THE ROYAL HOTEL, LIMITED
9713・Standard Market・Services
Business
Royal Hotel Co., Ltd. is a long-established hotel company founded in 1932 that directly operates and manages nine hotels centered on the "Rihga Royal" brand in Osaka, Tokyo, Hiroshima, Kokura, Kyoto, and other locations. The group is composed of the Company and seven consolidated subsidiaries, with full-service city hotels—balancing accommodation, banquets, and restaurants—as its core business. In 2023, the company sold the land and building of the Rihga Royal Hotel (Osaka) and shifted toward an asset-light model. In October 2025, it made Shiba Park Hotel (comprising two hotels, Shiba Park Hotel and Park Hotel Tokyo, with 466 rooms) a wholly owned subsidiary, adding to the group a high-occupancy hotel with a 95% inbound ratio and a customer base centered on North America, Europe, and Australia. The company plans to open seven new hotels from April 2026 onward and is in a growth phase aiming for a 35-hotel network by 2035.
Business Model
Revenue of ¥29,273 million breaks down into rooms ¥13,156 million (45%), banquets ¥5,534 million (19%), dining ¥4,010 million (14%), and other ¥6,571 million (22%), diversified across multiple segments. New store openings adopt an accommodation-focused model with initial investment of just over ¥300 million, variable rent, and reduced staffing (approximately 20 employees), aiming for higher profit margins than existing full-service hotels. Rihga Royal Hotel (Osaka) operates under a management contract format without holding assets, promoting asset-light management.
Company Strengths
The company has a long-standing customer base dating back to its founding in 1932 and the opening of the Osaka Royal Hotel in 1965. Its membership organization, "Rihga Members," surpassed 550,000 members in March 2026. Membership continues to grow at a pace of 100,000 new members per year, forming a proprietary customer asset that promotes repeat visits and touring among domestic individual customers.
Room rates at the Rihga Royal Hotel Osaka rose significantly after it joined IHG's "Vignette Collection." The Shiba Park Hotel group (466 rooms) has maintained a stable average occupancy rate in the 80% range, with an inbound ratio of 95% and a customer base centered on North American, European, and Australian guests, representing a high-value-added customer composition. These are proprietary competitive assets acquired through the company's strategic M&A activities and partnerships.
The sale of the Rihga Royal Hotel (Osaka) land and building in March 2023 fundamentally improved the company's finances. As of the end of FY2026 (ending March 2026), the equity ratio stood at 60.6%, net assets at ¥23,851 million, debt redemption period at 0.2 years, and interest coverage ratio at 263.1 times, indicating extremely high financial soundness. The company has established a structure that allows it to fund new store investments from retained earnings.
ENVALITH's Perspective
Performance Trend
Revenue expanded approximately 1.8x over four periods, from ¥16,465 million in FY2022 (ended March 2022) to ¥29,273 million in FY2026 (ending March 2026). Operating profit continued its turnaround and expansion, moving from an operating loss of ¥8,217 million in FY2022 (ended March 2022) to operating profit of ¥1,162 million in FY2026 (ending March 2026). The main driver of the revenue increase in FY2026 (ending March 2026) (+¥4,109 million) was the consolidation of Shiba Park Hotel as a subsidiary (effective November 29, 2024), with room division sales growing sharply by +27.8% year on year (+¥2,861 million). While external factors such as the increase in inbound demand and improvement in the employment and income environment have provided tailwinds, rising raw material costs, utility costs, and personnel expenses have constrained improvement in profit margins. The operating profit margin showed only a moderate improvement to 4.0% (from 3.6% in the previous period).
Growth Strategy
The company aims to achieve a 35-hotel structure by 2035 through three pillars: brand reorganization, value-up of existing hotels, and expansion of new store openings.
Reorganizing categories by grade and style to expand brand variations. Established a new lodging-focused store opening model (initial investment of just over ¥300 million, projected sales of approximately ¥1.4 billion, operating profit of approximately ¥100 million, operated by around 20 staff) and secured over 400 inquiries in FY2025. The company targets opening 10 hotels by 2030 and 20 hotels by 2035, aiming for a 35-hotel structure.
Rihga Royal Hotel Osaka joined IHG's "Vignette Collection" in April 2025 and reopened after renovation, resulting in a marked increase in room rates. The company was commissioned to operate the state guest house for Expo 2025 Osaka, Kansai, enhancing brand value. Large-scale renovations of Rihga Royal Hotel Tokyo and Hiroshima are also under consideration. DX is being promoted through the rollout of an AI revenue management system and new PMS at all hotels (targeted for completion by end of September 2026).
Plans to open 7 hotels from April 2026 onward (Rihga Royal Resort Okinawa Chatan, Ankored Osaka Namba, Bouncy Fukuoka Hakata, Rihga Grand Hiroshima, Nowa Kobe Arima, Okinawa Nakijin, and Rihga Grand Chitose). Through the full consolidation of Shiba Park Hotel as a wholly owned subsidiary (October 2025), the company acquired a Tokyo base and a sales network for inbound customers from Europe and the Americas, and aims to pursue synergies through integrated group management.
Integrating the sales networks of Rihga Royal, which is strong in East Asia, with Shiba Park Hotel, which is strong in North America and Europe. Newly signed outsourcing agreements with 3 REP (sales representative) companies targeting the South Korean, Taiwanese, European, and North American markets. Participation in overseas exhibitions and business meetings increased by 9 events year-on-year. The company is developing an English-language version of the Rihga Members app, aiming to reach 1 million members by 2030.
Last updated: July 19, 2026