Mahindra Holidays looks beyond Tier-I cities

The expansion is in line with the company's strategy of owning around two-thirds of the total inventory

Mahindra Holidays & Resorts India Ltd, part of the Mahindra Group, is planning to add 500 units (rooms) over next few years. The expansion will be through both old and new projects. Some of the projects are currently undertaken in Goa, Madhya Pradesh, Shimla, Coorg and Lonavala.

According to the company’s 2012-13 annual report, it added 560 units to its inventory during 2012-13 across 13 resorts — two of which are at international locations — taking total room inventory to 2,480 units.

The first phase of the new project in Virajpet (Coorg) was completed during the year. A smaller expansion also came into effect at the existing property in Varca, Goa. The company also acquired properties in Kandaghat (Shimla), Jaisalmer (Rajasthan), Bangkok (Thailand) and Dubai (United Arab Emirates). It also added inventory by way of long leases in different parts of the country. These include resorts in Cherai-Kochi (Kerala), Poovar (Kerala), Udaipur (Rajasthan) and additional rooms in Yercaud (Tamil Nadu).

The expansions were in line with the company’s strategy of owning around two-thirds of the total inventory. Besides, most of the leased properties are under long-term agreements where Mahindra Holidays manages the resort.

According to the company, it got a strong pipeline of new projects, acquisition and leases, as well as expansion at its existing properties that will become operational during the next few years. A significant expansion of its existing properties in Munnar is under implementation.

The company is currently undertaking five projects: Assanora (Goa), Kanha (Madhya Pradesh), Naldhera (Shimla), second phase at Virajpet (Coorg) and Tungi (Lonavala). These will add over 500 units to the inventory in the next few years.

The firm added it got land bank at 10 destinations and efforts are also on to expand this further. Other than this, some of the company’s existing resorts also have additional land that can be used for further expansion of these properties.

The pace of inventory growth and development of new destinations will continue in future, said the company. In 2012-13, it added 17,489 members to its vacation ownership business, taking the total membership base to 160,747.

Meanwhile, the company has discontinued fresh sales of its shorter duration product ‘Zest’, which had an immediate impact on membership growth.

For its future growth, the company is looking at moving sales and marketing beyond the top metropolitan and

tier-I cities by strengthening its sales and distribution network, which comprises own sales network, on-site office at resort locations and third-party distribution agents.

In 2012-13, the distribution network for the business was expanded from 80 locations to over 100 locations. Most of this expansion was in tier-II cities through third party distribution agents.
ROOMS WITH A VIEW

• Mahindra Holidays & Resorts India is undertaking five projects — Assanora (Goa), Kanha (Madhya Pradesh), Naldhera (Shimla), second phase at Virajpet (Coorg) and Tungi (Lonavala) — that will add over 500 units to the inventory
• For future growth, the company is looking at moving sales and marketing beyond the top metropolitan and Tier-I cities by strengthening sales and distribution network
• In 2012-13, the distribution network for the business was expanded from around 80 locations to over 100 locations, mostly in Tier-II cities through third-party distribution agents