City Hotel Limited is a company where the share price tells you almost nothing and the balance sheet tells you nearly everything. It built one expensive hotel with borrowed money, listed it, lost money every year since, and then asked its shareholders for Rs 1.34 billion more to pay the lenders back. The lenders got paid. The shareholders are still waiting for profits.
That is not a verdict on the stock. It is the factual shape of the business, and it is worth understanding piece by piece: what the company is, how its revenue moved, how profitable it is, how strong its cash and balance sheet are, what the market is charging for it, and what could go right or wrong from here.
What is City Hotel, really?
One building. City Hotel Limited, incorporated on December 5, 2007, owns a single five-star hotel property at Soalteemode, Kathmandu (registered address: Chinnalata Chowk, Kathmandu-13), which began commercial operations in November 2021, according to CARE Ratings Nepal's March 2026 rating report. The property has 153 rooms, including 3 suites and 7 rooms with sit-out terraces.
The hotel opened as a Hyatt Place and was converted to Hyatt Centric Soalteemode Kathmandu, debuting under the new brand in January 2025, the first Hyatt Centric property in Nepal. The company operates it under a Hotel Management Agreement with Hyatt International-South West Asia Limited, which is owned by Hyatt Hotels Corporation, a global operator with 20 brands and more than 1,200 properties across 70-plus countries as of end-2024. In plain terms: City Hotel owns the real estate and the business risk; Hyatt supplies the brand, the reservation system, and operating standards.
Revenue comes from rooms and lodging (about 59% of income in FY24), food, beverage and MICE (meetings, incentives, conferences, exhibitions, about 26%), plus banquets, the spa, and rental income. The company expanded banquet capacity from 400 to 600 guests, per its 2025 rights-issue prospectus. Casino space inside the property was contracted to an outside operator, though regulatory permission was still being processed when the prospectus was published. CARE's March 2026 report still describes an onsite casino as a prospective addition expected to diversify non-room revenue.
City Hotel belongs to the Golyan Group, a diversified Nepali business house with interests spanning manufacturing, hydroelectricity, international trade and services, banking, insurance, real estate, textiles, hospitality, and energy, according to CARE Ratings Nepal. The chairman is Mr. Shakti Kumar Golyan, described by CARE as a director of the Golyan Group of industries with wide experience across business sectors. The managing director is Mr. Akshay Golyan, with nearly a decade of experience in manufacturing and real estate, who also serves as managing director of Reliance Spinning Mills Limited and as a director of Westar Properties Limited.
On ownership, promoters hold 90.0% and the public 10.0% (as of August 11, 2025, per Capital Max). The largest shareholders, recorded before the rights issue (as of July 16, 2025): Shakti Kumar Golyan 29.14%, Kumud Golyan 20.09%, Akshay Golyan 16.99%, Surabhi Golyan 16.22%, Basu Dev Golyan 6.01%, and Kamlesh Kumar Agrawal 1.19%. The company raised Rs 167.40 million through its 2023 IPO (10% of capital, at Rs 100 per share) before listing on NEPSE on June 8, 2023. The rights allotment saw 11,241,582 shares taken up by 49,185 applicants with 1,950,418 shares (14.78%) initially unclaimed, which can shift the split at the margin.
One structural point matters more than names: CARE notes the company has repeatedly depended on timely financial support from its promoters to meet obligations, and considers continued promoter backing a key rating sensitivity going forward. The Golyan Group's resourcefulness is explicitly listed as a rating strength. Read plainly, this is a company whose credit profile still leans on its owners.
How did the revenue move?
The operating trend is stable but uninspiring. CARE Ratings Nepal's audited figures tell the story compactly (Rs in millions):
| Particulars | FY 2080/81 (audited) | FY 2081/82 (audited) | H1 FY 2082/83 (unaudited) |
|---|---|---|---|
| Income from operations (Rs Mn) | 582.00 | 522.00 | 244.00 |
| PBILDT margin (%) | 35.17 | 29.00 | 22.01 |
| Overall gearing (times)* | 4.10 | 4.37 | 1.07 |
| Interest coverage (times) | 0.63 | 0.57 | 0.52 |
| Total debt / gross cash accruals | Negative | Negative | Negative |
*Overall gearing excludes loans from promoters, per CARE. FY refers to the twelve months ending mid-July; H1 is the six months ending mid-January.
Operating income actually fell 10.31% in FY 2081/82, to Rs 522.00 million from Rs 582.00 million, which CARE attributes mainly to lower rental income, even as occupancy held fairly steady at around 55-60%. The single-property structure is the first thing to internalize: every swing in this story, from revenue to tourist arrivals to a bad quarter in Kathmandu, runs through one building.
How profitable is the hotel?
The bottom line is red in every period on record. The PBILDT margin (CARE's operating-profit measure, before interest, lease, depreciation and tax) compressed from 35.17% to 29.00% and then to 22.01% in H1 FY 2082/83. Interest coverage has never reached 1.00x in any of these periods: operating profit has not covered the interest bill once.
The reported net losses: Rs 203.20 million in FY 2080/81, Rs 198.96 million in FY 2081/82 (a 2.10% narrowing, per ShareSansar), and Rs 173.09 million in FY 2082/83 (announced August 14, 2026), a 13.00% improvement year on year. The direction is right; the sign is still negative.
The most recent detailed quarter, Q2 FY 2082/83 (quarter ended mid-January 2026), shows where the deleveraging is biting: revenue from operations Rs 232.40 million, total expenses Rs 190.23 million, finance cost Rs 102.61 million (down 28.19% from Rs 142.89 million a year earlier), and a net loss of Rs 100.94 million versus Rs 104.97 million in the same quarter last year, per ShareSansar's quarterly table. The interest bill is finally shrinking. It is still the single largest line item between the company and profitability.
How strong is the cash and the balance sheet?
This is the chapter where the story genuinely improved. In October 2025 the company completed an 80% rights issue (1:0.8): 13,392,000 shares at Rs 100 each, worth Rs 1,339.20 million, with the stated purpose of repaying loans. Pre-rights paid-up capital was Rs 1,674.00 million; post-rights it stands at Rs 3,013.20 million, and the right shares listed on NEPSE on December 11, 2025.
The effect on leverage is dramatic. CARE's rated long-term bank facilities dropped to Rs 2,500.06 million from Rs 3,289.93 million (short-term facilities steady at Rs 80.00 million), and overall gearing improved to 1.07x at mid-January 2026 from 4.37x at mid-July 2025. The company held cash of Rs 156.00 million plus liquid investments of about Rs 50.00 million in January 2026. In March 2026, CARE revised the issuer rating up to CARE-NP BB (Is) from BB- (Is) and the long-term bank facilities to CARE-NP BB from BB-, citing the improved financial risk profile after the rights issue. Total rated facilities now stand at Rs 2,580.06 million, down 23.44% from Rs 3,369.93 million.
Keep the improvement in proportion. Gearing of 1.07x is far healthier than 4.37x, but interest coverage is still 0.52x and total debt to gross cash accruals is still negative, which is CARE's polite way of saying cash accruals do not cover the debt. The patient is out of intensive care; it has not left the hospital.
What is the market charging for CITY?
As of September 28, 2026, CITY last traded at Rs 343.00 (down Rs 10.50, or 2.97%, on turnover of Rs 25.65 million), for a market capitalization of Rs 10,335.28 million (Rs 10.34 arba), per ShareHub Nepal's quote page. The 52-week range is Rs 327.20 to Rs 590.70, so the stock sits about 41.93% below its one-year high and 4.83% above its one-year low; the one-year yield is -41.07%. (Capital Max, on an unadjusted price series, prints a 52-week high of Rs 636.10.) The all-time high of Rs 1,168.50 dates to August 2024, a reminder of how violently sentiment has swung around this name.
On multiples: the reported P/E of -59.76 is mechanically computed off a negative EPS of Rs -5.74 and is not economically meaningful, so it should be ignored for valuation. The price-to-book of 3.57x (book value Rs 96.13 per share) is the operative multiple: the market values each rupee of net worth at Rs 3.57.
A rough enterprise-value sketch, stated with its assumptions: net worth at mid-January 2026 was Rs 2,969.03 million (paid-up Rs 3,013.20 million plus other equity of Rs -44.17 million, per the Q2 FY 2082/83 filing). Applying CARE's 1.07x gearing (which excludes promoter loans) implies debt of about Rs 3,176.86 million. Enterprise value is then roughly Rs 10,335.28 million (market cap) + Rs 3,176.86 million (debt) - Rs 206.00 million (cash and liquid investments), or about Rs 13,306.14 million. Against FY 2081/82 operating income of Rs 522.00 million, that is an EV/revenue multiple of about 25.49x; against annualized H1 FY 2082/83 revenue, about 27.27x. These are illustrative, not precise: they mix a September market price with January balance-sheet figures. But the order of magnitude is the point. The market is pricing this company at roughly twenty-five times its current revenue, which only makes sense if you believe revenue and margins expand materially from here.
What could go right, and what could go wrong?
Risks. Leverage is lower but the debt-service math is still tight: interest coverage below 1.00x, floating-rate exposure, and dependence on promoter support. The business is one building in one city, exposed to Kathmandu's intense hotel competition and to tourism cyclicality; the September 2025 Gen-Z protests and curfew cut tourist arrivals about 18% year-on-year that month, a live demonstration of how fast demand can wobble. The company has never reported an annual profit since listing, and accumulated losses sit in other equity at Rs -44.17 million.
Catalysts. The rights-issue deleveraging is real and already recognized by the rating upgrade; finance costs fell 28.19% year-on-year in the latest quarter. The Hyatt Centric rebrand positions the property in the upscale lifestyle segment, the 600-guest banquet expansion targets the MICE market, and a casino would add high-margin non-room revenue if regulatory permission lands. Tourist arrivals reached 1.158 million in calendar 2025, essentially back at pre-pandemic levels, and the FY26 budget granted tax exemptions to hotels and resorts. The annual loss has narrowed two years running, from Rs 203.20 million to Rs 198.96 million to Rs 173.09 million.
The listed-hotel peer contrast sharpens the question. For FY 2024/25, Nepal's listed hotels diverged sharply, per Tourism Mail's sector roundup: Soaltee Hotel earned Rs 670.70 million (+11.78%), Taragaon Regency (Hyatt Regency) earned Rs 515.40 million, Chandragiri Hills earned Rs 210.90 million (+5.46%), Kalinchowk Darshan earned Rs 26.80 million, and Oriental Hotels' profit collapsed 76% to Rs 29.50 million on weaker room and banquet revenue. City Hotel lost Rs 198.96 million, the sector's largest loss. The profitable listed hotels are older, established properties with settled capital structures; City Hotel is a young, still-stabilizing asset carrying the financing cost of its own construction. Its path to profit runs through operations: fill the rooms at better rates, grow the banquet and MICE business, add the casino, and let the lighter post-rights balance sheet convert operating profit into net profit.
What is the honest takeaway?
City Hotel fixed its balance sheet before it fixed its income statement. Whether the current valuation, about 3.57 times book and twenty-five times revenue, is justified depends entirely on whether the operating turnaround that the deleveraging bought time for actually arrives.
A note on what is verified here. Every figure above comes from a named public source: CARE Ratings Nepal's March 2026 and February 2025 rating reports, the company's 2025 rights prospectus, ShareSansar's quarterly filings coverage, Tourism Mail, ShareHub Nepal's quote page, Capital Max's company page (board, management, and shareholding as displayed on September 28, 2026), and Nepal Tourism Board arrival data via Himalaya Times. The statutory auditor's qualifications were not independently verified from the latest annual report for this piece.
This article is published for research and education purposes only. It is not investment advice, and nothing here should be read as a recommendation to buy, sell, or hold any security. Figures reflect publicly reported information at the time of writing; quarterly figures are unaudited and annual figures may be restated. Valuation sketches are illustrative. Always read the company's own filings and consult a licensed advisor before investing.
Frequently asked questions
What does City Hotel Limited own?
A single five-star property: the 153-room Hyatt Centric Soalteemode Kathmandu, including 3 suites and 7 rooms with sit-out terraces. The hotel opened as a Hyatt Place, was converted to the Hyatt Centric brand in January 2025 (the first Hyatt Centric in Nepal), and is run under a hotel management agreement with Hyatt.
Is City Hotel (NEPSE: CITY) profitable?
No. The company has reported a net loss in every fiscal year since listing on NEPSE in June 2023: Rs 203.20 million in FY 2080/81, Rs 198.96 million in FY 2081/82, and Rs 173.09 million in FY 2082/83. The loss is narrowing, but interest coverage has never reached 1.00x, which means operating profit has not covered the interest bill in any of these periods.
What did City Hotel's 80% rights issue achieve?
Completed in October 2025, the 1:0.8 rights issue (13,392,000 shares at Rs 100 each) raised up to Rs 1,339.20 million, earmarked for loan repayment. Rated long-term bank facilities fell to Rs 2,500.06 million from Rs 3,289.93 million, overall gearing improved to 1.07x from 4.37x, and CARE Ratings Nepal upgraded the company to CARE-NP BB in March 2026.
Who owns City Hotel Limited?
The Golyan Group promoter group holds 90.0% of the shares and the public holds 10.0% (as of August 2025). The largest pre-rights shareholders were Shakti Kumar Golyan (29.14%), Kumud Golyan (20.09%), and Akshay Golyan (16.99%). CARE Ratings notes the company has repeatedly depended on timely promoter support to meet its obligations.
Does CITY pay dividends?
No dividends have been declared since the company's NEPSE listing in June 2023.
What is CITY's share price and valuation?
On September 28, 2026, CITY last traded at Rs 343.00, for a market capitalization of Rs 10.34 arba. The price-to-book ratio is 3.57x on a book value of Rs 96.13 per share. The reported P/E of -59.76 is computed off a negative EPS of Rs -5.74 and is not economically meaningful for valuation.