Press Release December 23, 2025 VATIKA HOTELS PRIVATE LIMITED Rating Assigned

Product	Quantum (Rs. Cr)	Long Term Rating	Short Term Rating
Bank Loan Ratings	700.00	ACUITE BBB | Stable | Assigned	-
Total Outstanding	700.00	-	-
Total Withdrawn	0.00	-	-

Rating Rationale

­Acuite has assigned its long-term rating to 'ACUITE BBB' (read as ACUITE triple B) on the Rs. 700 Cr. bank facilities of Vatika Hotels Private Limited (VHPL). The Outlook is 'Stable'. Rationale for Rating The assigned rating reflects the company's established operational track record and the management's extensive experience, having successfully managed two five-star hotels for over a decade. The rating draws additional comfort from the long-term (25-year) agreement with Marriott International Group, under which both hotels operate as Westin-branded properties. The rating also incorporates the year-on-year increase in Average Room Rate (ARR) and occupancy, reflecting improved scale of operations and profitability. The company has a history of multiple refinances with various NBFCs, financial distress during the pandemic, and subsequently high-cost debt with Edelweiss ARC and NCDs from Edelweiss fund. The company plans to refinance its entire debt, which should lower finance costs and extend repayment tenure. Further, in April 2022, Vatika Hotels Private Limited de-merged its facility management and business centre verticals into its two separate fully owned subsidiaries through Business Transfer Agreement (BTA) i.e. Enviro Integrated Facility Services Private Limited and Vatika Business Centre Private Limited. As per BTA, the arrangement follows as the subsidiaries pay interest income are channelled to the holding company i.e. Vatika Hotels Private Limited, which records this amount as other income. Vatika Hotels uses these funds to further pay their own high interest-bearing debt obligations. However, timely refinancing of the debt will remain a key monitorable in the near to medium term. However, the rating is constrained with moderate financial risk profile along with demand risk and presence in a highly competitive industry.

About the Company

New Delhi based, Vatika Hotels Private Limited was incorporated in 2004. Vatika Hotels Private Limited is a subsidiary of Walif Developers Private Limited. The company is currently managing two five-star hotels under The Westin brand owned by Marriott International. The company is managed by Mr. Naveen Bakshi and Mr. Gaurav Bhala as directors.

Unsupported Rating

­Not Applicable.

Analytical Approach

­Acuite has considered the standalone business & financial risk profile of Vatika Hotels Private Limited (VHPL) to arrive at the rating.

Key Rating Drivers

Strengths

Established track record of operations along with experienced management The Westin brand already have a well-established presence in the hospitality industry. The company is headed by Mr. Gaurav Bhala, the Managing Director, who brings nearly two deacdes of overall experience in hospitality, real estate and facility management busniess ventures. Both hotels enjoys a significant locational advantage, situated at the heart of Gurgaon, Harayana with excellent access to major transit routes, including the Delhi International Airport, Delhi-Mumbai Vadodara Expressway, and NH-8. Acuite beleives that company will able to sustain the business risk profile in near to medium term on account of long term tied with Mariott International.  Improving scale of operations & Profitability The company generated net revenue of Rs. 323.67 cr. in FY 25 against Rs. 289.6 cr. in FY 24 which was increased from Rs. 251.38 cr. in FY 23. The company’s operations are improving year on year mainly due to improving occupancy level (%), Average Room Rent, and Rev Par per room. The company’s operating margin rose from 40.45% in FY 24 against Rs. 42.74% in FY 25. In absolute terms, the EBITDA improved to Rs. 138.32 cr. in FY 25 against Rs. 117.14 cr. in FY 24. The net profit improved from Rs. 14.10 cr. in FY 24 to Rs. 50.23 cr. in FY 25 supported by interest income from its own subsidiaries as per the aggreement.

Weaknesses

­Moderate Financial Risk Profile The financial risk profile of the company is moderate marked by net worth, gearing & ISCR. The tangible net worth of the company has improved from Rs. 170.94 cr. in FY 24 to Rs. 221.19 cr. in FY 25 mainly due to accreting of net profits into reserves. The gearing ratio improved & stood at 2.93 times in FY 25 against 4.03 times in FY 24. Similarly, the TOL/TNW improved & stood at 3.47 times in FY 25 against 4.56 times in FY 24. Interest coverage Ratio stood at 1.45 times for FY 25 against 1.26 times in FY 24. Debt-EBITDA & ROCE stood at 3.46 times & 19.51% respectively for FY 25. Further, the company has extended substantial loans and advances to group entities in the past. While a small portion of these loans is being recovered year on year , further recovery of the same in near to medium term will improve the cashflow of the company. Timely recovery of these loans & advances will be a monitorable in near to medium term. Although, any delay in the recovery of this amount may not impact the repayment obligation of the company, since the it will be solely based on the operating cashflows of the hotel business. Acuite believes going forward the financial risk profile of the company will improve on the account of steady accruals and expected re-financing of debt. Exposure to a Competitive and Cyclical Industry Environment The Indian hospitality industry is highly competitive, with many organised and unorganised players operating across various regions. The sector is inherently cyclical and remains vulnerable to economic fluctuations and seasonal demand variations. The low entry barriers have led to increased competition from both established and upcoming hotels, which may pose challenges to company's market positioning and operational performance. However, the medium-term outlook for the industry remains positive, supported by anticipated growth in commercial activity, tourism, and rising disposable incomes.

ESG Factors Relevant for Rating

­The hotel industry is increasingly adopting Environmental, Social, and Governance (ESG) principles as a strategic imperative, driven by growing traveler and investor demand for sustainability. Environmentaly, hotels focus on reducing their significant carbon footprint through energy and water efficiency, waste minimization (especialy single-use plastics), and sustainable sourcing. Socialy, efforts concentrate on responsible labor practices, promoting diversity and inclusion, supporting local communities through sourcing and engagement, and combating human trafficking. Governance involves maintaining transparent reporting, ethical leadership, and strong risk management. Embracing ESG creates long-term value, enhances brand reputation, and ensures operational resilience.

Rating Sensitivities

­Timely refinancing of outstanding debt.  Movement in the scale of operations & profitability

Liquidity Position

Adequate

The liquidity position is adequate as company made pre-payment of their principal debt obligation till 30th September 2026 from their operating cash flows & internal accruals. The current ratio stood at 1.60 times for FY 25. The company has a cash & bank balance of Rs. 11.54 cr. as on 31st March 2025. Acuite believes going forward the liquidity position of the company will improve on the account of steady accruals.

Outlook - Stable

­

Other Factors affecting Rating

­None.

Key Financials

Particulars	Unit	FY 25 (Actual)	FY 24 (Actual)
Operating Income	Rs. Cr.	323.67	289.58
PAT	Rs. Cr.	50.23	14.10
PAT Margin	(%)	15.52	4.87
Total Debt/Tangible Net Worth	Times	2.93	4.10
PBDIT/Interest	Times	1.45	1.26

Status of non-cooperation with previous CRA (if applicable)

­None.

Any other information

­None.

Applicable Criteria

• Default Recognition :- https://www.acuite.in/view-rating-criteria-52.htm • Service Sector: https://www.acuite.in/view-rating-criteria-50.htm • Application Of Financial Ratios And Adjustments: https://www.acuite.in/view-rating-criteria-53.htm

Note on complexity levels of the rated instrument

­In order to inform the investors about complexity of instruments, Acuité has categorized such instruments in three levels: Simple, Complex and Highly Complex. Acuite’s categorisation of the instruments across the three categories is based on factors like variability of the returns to the investors, uncertainty in cash flow patterns, number of counterparties and general understanding of the instrument by the market. It has to be understood that complexity is different from credit risk and even an instrument categorized as 'Simple' can carry high levels of risk. For more details, please refer Rating Criteria “Complexity Level Of Financial Instruments” on www.acuite.in.

Rating History :

­Not Applicable.

Annexure - Details of instruments rated

Lender’s Name ISIN Facilities Date Of Issuance Coupon Rate Maturity Date Quantum (Rs. Cr.) Complexity Level Rating Not Applicable Not avl. / Not appl. Proposed Long Term Bank Facility Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 700.00 Simple ACUITE BBB | Stable | Assigned

Contacts

Mohit Jain Chief Analytical Officer - Rating Operations Kartik Arora Senior Analyst - Rating Operations	Contact details exclusively for investors and lenders Mob: +91 8591310146 Email ID: analyticalsupport@acuite.in

About Acuité Ratings & Research

Acuité is a full-service Credit Rating Agency registered with the Securities & Exchange Board of India (SEBI). The company received RBI Accreditation as an External Credit Assessment Institution (ECAI) for Bank Loan Ratings under BASEL-II norms in the year 2012. Acuité has assigned ratings to various securities, debt instruments and bank facilities of entities spread across the country and across a wide cross section of industries. It has its Registered and Head Office in Kanjurmarg, Mumbai. Disclaimer: An Acuité rating does not constitute an audit of the rated entity and should not be treated as a recommendation or opinion that is intended to substitute for a financial adviser's or investor's independent assessment of whether to buy, sell or hold any security. Ratings assigned by Acuité are based on the data and information provided by the issuer and obtained from other reliable sources. Although reasonable care has been taken to ensure that the data and information is true, Acuité, in particular, makes no representation or warranty, expressed or implied with respect to the adequacy, accuracy or completeness of the information relied upon. Acuité is not responsible for any errors or omissions and especially states that it has no financial liability whatsoever for any direct, indirect or consequential loss of any kind, arising from the use of its ratings. Ratings assigned by Acuité are subject to a process of surveillance which may lead to a revision in ratings as and when the circumstances so warrant. Please visit our website (www.acuite.in) for the latest information on any instrument rated by Acuité. Please visit https://www.acuite.in/faqs.htm to refer FAQs on Credit Rating. Note: None of the Directors on the Board of Acuité Ratings & Research Limited are members of any rating committee and therefore do not participate in discussions regarding the rating of any entity.