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In FY23, Bloom Hotels achieves profitability with a revenue of Rs 144 Cr

Although Bloom Hotels is a hospitality chain that was founded 13 years ago, its popularity has grown recently. The mid-segment hotel brand continued on its current growth trajectory, growing by approximately three times before turning a profit in the fiscal year that ended in March 2023.


From Rs 49 crore in FY22 to Rs 144 crore in FY23, Bloom Hotels' operating revenue increased 2.93 times, according to its standalone financial statements that were submitted to the Registrar of Companies.


The organization oversees a variety of lodging establishments, including Bloom Hotel, Bloom Hub, BloomSuites, and Bloomrooms. At the moment, it has more than 50 hotels spread throughout Mumbai. Pune, Jaipur, NCR, Udaipur, and so forth.


Accommodation sales accounted for 83% of revenue in FY23, a 3X increase to Rs 119 crore. the remaining funds received from the sales of food, drink, and related services.


Rent and leasing expenses made up 30% of the hotel chain's total spending, which increased by 152.9% to Rs 43 crore in FY23 from Rs 17 crore in FY22. Its consumables and employee benefits increased by 143% and 81%, respectively, in the previous fiscal year.


With advertising, commissions, legal/professional fees, and other overheads, Bloom Hotels' total expenses rose from Rs 67 crore in FY22 to Rs 144 crore in FY23, a 115% increase.


Bloom Hotel's three-fold increase and cost-controlling measures enabled it to become profitable, generating a profit of Rs. 6 crore in FY23. In FY22, the company reported a loss of Rs 9 crore. At 3% and 8.6%, respectively, were its ROCE and EBITDA margin.


In FY23, it cost Re 1.00 to earn a rupee on a unit basis.


Treebo, FabHotels, and to some extent Oyo are competitors of Bloom Hotels. It's interesting to note that they have all recently become profitable or are almost profitable. To put things in perspective, Treebo reported earning Rs 89 crore and losing Rs 3.6 crore in the most recent fiscal year, while FabHotels recorded a surge in operating revenue to Rs 219 crore in FY23, despite only reporting a loss of Rs 5 crore. Oyo reported a two-fold quarter-over-quarter growth in its profit to Rs 30 crore in Q3 FY24. Oyo posted losses of Rs 1,286 crore and revenue of Rs 5,464 crore in FY23.


Bloom has taken great care to cultivate its reputation as a boutique but high-quality travel option. The chain has rarely pushed for or made promises where it might not be able to keep them, whether it is regarding the amenities provided or the selection of comparatively upscale locations. On the other hand, on a limited basis, the potential increased level of guest satisfaction can only go so far. As a result, the chain must expand without sacrificing quality—a challenge that all of its competitors have encountered at some point. Given a more precise and well-defined template, we think Bloom has a greater chance of succeeding than most. It appears highly probable that FY24 numbers will be strong for this chain, providing the foundation for growth to 100 properties at a later stage.

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