ITC Hotels has an aggressive growth strategy in place, says Nakul Anand

Amid a slowdown, ITC's hotel segment has recorded a 40 per cent increase in earnings before interest, tax, depreciation and amortisation, or Ebitda, in the third quarter of financial year 2020, and a 34 per cent rise in the nine months ended December 2019. Nakul Anand, executive director of ITC, tells Ishita Ayan Dutt that ITC Hotels has adopted an asset-right strategy, and in the next few years more than 75 per cent of the hotels that are added will be managed properties. Edited excerpts:
 
How would the asset right strategy help ITC expand more rapidly?
 
With more than a 100 properties across India, ITC Hotels has a large footprint across different locations. Given our rich experience and expertise in hospitality, we are well positioned to help and manage other properties through an asset-right strategy aimed at expanding the inventory of managed properties across India.

 

How many owned hotels are in the pipeline, and how many management contracts? Also, is there any gap in the portfolio that needs to be plugged?
 
ITC's hotel group operates under four distinct brands: ‘ITC Hotels’ at the luxury end, ‘WelcomHotel’ in the five-star segment, ‘Fortune’ in the mid-market- to-upscale segment and ‘WelcomHeritage’ in the heritage leisure segment.
 
ITC Hotels offers comprehensive hospitality solutions through more than 100 hotels in over 70 destinations in the country. Of these, 14 are part of ITC Hotels Luxury Collection, and 16 are WelcomHotel properties. These are a mix of owned and managed properties. Of these, about six are owned WelcomHotel properties. 

 
We are looking at expansion in the WelcomHotel brand, and will soon add about 15 more properties under this umbrella.  
 
What is the timeframe for adding the 15 properties, and how many would be owned?
 
In the next few years, more than 75 per cent of the hotels that are added under our brands will be managed properties.
 
You have serviced apartments in Kolkata and in Colombo, going forward, would it be an adjunct to all your luxury properties?
 
In addition to Kolkata and Colombo, we also have serviced apartments in ITC Grand Chola, Chennai and ITC Kohenur, Hyderabad.  The market for each city is different, and a lot depends on future lifestyle trends and demography of the region. What may work in one city, may not be pragmatic for any other. We will be driven by research and market dynamics for the specific city.

 
Apart from Colombo, would you look at any other properties in the international market? 
 
We are always open to good opportunities that will enlarge our footprint. We are in discussion with some overseas hotels.
 
Are the discussions with overseas hotels for acquisition or management contracts, and in which geographies?
 
We are getting traction in adjacent geographies and to some degree in distant markets. So we are evaluating all these options with focus on management contracts. With our asset-right model, we will be able to take our iconic brands, expertise and cuisines beyond India.
 
Is there scope for taking your signature restaurants outside the ambit of hotels?

 
ITC’s tradition of culinary excellence is reflected in its well-researched cuisine concepts that enumerate ITC Hotels’ objective to showcase Indian and global culinary concepts to both domestic guests and international travellers. We have done select pop-ups with Bukhara in London and Singapore. While these have been immensely popular, we are not planning for any such foray outside the ambit of our hotels.
 
In a world where change is the order of the day, Bukhara and Dum Pukht continue to be acknowledged for their culinary excellence since their inception. Avartana, one of ITC's recently introduced brands, reflects our endeavour to present innovative concepts while retaining the integrity of the cuisine. Given the vast repertoire of ITC Hotels’ globally renowned signature cuisine, we believe this ‘Made in India’ story speaks volume for the strength of our food.

 
ITC wants to be a leader in every segment, what plans is the hotel division chalking out to be a leader?
 
ITC Hotels is already a leader in many ways; leadership in profitability;  we are also the second largest luxury hotel chain.  In addition, ITC Hotels is the greenest hotel chain in the world, while also being a leader in cuisine excellence — a distinction that is reflected in the various awards and accolades garnered by our signature F&B brands.
 
ITC Hotels today has a strength of over a hundred properties across 70 cities. We have an aggressive growth strategy in place that will see these numbers rise further.

 
Introduced in 2010 as the way forward for ITC Hotels, ‘Responsible Luxury’ became a global phenomenon and is now a case study, published in Harvard Business Publishing.