leasing hotels as a growing business model. Our Company thus in keeping with the growing tourism trend has a healthy balance sheet Our Company thus in keeping with the growing tourism trend has a healthy balance sheet as we undertake several new initiates like all new website, new technology partners for as we undertake several new initiates like all new website, new technology partners for enhanced business, new HR policies for talent retention and major renovation or inventory enhanced business, new HR policies for talent retention and major renovation or inventory upgrade across hotels to tune with the times. upgrade across hotels to tune with the times. Also would like to thank all shareholders, employees, partners in believing in us and helping Also would like to thank all shareowners, employees, partners in believing in us and helping us to deliver and retain our Brand promise which has resulted in outstanding deliveries and us to deliver and retain our Brand promise which has resulted in outstanding deliveries and financial results. We acknowledge all your participation and contributions in every way as financial results. We acknowledge all your participation and contributions in every way as we begin another year of making memories for both customers and stakeholders. we begin another year of making memories for both customers and stakeholders. Warm Regards Chander K. Baljee Managing Director Management Team Marketing & Communications Human Resources Engineering Information Technology BOARD OF DIRECTORS Managing Director - Mr. Chander K. Baljee Non-Executive Directors - Mr. Sunil Sikka Mrs. Sunita Baljee Independent Directors - Mr. Naveen Jain Dr. Vivek Mansingh - Ms. Lilian Jessie Paul (w.e.f. November 02, 2017) (Additional Director) Chief Financial Officer - Mr. Amit Jaiswal Company Secretary & Compliance Officer - Dr. Ranabir Sanyal Statutory Auditors - M/s. Deloitte Haskins & Sells LLP 17th Floor, Prestige Trade Tower 46, Palace Road, High Grounds Bengaluru - 560 001. Bankers - State Bank of India HDFC Bank Axis Bank Corporation Bank ICICI Bank Registered Office - No -1, Golf Avenue, Adjoining KGA Golf Course HAL Airport Road, Bengaluru, Karnataka- 560 008 Corporate Identity Number - L55101KA1986PLC007392 Registrar & Share Transfer Agent - Integrated Registry Management Services Private Limited 30, Ramana Residency, 4th Cross, Sampige Road, Malleswaram, Bengaluru – 560 003 CONTENTS Description Page No. Boards’ Report 2 Management Discussion and Analysis Report 29 Report on Corporate Governance 34 Auditors’ Report for Standalone Financial Statements 52 Balance Sheet - Standalone 56 Profit & Loss - Standalone 58 Statement of Changes in Equity - Standalone 59 Cash Flow Statement - Standalone 60 Notes to the Standalone Financial Statements 62 Auditors’ Report to Consolidated Financial Statements 101 Balance Sheet - Consolidated 104 Profit and Loss - Consolidated 105 Statement of Changes in Equity - Consolidated 106 Cash Flow Statement - Consolidated 107 Notes to the Consolidated Financial Statements 108 Notice 145 CAUTIONARY STATEMENT: Statements in this Annual report describing the company’s objectives, projections, estimates and expectations may be ‘forward looking statements’ within the meaning of applicable laws and regulations. Actual results might differ substantially or materially from those expressed or implied. Important developments that could affect the company’s operations include a downtrend in the hospitality sector, significant changes in political and economic environment in India or key financial markets abroad, tax laws, litigation, labour relations, exchange rate fluctuations, interest and other costs. Annual Report 2018 1 Royal Orchid Hotels Limited Boards’ Report Dear Members, The Board of Directors of your Company, with immense pleasure, present the Thirty Second Annual Report of your Company along with the Standalone and Consolidated Audited Balance Sheet, Statement of Profit and Loss, Cash Flow Statement, Statement of Changes in Equity and Notes to Financial Statements for the year ended 31 March 2018. Financial Performance The Company’s financial performance, for the financial year ended 31 March 2018 on standalone and consolidated basis is summarized below: (` in lakhs) As on 31 March 2018 As on 31 March 2017 Particulars Consolidated Standalone Consolidated Standalone Revenue from operations 18,945.35 10,214.02 17,487.22 9,272.53 Other Income 893.16 598.99 1,276.16 909.65 Total revenues 19,838.51 10,813.01 18,763.38 10,182.18 Food and Beverages Consumed 2,026.85 1,056.07 2,147.82 1,178.36 Employee