Final Results

India Hospitality Corp. Reports Preliminary Fiscal Year 2008 Results 
 
                 Revenues Improve 43% over Prior-Year Period,  
        Kitchen Capacity Increased 55,000 Meals per Day in Fiscal 2008 
 
    LONDON, June 23 -- India Hospitality Corp. (LSE: IHC, IHC or India Hospitality)
today announced unaudited preliminary results for its operating businesses,
Mars Restaurants and SkyGourmet Catering, for the fiscal year ended March 31,
2008. 
 
    Fiscal year 2008 highlights: 
  
    -- Acquired Mars Restaurants Private Limited and SkyGourmet Catering 
Private Limited in July 2007 for $110 million. 
 
    -- Total revenues increased 42.8% on a year-over-year basis to $35.2 
million. 
 
    -- Received $75 million investment commitment in December 2007 from Navis 
Capital Partners and Hayground Cove Asset Management. 
 
    -- Opened 25,000 meals per day Air Catering Unit in Delhi in June 2007; 
opened new SkyGourmet kitchen in January 2008 in Chennai with a capacity of 
10,000 meals per day. 
 
    -- Launched new SkyGourmet kitchen in March 2008 in Hyderabad in 
conjunction with the opening of the city's new Rajiv Gandhi International 
Airport; Hyderabad kitchen capacity is 20,000 meals per day. 
 
 
    Subsequent Events: 
 
    -- On June 11, IHC's Board of Directors appointed Ravi Deol as Chairman 
and Chief Executive Officer of Mars Restaurants as part of a major initiative 
to rapidly grow its hotels and food services businesses. 
 
    -- On June 11, IHC announced the formation of a $200 million hospitality 
fund to be led by Mr. Deol.  The fund will allow the company to make a 
significant investment into the development and/or acquisition of Indian 
hospitality properties and will be managed by Mars Restaurants, which also 
owns Gordon House Hotels.  IHC will receive a management fee through an 
advisory agreement between the fund and Mars. 
 
    -- On June 16, IHC announced that its SkyGourmet division signed an air 
catering contract with Lufthansa for its flights to Frankfurt from Pune.  
Meals will initially be catered out of the Gordon House Hotel, which is 
operated by Mars Restaurants.  SkyGourmet has also started catering to 
Kingfisher out of Pune, and is in discussions with several international 
carriers.   
 
 
    "The Indian economy and hospitality industry has continued its rapid 
growth over the past year and a half, and with 35 new regional airports and 
four major metropolitan airports currently under construction in India, IHC is 
poised to capitalize on this changing environment in South Asia," said IHC 
Deputy Chairman Richard Foyston. "With the addition of our new $200 million 
hospitality fund, we believe IHC is in a strong position to take advantage of 
the opportunities that this growth will provide over the next several years." 
 
    Fiscal Year 2008 Preliminary Results 
    For the fiscal year ended March 31, 2008, India Hospitality reported 
unaudited revenue of $35.2 million from Mars and SkyGourmet - a 42.8% increase 
from the combined results for the prior-year period.  Top line growth was 
boosted by an approximate 62.9% increase in revenue from IHC's SkyGourmet 
division, aided by increased demand for meals, as well as the opening of a new 
kitchen in Chennai in January 2008 and a significant increase in capacity at 
the company's Delhi Air Catering Unit.  Total meals served for fiscal year 
2008 increased 58%.   
    Revenue at Mars Restaurants increased to $11.7 million, a 15.8% 
improvement over the prior-year period. The results at Mars were driven by a 
29% increase in average room revenue (ARR) at the Gordon House Hotels.   
Same-store sales increased 6.5% at Birdy's cake shops, while other restaurant 
same-store sales increased 12%. 
    Total combined adjusted EBITDA for SkyGourmet and Mars for fiscal year 
2008 was $6.8 million compared to $4.9 million in the prior-year period, a 37% 
improvement.  Margin pressure occurred in the first half of the fiscal year 
due to higher fixed costs associated with capacity additions at SkyGourmet.  
Also associated with these higher fixed costs, SG&A increased from $13.7 
million in fiscal 2007 to $18.6 million (adjusted) in fiscal 2008, primarily 
an investment in infrastructure to accommodate the anticipated growth at 
SkyGourmet over the next several years.  Revenue growth in the second half of 
the year has now resulted in more normalized margins.  
    Included in one-time adjustments to EBITDA were a $1.6 million loss on 
sale of assets - almost all from the sale of an obsolete kitchen at 
SkyGourmet, a $0.9 million set-up costs charge at SkyGourmet (pre-opening 
expense) and a $0.7 million charge at Mars for a one-time compensation expense 
in recognition of service.  Including all of these one-time items, EBITDA for 
SkyGourmet and Mars for fiscal year 2008 was $3.4 million. A detailed 
reconciliation table of these charges is included at the end of this 
announcement.  
 
    Liquidity and Balance Sheet 
    As of March 31, 2008, IHC has approximately $38 million in long-term debt 
on its balance sheet and $18 million of cash and cash equivalents - 
approximately $12 million of which is held at the IHC corporate level.  Key 
balance sheet metrics are included at the end of this announcement. 
 
    Long-Term Outlook 
    Looking at the long-term time horizon, SkyGourmet is projecting that with 
continued kitchen expansion, it will be able to increase its capacity of meals 
per day to over 150,000 by fiscal year 2012.  In addition, Gordon House has 
identified several opportunities for hotel acquisitions in New Delhi, Noida, 
Pune and Mumbai - all in moving toward a goal of eventually reaching 2,000 
hotel rooms through organic growth and acquisitions.  
 
    About India Hospitality Corp. 
    India Hospitality Corporation's mission is to acquire and successfully 
operate Indian businesses or assets in the hospitality, leisure, tourism, 
travel and related industries, including but not limited to hotels, resorts, 
timeshares, serviced apartments and restaurants. 
    IHC operates through two wholly owned subsidiaries, Mars Restaurants 
Private Limited - an emerging hotel and restaurant company - and SkyGourmet 
Catering Private Limited, a leading airline catering company.  The companies 
are headquartered in Mumbai and have over 1,700 employees across their 
facilities in India. 
 
    Deutsche Bank AG is IHC's nominated adviser and broker for the purposes of 
the AIM Rules for Companies.  Its responsibilities as IHC's nominated adviser 
and broker under the AIM Rules for Nominated Advisers are owed solely to 
London Stock Exchange plc and not to IHC, any director of IHC or any other 
person. 
    No offer or invitation to purchase or subscribe for ordinary shares in or 
warrants to purchase or subscribe for ordinary shares or warrants of IHC is 
being made by this announcement. 
 
 
 
                    Revenue and Adjusted EBITDA for the Periods Ended March 31 
     
    (in U.S. $mm)        Mars                                  
                      Restaurants      SkyGourmet      Combined *      
                     Fiscal Fiscal   Fiscal Fiscal   Fiscal Fiscal  Year/Year 
                      2007   2008     2007   2008     2007   2008     Change 
 
    Revenue          $10.1  $11.7    $16.5  $26.9    $24.6  $35.2     42.8% 
    Adjusted EBITDA   $0.3   $1.5     $4.6   $5.2     $4.9   $6.8     37.1% 
     
    * Combined revenue includes intercompany eliminations; adjusted EBITDA is  
      net of non-recurring items. 
 
 
 
                                   Adjustments to EBITDA 
     
      (in U.S. $mm) 
 
      Taxes for earlier years                                   $0.10 
      Loss on sale of assets/Set-up cost of assets              $2.50 
      Compensation charge in recognition of long-term   
       service                                                  $0.70 
      Consultancy charges                                       $0.05 
 
      Total                                                     $3.35 
 
 
                                  Key Balance Sheet Metrics 
     
                              Combined operating companies total 
 
        (in U.S. $mm)                   Fiscal 2007        Fiscal 2008 
 
        Cash & cash equivalents *             $0.8              $17.7 
        Total Assets                          56.7              100.4 
        Total Liabilities                     28.7               53.3 
        Shareholders Equity                   28.0               47.1 
        Long-Term Debt                        19.1               38.0 
 
        * Includes approximately $12 million held at the parent company. 
 
 
 
              Unaudited Income Statement for Operating Companies 
 
    (in US $000s)             FY 2007                  FY 2008 (adjusted)    
    Profit & Loss     SKY      MARS   Combined      SKY      MARS    Combined  
      
    Net Sales    $16,499.7 $10,072.5 $26,572.2  $26,859.7 $11,657.3 $38,516.9   
    COGS (cost of   
     materials)    5,420.9   3,490.0   8,910.9   10,310.3   3,711.5  14,021.9   
    Gross Profit  11,078.8   6,582.5  17,661.3   16,549.3   7,945.7  24,495.1   
      
    SG&A (including   
     depreciation) 8,305.6   7,356.4  15,662.0   13,883.0   7,645.4  21,528.4   
    SG&A (excluding   
     depreciation) 7,034.9   6,705.7  13,740.7   11,662.0   6,971.7  18,633.8   
    Operating   
     Income        2,773.2    (773.9)  1,999.3    2,666.4     300.3   2,966.7   
      
    Other Income     590.0     427.3   1,017.3      355.4     544.2     899.6   
    EBIT           3,363.3    (346.6)  3,016.6    3,021.7     844.5   3,866.2   
    Interest         644.6     658.1   1,302.7    1,958.8   1,060.8   3,019.6   
    Interest for  
     Office Purchase  
    EBT            2,718.7  (1,004.7)  1,713.9    1,062.9    (216.3)    846.6   
    Taxes (excluding   
     DT for 2004-05) 934.8      18.3     953.1      189.7     149.0     338.7   
    Net Income/  
     (Loss)        1,783.9  (1,023.1)    760.8     $873.2   ($365.2)    508.0   
      
    Other Information       
    Depreciation &   
     Amortization  1,270.7     650.7   1,921.4    2,220.9     673.7   2,894.6   
    EBITDA        $4,633.9    $304.1  $4,938.0   $5,242.7  $1,518.2  $6,760.9 
 
 
                                         Balance Sheet Data (unaudited) 
     
            (in US $000s)                    For Combined SKY and MARS 
                                               FY2007        FY2008 
            CURRENT ASSETS 
            Cash on Hand and at Banks            $818        $1,663 
            Short Term Investment                 -           3,982 
            Accounts Receivable-Net             5,679         9,166 
            Inventories                           342           519 
            Other Current Assets                5,068         2,685 
            Total Current Assets               11,907        18,015 
     
            Fixed Assets 
            Net PP&E                           32,137        67,263 
            Long-Term Investment                1,488         1,287 
            Other Fixed Assets                 11,080        13,775 
            Total Fixed Assets                 44,705        82,325 
            Intangible Assets                      72            54 
            Total Assets                      $56,683      $100,394 
     
            CURRENT LIABILITIES 
            Accounts Payable                   $7,585       $11,052 
            Other Current Liabilities           1,503         3,182 
            Total Current Liabilities           9,088        14,234 
     
            LT Liabilities 
            Long-term Debt                     19,108        38,022 
            Other Long-term Liabilities           511           998 
            Total LT Liabilities               19,619        39,020 
     
            Shareholders' Equity 
            Total Shareholders' Equity         27,977        47,139 
            Total Liabilities &           
             Shareholders' Equity             $56,683      $100,394 
 
 
 
    Cautionary note regarding forward-looking statements 
    This preliminary earnings announcement contains certain forward-looking 
statements with respect to the financial condition, results of operations and 
business of India Hospitality Corp. (the Company), and certain plans and 
objectives of the board of directors of the Company.  These forward-looking 
statements can be identified by the fact that they do not relate only to 
historical or current facts.  Forward-looking statements often use words such 
as "anticipate", "target", "expect", "estimate", "intend", "plan", "goal", 
"believe", "will", "may", "should", "would", "could" or other words of similar 
meaning.  These statements are based on assumptions and assessments made by 
the board of directors of the Company in light of their experience and their 
perception of historical trends, current conditions, expected future 
developments and other factors they believe appropriate.  By their nature, 
forward-looking statements involve risk and uncertainty, and the factors 
described in the context of such forward-looking statements in this 
announcement could cause actual results and developments to differ materially 
from those expressed in or implied by such forward-looking statements. 
    Should one or more of these risks or uncertainties materialize, or should 
underlying assumptions prove incorrect, actual results may vary materially 
from those described in this release.  India Hospitality Corp. assumes no 
obligation to update or correct the information contained in this release, 
whether as a result of new information, future events or otherwise, except to 
the extent legally required. 
    The statements contained in this announcement are made as at the date of 
this release, unless some other time is specified in relation to them, and 
service of this announcement shall not give rise to any implication that there 
has been no change in the facts set out in this announcement since such date.  
Nothing contained in this announcement shall be deemed to be a forecast, 
projection or estimate of the future financial performance of the Company 
except where expressly stated. 
 
SOURCE  India Hospitality Corp. 
    -0-                             06/23/2008 
    /CONTACT:  Media Contact: Mutual Image & Events Management Pvt. Ltd., 
Harsh Wardhan, [phone]; or Investor Relations Contact: ICR Inc., 
William Schmitt, [phone]; or Nominated Adviser and Broker: Deutsche 
Bank AG, Mumtaz Naseem, [phone]/