Bharat Hotels appears to be comfortably placed as far as its performance for the previous fiscal is concerned. However, the 24 per cent jump in net profit to Rs 39 crore during 1996-97 is mainly attributed to a 121 per cent rise in other income and a sharp fall in interest cost. While total income recorded a 22.37 per cent jump, net sales rose by only 15.83 per cent. Other income rose from Rs 5.16 crore to Rs 11.43 crore. OPM slipped from 42.25 to 42.14 per cent, while NPM improved to 43.12 per cent against 40.27 per cent. Despite a lower growth of 16 per cent in expenditure to Rs 52.32 crore, margins at operating level have slipped. As widely prevalent in the hospitality business, the company's major portion (56.22 per cent) of turnover for the full year was accounted for in the second-halfand the company recorded a net sales of Rs 50.86 crore as against Rs 90.45 crore for the full year.

The $19.5-million GDR issue (26 lakh shares of Rs 10 each), a bonus issue and amalgamation of Malbras Hotels with Bharat Hotels bloated its equity by 77 per cent to Rs 22.13 crore. Reserves shot up by 232 per cent to Rs 167.7 crore as a result of GDR issue. EPS on enhanced equity fell from Rs 25.15 to Rs 17.62. The fresh cash flow helped the company reduce its interest burden substantially to mere Rs 8 lakh. PBT jumped by 39 per cent to Rs 43.75 crore. However, MAT led to a cash outflow of Rs 4.75 crore. Although Bharat Hotels' performance has not been very impressive, the scrip gained Rs 3.5 in two trading sessions after the announcement of results.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.