Kathmandu. City Hotel Limited, currently conducting a rights share auction, has been steadily reducing its losses and moving toward profitability. The company has implemented operational improvements, new business initiatives, and financial burden reduction measures, which are expected to positively impact its revenue and cash flow, according to its directors.
In recent years, City Hotel faced significant pressure to pay high bank interest. However, with ongoing corrective measures and expansion of new income sources, the company is on a path toward financial stability. The directors anticipate that using funds raised from the rights issue to repay bank loans will significantly reduce interest expenses, projecting a 30–35% decrease in upcoming quarters. The company paid NPR 264.3 million in interest during the last fiscal year.
To further strengthen profitability, City Hotel is preparing to launch a casino, along with a new gym and spa within the next two months. The Kathmandu-based hotel, located in Soltee Mode, was originally built at a cost of NPR 500 million, and constructing a comparable facility today is estimated to cost NPR 700–800 million.
The company is also exploring additional revenue streams, including leasing unused hotel spaces and providing accommodation and catering services to national and international football teams, which is expected to directly boost income.
In the hospitality sector, initial losses are common, and business success is measured by the reduction of deficits over time. Financial reports show that City Hotel’s losses have steadily declined since its operations began in 2078 BS: NPR 272.2 million in FY 2079–80, NPR 203.2 million in FY 2080–81, and NPR 192 million in the most recent fiscal year.
City Hotel operates the Hyatt Centric Hotel in Kathmandu, which rebranded from Hyatt Place two years ago.
The company has opened the sale of 2,150,418 unissued rights shares starting Kartik 23, including 1,989,999 shares from the founder group, 154,419 shares from the public group, and 6,000 shares for employees. The minimum price per share is set at NPR 100.
