We will continue to increase stake in EIH: Oberoi

Promoters of EIH, which owns and operates hotels under Oberoi and Trident brands, will continue to increase their stake in the group to ward off any possible takeover bid, its chairman and chief executive P R S Oberoi said today.

"We will continue to increase stake in EIH," Oberoi told reporters after the company's 60th AGM here.

Oberoi said "earlier we were holding 39 per cent stake in EIH. From that, we raised it to 46.4 per cent."

He said that stakeholding would be raised through acquisition of up to five per cent each year.

"It requires a lot of money. We will do depending upon the market conditions," he said.

EIH had been a potential target with ITC picking up 14.98 per cent stake in the company, just short of the trigger for an open offer.

Asked to comment on ITC's overtures, he said "Deveshwar has made some statements. He says that ITC has no intentions of bothering us. I hope he does. I am not worried."

Earlier, ITC chairman Y C Deveshwar had said that EIH stakeholding was purely an investment and there were no intention for any hostile takeover.

Asked about future strategy, Oberoi said that EIH would make investments in strategic properties only.

"Else, we will expand our operations by entering into management contracts only. "We own too much property. Our future lies in operating hotels," he said.

"All our projects either domestic or abroad at present under construction or development are all under management contracts," Oberoi told newsmen.

Asked about the present business scenario, Oberoi said that the current first quarter was better than the previous corresponding quarter.

He said that average room rentals would be raised in September by eight to 10 per cent.

Total income in the first quarter increased 23.3 per cent at Rs 205.16 crore.

Oberoi said that EIH Holdings would look after overseas operations.

To a query, he said that the succession plan would be ready in a year or two.

Further, he said that the company would set up windmills in Rajashthan and Tamil Nadu.

Vice-chairman of EIH S S Mukherjee said that the company would incur an investment of Rs 150 crore for the next two years.