Tata controlled Indian Hotels Company on Thursday said its October-December 2011 net profit has

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increased by 8.7 per cent from a year ago to Rs 92.43 crore due to increase in its other income, lower tax and interest costs and higher sales revenues.

In the third quarter the company reported a 7.4 per cent year on year increase in its net sales to Rs 521.48 crore. The total expenditure of the company in October-December 2011 increased by 9.8 per cent from a year ago to Rs 407.29 crore. Himani Singh, an analyst at Elara Capital said, “The earnings are above expectation as given the present economic slowdown we expected sales and profits to be lower.”

“Foreign tourist arrivals in India grew at a slower rate of 8.8 per cent in 2011 as compared to 11.8 per cent in 2010. Domestic travellers in contrast rose 11 per cent in 2011. For the year 2012, international tourist arrivals are expected to grow between 3-4 per cent as compared to 4.4 per cent. In 2011 we opened several new Vivanta properties. 2012 will be the year of Gateway Hotels with several lined up for opening,” said Raymond N Bickson, managing director Indian Hotels Company. These hotels are coming up around two years later than expected as the economic slowdown in 2008 impacted the delivery plans of hotel owners who had contracted with IHCL.

In the third quarter the company’s provision for taxes declined 15 per cent from a year ago to Rs 27.14 crore. The company’s October-December 2011 other income increased by 169 per cent from a year ago to Rs 8.69 crore. “In the December quarter our focus was on driving occupancies while upholding average room rates across our properties by getting customers to extend stays etc,” said Deepa Misra Harris, senior vice president sales and marketing at Indian Hotels Company. In October-December 2011 the company’s staff cost was up 9.8 per cent from a year ago to Rs 124.55 crore. The company also reported a notional foreign exchange loss of Rs 6.81 crore.

“In financial year 2012-2013 we will have a hotel opening every three weeks or so as compared to one every four weeks in this financial year,” said Bickson.