MAHINDRA HOLIDAYS AND RESORTS INDIA LIMITED
ANNUAL REPORT 2010-2011
This is the second annual report of your Company since its successful IPO
in July 2009, and my second letter to you as the Chairman.
Let me start by sharing with you some facts about Mahindra Holidays.
At the end of 2004-05, your Company had 28,491 vacation owners in its fold.
On 31 March 2011, the membership stood at 125,169. That translates to a 25
per cent compound annual growth rate (CAGR) over six years - a creditable
achievement by any yardstick.
Six years ago, your Company had one product - vacation ownership under Club
Mahindra Holidays. Today, while Club Mahindra Holidays continues to
dominate, it has various other products and offerings such as Zest, Club
Mahindra Fundays, Mahindra Homestays, clubmahindra travel and the newly
launched rugged camping vacations called terra. Each provides
differentiated offerings for various types of clients. And each has a high
Today, your Company has a selection of 35 resorts across hill stations,
beaches, backwaters, wildlife, forts and heritage, as well as international
destinations. In addition, Mahindra Homestays provides the experiences of
authentic India by guests living in carefully vetted Indian homes - ranging
from palaces and heritage properties, to plantations as well as rural and
farm homes. On 31 March 2011, Mahindra Homestays was affiliated with 282
homes comprising 750 rooms across 60 locations in India.
I could go on. The point of these examples is to illustrate the phenomenal
growth and goodwill that your Company has enjoyed over the last six years.
Simply put, we have understood the needs of an increasingly better off set
of consumers who desire to have vacation experiences with a difference;
and, in the process, we have grown the business in different directions
through attractive offerings; all united by the power of the Mahindra brand
- a name associated with trust, credibility and transparency.
Rapid growth, such as what has been witnessed by your Company, occasionally
requires review and consolidation, lest it unwittingly gets out of hand. In
the first half of 2010-11, the senior management of Mahindra Holidays asked
a simple question: 'What are the improvements that we must do today so that
Mahindra Holidays is even better prepared to benefit from future market
This led your Company to initiate measures to further improve productivity
and create an even stronger foundation for growth. There were several
initiatives. Let me name a few.
The first involved strengthening the process of customer acquisition, so as
to build a more robust customer portfolio. The second was to standardize
and further upgrade the quality and processes of customer interface - from
the point of initial contact to sales to member relations and resort
service. The third was to implement processes based upon best in class TQM
principles across the organization. The fourth was to further focus on
building a seamless, enterprise-wide information technology backbone to
handle exponential growth in volumes while increasing customer
Thus, the tasks for driving the next phase of growth were to build a more
robust customer base; standardize and improve all customer facing
experiences; make quality the watchword of the organization; and create a
world class IT system to facilitate all aspects of the business.
It was time to pause; to re-focus on the key drivers; to create an
unmatched customer experience; and move on to the next phase of growth.
These initiatives were identified and put in place in the first half of
2010-11. While they put a pause on growth and somewhat dampened your
Company's financial results, I have no doubts that Mahindra Holidays is
again getting itself into a position to rapidly and profitably leverage the
growth opportunities in India's leisure hospitality market.
As a Chairman of a listed Company, I am expected to be circumspect about
'forward-looking' statements. Nevertheless, I believe that the next year
should see a significant growth in room inventory. Moreover, I expect the
management to achieve its improved quality and productivity goals. If these
were to occur, one should presume that your Company ought to generate
higher shareholder value along with higher revenue growth. I am, therefore,
optimistic of the foreseeable future.
In January 2011, the Mahindra Group launched a new brand positioning
spanning all industries, companies, and geographies. It is expressed by the
word 'Rise'. I am sure that you have seen this in various advertisement and
media releases. 'Rise' articulates a core group purpose: 'We will challenge
conventional thinking and innovatively use all our resources to drive
positive change in the lives of our stakeholders and communities across the
world, to enable them to Rise.' Mahindra Holidays, too, shall 'Rise'. We
will keep raising the bar; re-define and expand opportunities; innovate
products and processes for the customers; and drive change, not just
through greater shareholder value but by bettering the environment and the
lives of our communities.
Thank you for your support. We treasure it.
A K Nanda