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ITC: Fortune in hotels

Sayantani Kar  |  Mumbai 

is set to add 25 more under the brand in the next year or year and a half. “These are at different stages of development,” says Executive Vice-president (hotels) The tobacco to paper, and major runs 34 at the moment through a web of sub-brands like Select, Park, and

This is a part of ITC’s plan to expand the footprint by “20 to 25 every year,” according to Verma. To meet this target, would sign no less than seven alliances each year. The latest hotel under the brand, the 84-room Haveli in Gandhinagar, Gujarat, for instance, is an alliance. The alliance partners have to spend anything between Rs 20 lakh and Rs 50 lakh per room to meet the standards. Gandhinagar Hotels, the partner for this hotel, for example, invested around Rs 20 crore to refurbish the property and has seen a rise in room tariff. Fortune’s various sub-brands help straddle different price segments in the same city as well as allow it move into lower-tiered cities.

were hit hard during the recent downturn when visitors cut their travel plans. The terror attacks on Mumbai in November 2008 compounded the problem. Occupancy in dropped 50 per cent, according to analysts. Travellers began to downtrade. Because of that, some business went to mid-level brands such as Still, the company had to apply the brakes on its expansion plans. “While we had been growing the brand at 25 per cent in terms of the number of being readied, last year it fell down to less than 10 per cent,” says Verma.” Even so, was able to put nine on the ground.

Alliances are a good way to hedge the risks. earns a fee for from the owner of the property for lending its name and running the hotel. The fee usually is a portion of the revenue earned. does not need to invest in anything but advertising and servicing the

Meanwhile, competing brands such as Taj Vivanta and Gateway too have set targets for the next one and a half years. Owned by Indian Company Ltd (IHCL), which also owns the Taj marqee, these brands fit in the same range as Ten Vivanta and five Gateway properties are slated to come up by 2011. Among the two, there are 23 operating properties. The new ones by would be a mix of both owned as well as managed

Set up in 1995, caters to the mid-priced segment in business and leisure stops. The 34 operating have 4,777 rooms and are present in 44 locations. In the next three to four months, Excalibur in Gurgaon and Loudon in Kolkata will open. While contributing less than 20 per cent to ITC’s total revenue from hotels, comprises nearly 30 per cent of its 115 The brand could ultimately lead to ITC’s own properties as well. Plans are afoot to own two properties under the brand at Bangalore and Coimbatore in the next two years.

First Published: Tue, April 06 2010. 00:10 IST