Hotel properties in South India recovering quicker than expected, says ITC
CNBC-TV18 has learned that ITC Hotels’ signature properties in South India are staging stunning and surprising recoveries across brands and select locations.
The COVID-19 pandemic may have threatened to throw Indian hospitality down a black hole of economic distress, but if the numbers are to be believed the recovery is well and truly on. CNBC-TV18 has learned that ITC Hotels’ signature properties in South India are staging stunning and surprising recoveries across brands and select locations.
"We just concluded our planning, and have reason to believe that FY22 will see our hotels in the South net 70 to 80 percent of FY20 revenues, while FY23 could either meet or exceed FY20’s revenues,” said Zubin Songadwala, area manager (South), ITC Hotels, speaking exclusively to CNBC-TV18.com.
‘OTA bookings aiding recovery’
The recovery in business comes on the back of smaller booking windows and the re-emergence of the retail hospitality audience making their bookings on OTA platforms like Makemytrip and Booking.com. Historically low average daily rent (ADR) at select hotels, has also boosted business.
"We’re seeing a shorter booking window than before when it comes to bookings at key properties," said Zubin Songadwala, area manager (South), ITC Hotels, "What was a 48-hour booking window pre-pandemic has reduced to just about 24 hours today, with several guests on the lookout for short trips, making use of competitive prices for staycations."
ITC Hotels’ signature property in Chennai, the mammoth 600-room ITC Grand Chola has had 450 of its rooms booked for the weekend, which is a healthy 75 percent in terms of occupancy. Nearly 50 of these rooms, the hotel says, were booked in just one day. For the first time in eight months, the ITC Grand Chola also made a “substantial profit” in December.
Resort property bookings on a high
Resort properties, in Songaldwala’s words have seen bookings "go through the roof", with hotels like the Welcolmhotel Kences Palm Beach in Mamallapuram running at near capacity over the weekend. "These properties are doing better than they did two years ago, and Welcolmhotel Palm Beach is also reporting the highest Average Daily Rent (ADR) realization among all properties in the South."
Even if ADR is to be discounted, properties like the ITC Windsor in Bengaluru are doing 8 percent better year-on-year business, at signature outdoor restaurants like the Royal Afghan.
One of the key factors to aid the recovery has been ITC Hotels’ aggressive promotional schemes to resuscitate occupancy and revenues. The group’s ‘100 percent back’ offer, for instance, has seen guests make bookings at ITC properties, and use the entire booking amount as “hotel credits” on F&B and spa services, in the course of their stay.
Even without the offer, better revenues at certain ITC properties in the south have come on the back of “aspirational” bookings and business at specialty F&B outlets. It also helps that the average daily rent of rooms at the ITC Grand Chola are at an all-time low.
"While the ADR may be competitive, the hotel does well in terms of F&B billing, and that has helped bring business back," said Songadwala.
(Edited by : Jomy)
First Published: Feb 3, 2021 7:14 PM IST
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