Indian Hotels taps food, adds budget, luxury options at Coimbatore
The Indian Hotels Co. Ltd. is betting a growth in tourism will boost demand for budget and luxury properties, while also looking to expand on related areas such as convenience foods.The country's top operator and owner of the Taj chain of hotels is straddling a dual strategy of tapping budget travellers as well as well-heeled tourists with luxury resorts and palaces.
The Mumbai-based company has six budget Ginger hotels in the country - with an average room tariff of 999 rupees - and 25 more locations, including smaller cities and heritage sites.
The company recently won a 15-year lease for the Indian Railways' budget hotel in New Delhi, which will be rebranded as Ginger, Managing Director Raymond Bickson said late on Tuesday. The company has bid for more railway properties, he said.
It is also adding new luxury hotels in Mumbai, Coimbatore and Bangalore, where it has entered a license agreement with a partner with an investment of 1.6 billion rupees.
Betting that a booming economy and efforts by the government will attract more tourists, the company recently opened the doors at its first wildlife lodge at Bandhavgarh National Park in central Madhya Pradesh and is adding Pench in Maharashtra state.
"India as a whole attracts far fewer tourists than Dubai or Singapore... there is clearly room to grow," Bickson said.
About 4.4 million tourists visited India in 2006, or 13 percent more than in 2005, government data showed. A woefully inadequate supply of rooms is also drawing global hotel chains.
Indian Hotels on Tuesday reported a 43 percent rise in quarterly net profit to 879.9 million rupees, helped by a 30 percent rise in average room rates in the top cities. Revenue per available room rose by up to 45 percent, Bickson said.
The company agreed in November to buy The Ritz-Carlton Boston hotel for $170 million and has renamed it Taj Boston. Besides looking for further acquisitions overseas, it is adding a luxury hotel in Dubai, a golf resort in Doha and a resort in Phuket.
A subsidiary in December bought a near-81 percent stake in Amalgam Foods Ltd., which makes ready-to-eat foods, an area Indian Hotels believes has synergies with its airline catering business and could also serve its budget hotels. "Food is a fast-growing space, and we know food, so it made sense for us to enter the retail end, as well," Bickson said.
Source:ndtvprofit.com
