Indian Hotels Company Ltd (IHCL) will remain on an expansion spree, as, the leading hospitality player is likely to open more than 50 hotels across brands during the next two years, with a robust pipeline of projects driven by favourable demand outlook.
The company has crossed the milestone of a 300-plus hotel portfolio (includes all five brands – Taj, Vivanta, SeleQtions, Ginger, and Tree of Life). While 218 hotels are operational, about 92 hotels are in the pipeline. “Last year, we signed up for 53 hotels, and opened 20 hotels (excluding Tree of Life). This year, we will open a minimum of 25 hotels, and next year, a minimum of 30 hotels, Puneet Chhatwal, MD & CEO, Indian Hotels Company Ltd told businessline here.
Chhatwal, believes that the hospitality industry up cycle will be a long and sustained one amid some temporary headwinds.
The ₹6,952 crore (consolidated revenue) company, is expected to incur a capex of ₹.2,500 crore over the next three years, as part of its target to deploy ₹3,500 crore in expansion during FY23-FY25. It is now present in more than 130 cities across India.
Hotel supply is expected to grow at a CAGR of 8 per cent over the next three years to reach about 2.41 lakh rooms by FY2027, up from 1.88 lakh rooms in FY24. About 60 per cent of the supply, is likely to be in outside the top 10 destinations.
“With more and more people travelling, demand for hotel rooms is strong, while supply remains a constraint. So, occupancy has increased. Higher occupancy levels help charge higher, leading to a rise in profit. When the profitability goes up, the reinvestment in the business also goes up,” he said.
IHCL also plans to introduce its new brand – a reimagined version of Gateway, which will be a full-service hotel offering in its new avatar in the upscale segment. The brand rollout will commence with 15 hotels and the portfolio is likely to increase to 100, by 2030.