Tata group hospitality firm Indian Hotels Company Ltd (IHCL) is looking at growth opportunities in greenfield and brownfield projects to strengthen its footprint in Gujarat. IHCL, which recently opened 111-room Ginger and 175-key Vivanta in Ahmedabad, has 19 properties in Gujarat, including 15 operational hotels and 4 in the pipeline, IHCL Executive Vice President Deepika Rao told PTI.
All of the properties will be operational in the next three years (by 2025), she added. "In Gujarat, we are present in eight cities, some of which have IHCL's multiple brands like in Ahmedabad, where it has Taj, Vivanta as well as Ginger."
"We are looking for opportunities in the state, both green field as well as brownfield projects with good locations," she said. Besides Gujarat, IHCL has a maximum footprint with 19 properties in Rajasthan and Karnataka. "We believe that there will be opportunities for all our four brands in Gujarat, however, growth will be from Vivanta and Ginger," Rao said.
The hospitality firm said it is on track to achieve its targeted portfolio of a total of 300 hotels by 2025. The company currently has 242 hotels, including 61 under development, in total across brands such as the Taj, SeleQtions, Vivanta and Ginger with a combined 29,000 rooms.
Under its 'Ahvaan 2025' strategy, IHCL said it will expand its footprint in relatively untapped destinations such as North East India besides key global markets that have substantial customer crossover with India, through strategic partnerships. Over the last 24 months, IHCL has rapidly expanded with two hotel signings each month, company Managing Director and CEO Puneet Chhatwal said in a statement.
"IHCL is well-poised to meet our goal of a 300-hotel portfolio by 2025, driven by an asset-light model to achieve profitable growth," he added. As part of the expansion, the company's flagship Taj will have 100 hotels by 2025, up from the current 89.
Similarly, the Vivanta and SeleQtions brands will increase to a portfolio of 75 hotels from the current 64. Another brand, Ginger, will see the number increase to 125 hotels during the period from 89 at present, a company official said. IHCL is also scaling up its branded homestay portfolio 'am Stays & Trails' to 500 properties by 2025, from the current 98 bunglows.
In terms of geography, an IHCL spokesperson said, "We will continue to strengthen our presence in key metros, financial and state capitals, leading Tier II cities, commercial centres and popular tourism circuits... We will also continue our legacy of pioneering new destinations by expanding our footprint in relatively untapped destinations such as the North-East." Besides, IHCL will also look to further strengthen presence in "key global markets that have substantial customer crossover with India, through strategic partnerships".
"This includes destinations across the Indian sub-continent, in cities that are on popular travel routes, especially among the Indian diaspora. The Middle East will continue to be a strong focal point for us we have a fourth Taj hotel in Dubai and one in Makkah in the pipeline currently," the spokesperson said. Under its 'Ahvaan 2025' strategy announced earlier this year in May, IHCL had said it would target a portfolio of 300 hotels, have a 33 per cent EBITDA margin with 35 per cent EBITDA share contribution from new businesses and management fees by FY 2025-26.
As part of the programme, the hospitality firm said it is also focusing on re-structuring its portfolio to achieve a 50:50 mix between its owned/leased and managed hotels, which currently stands at 54:46 While there will be a combination of management contracts for Taj, SeleQtions and Vivanta hotels, the Ginger brand expansion will be driven predominantly through operating leases, the company added.
The shares of Indian Hotels jumped 2.65 percent on Friday. The stock was trading 2.32 percent up at Rs 279.75 on BSE at the time of writing.
(With inputs from PTI)
First Published: Aug 25, 2022 2:16 PM IST
