Goldman Sachs checks into SAMHI Hotels with Rs 441 crore

With this, Goldman joins IFC, Equity International and GTI Capital, the existing shareholders of SAMHI

In a sign of increasing interest in the Indian hospitality space, Goldman Sachs has invested Rs 441 crore to pick up an equity stake in Gurgaon-based SAMHI Hotels, a company with a portfolio of 16 operational and 10 upcoming hotels under brands such as Marriott, Sheraton and Hyatt. With this, Goldman joins the group of International Finance Corporation (IFC), Equity International, and GTI Capital, the existing shareholders of SAMHI.

"India is witnessing a steady recovery in economic activity driven by domestic demand. We anticipate this to lead to an upturn in the hotel sector. This investment is consistent with our strategy to invest in sectors and infrastructure that assist in the continued growth and development of India," said Sonjoy Chatterjee, chairman of Goldman Sachs India.

The US-based global investment banking firm had invested Rs 255 crore in Vatika Hotels in December 2014. Vatika operates two hotels under Westin brand in Gurgaon and Sohna. Earlier, Goldman Sachs had made investments in a joint venture project that was developing Four Seasons Hotel in Bengaluru. However, it exited in 2014.

"The investment by Goldman will offer us an opportunity to grow our presence further. We will acquire more ready or under construction assets," Ashish Jakhanwala, founder and chief executive officer of SAMHI Hotels, told Business Standard.

Founded by Jakhanwala and Manav Thadani, SAMHI had secured investment of Rs 127 crore (approximately) from IFC, a member of the World Bank Group, in August 2014. The investment, in the form of convertible debentures, was IFC's first in Indian hotel sector.

Incorporated in 2011, SAMHI is one of the first hotel ownership and asset management-focused companies in India. It owns, develops, and acquires branded hotels in collaboration with multiple operators. It has partnered with global hotel operators such as Marriott, Starwood Hotels, Accor, and Hyatt to manage its portfolio of 16 hotels in 12 cities including Bengaluru, Ahmedabad, Mumbai, Hyderabad and Gurgaon.

SAMHI has grown its presence through a strategy of acquisitions as it was able to find attractive deals in the hospitality space. Last month, SAMHI acquired a 156-room five star hotel in Ahmedabad from Shree Siddhi Group. In July last year, the company acquired a 124-room property in Vizag from Vishnu Priya Hotels. SAMHI has steadily grown its revenue since the launch in 2011 and aims to clock sales of ~120 crore in the current financial year. The company is seeing an occupancy level of about 70 per cent in hotels that became operational about two years ago, while it is lower for the newly opened properties.