PREVIEW-EIH, Hotel Leela Oct-Dec net seen up on room rates

MUMBAI, Jan 29 (Reuters) - Hotel companies are expected to report strong growth in the three months to December on an average 15-25 percent rise in room rates across most cities except Bangalore, analysts said.

"This quarter is good for hotels. It is the tourist season and there is sustained growth in demand," said an analyst who declined to be named.

Hotel Leelaventure Ltd (HTLE.BO: Quote, Profile, Research) is seen posting a 29 percent rise in net profit to 460 million rupees, a Reuters poll of brokerages showed. Net sales are expected to grow 30.7 percent to 1.3 billion rupees.

Sales are expected to grow by a third year-on-year mainly on account of inventory addition of 105 rooms in Bangalore in Jan-Mar 2007, an IL&FS report said, adding average room rates and occupancy levels in Bangalore have declined in the last one year.

The company's margins could be impacted given the lower room rates and occupancies in Bangalore with room supply growing in the city, analysts said.

EIH Ltd (EIHO.BO: Quote, Profile, Research), which operates the Oberoi chain of hotels, is expected to see net profit rise by over a third to 848 million rupees, according to the poll. Net sales would grow by nearly a fifth to 3.1 billion rupees.

The company is expected to show improved performance due to strong growth in average room rates across Delhi and Mumbai, a B&K report said.

The hoteliers will report their results on Jan 30. (Reporting by Jasudha Kirpalani, Editing by Sunil Nair)