Ventive margin drops 5.38 points as costs outpace revenue
Revenue grew 6.97% year on year, but expenses rose 16.71%; reported profit also reflects other income at 16.53% of pre-tax profit.
Filed 04 Aug 2026, 20:43 IST · after market close · Ventive Hospitality Ltd (VENTIVE)
Key takeaways
- Consolidated operating margin fell 5.38 percentage points year on year to 35.56% as expenses grew 16.71% against 6.97% revenue growth.
- Reported net profit rose 227.48% year on year to Rs 124.18 cr despite a 23.70% decline in profit before tax, with other income equal to 16.53% of pre-tax profit.
- Revenue fell 30.30% sequentially and operating margin dropped 13.91 percentage points from Q4FY26, reversing the margin recovery seen in the previous two quarters.
Price around the results
Year-on-year growth came with weaker operating conversion
Consolidated revenue increased 6.97% year on year, but operating profit declined 7.09% because expenses grew 16.71%. That mismatch narrowed operating margin by 5.38 percentage points to 35.56%. The margin remains 22.26 percentage points above the 13.30% median for 80 Consumer Discretionary peers that have reported the quarter.
Sequential slowdown erased the recent margin recovery
Revenue fell 30.30% from Q4FY26, while expenses declined only 11.12%, so operating margin contracted by 13.91 percentage points. This reversed the improvement from 38.75% in Q2FY26 to 45.37% in Q3FY26 and 49.47% in Q4FY26; the current 35.56% is below each of those three quarters. Interest expense was broadly stable sequentially, down 2.21%, while depreciation increased 6.33%.
Profit quality needs to be read with other income and tax
Other income fell 18.63% year on year and 88.25% sequentially, but still represented 16.53% of pre-tax profit. The tax rate rose to 64.19% from 52.77% a year earlier and 22.32% in Q4FY26. Reported net profit nevertheless increased 227.48% year on year, while sequential net profit declined 52.10%.
Presentation points to a larger hotel pipeline
Management said Ventive has more than 1,700 keys under development, including more than 1,500 keys across eight upcoming hotels. The company said the Sahyadri Hills acquisition was completed in July 2026 and that the project had received its occupancy certificate. Management also said Raaya is expected to operate generator-free for 17 hours a day, with more than 80% of operations using solar power.
No market reaction yet; past result moves have skewed negative
The results were filed after market close, so there was no immediate stock reaction in the reported period. Across the last six results, the stock rose twice and fell four times, with a median absolute move of 1.60%. The prior moves ranged from -6.48% to +1.60%, putting the historical pattern on the negative side without implying a response to this release.
Q1FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹543 cr | ₹779 cr | -30.30% | +6.97% |
| Other income | ₹10 cr | ₹86 cr | -88.25% | -18.63% |
| Expenses | ₹350 cr | ₹394 cr | -11.12% | +16.71% |
| Operating profit | ₹193 cr | ₹385 cr | -49.89% | -7.09% |
| Operating margin (%) | 35.56% | 49.47% | — | — |
| Interest | ₹52 cr | ₹53 cr | -2.21% | -13.10% |
| Depreciation | ₹90 cr | ₹84 cr | +6.33% | +12.32% |
| Profit before tax | ₹61 cr | ₹334 cr | -81.64% | -23.70% |
| Tax | ₹39 cr | ₹74 cr | -47.20% | -7.17% |
| Net profit | ₹124 cr | ₹259 cr | -52.10% | +227.48% |
| EPS (₹) | ₹3.46 | ₹9.83 | -64.80% | +200.87% |
Operating margin of 35.56% compares with a Consumer Discretionary sector median of 13.30% across 80 peers that have reported Q1FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- The Sahyadri Hills acquisition was completed in July 2026 and its occupancy certificate was received.
Guidance & outlook
- Raaya is expected to run generator-free for 17 hours a day and use solar for more than 80% of operations.
Expansion
- Ventive has more than 1,700 keys under development across its pipeline.
- The company lists more than 1,500 keys across eight upcoming hotels.
- The Sahyadri Hills acquisition was completed in July 2026 and the project has received its occupancy certificate.
What to watch
- Whether consolidated operating margin recovers from 35.56% after the 13.91-percentage-point sequential decline.
- Whether other income remains a material contributor after accounting for 16.53% of pre-tax profit.
- Progress in the more than 1,700-key development pipeline and the eight upcoming hotels cited by management.