Itc Hotels Plans Heritage Sector Thrust
Lovelock set to be re-appointed auditors; Pact with Marudhar
The Rs 130-crore ITC Hotels Ltd, the megacorp vehicle for ITC Ltd's Rs 1,100-crore expansion into the hotels sector, is entering into the heritage properties segment in a big way.
ITC Hotels, which is keen to tap the heritage segment, is entering into a joint venture with Marudhar Hotels, owners of Umaid Bhavan Palace in Jaipur, for the purpose. The alliance will manage and market heritage palaces, havelis, forts and resorts with the objective of providing a unique experience to the customers. It will take over all the heritage properties managed by ITC Hotels and owned by Marudhar Hotels, besides signing on new properties.
The hotels business of ITC, the first greenfield business of the company, is also being expanded through ITC Hotels.
ITC, which ventured into the hotels sector in 1975 through the Welcomgroup chain, expects to notch up a turnover of Rs 500 crore from the business over ten years.
Lovelock & Lewes, the auditors who are set to be replaced in ITC Ltd as part of its corporate governance plan are, however, set to be reappointed as auditors of ITC Hotels. Meanwhile, Srinivasa Resorts Ltd, a subsidiary of ITC Hotels, has drawn up plans to raise nearly Rs 6 crore through a rights issue. The company's Grand Kakatiya Hotels and Towers in Hyderabad has established a strong market presence despite growing competition. Fortune Park Hotels, another ITC Hotels subsidiary, has commenced operations and now manages two hotels. Four additional properties, including the hotels in Ahmedabad and Allahabad, are scheduled to open in 1997.
During 1996-97, ITC Hotels commenced work on a 340-room hotel in Mumbai, while the Maurya Sheraton in New Delhi saw major expansions.
Work on the proposed Calcutta hotel would commence as soon as the legal dispute is cleared. During the year, ITC Hotels' operations were further expanded through an operating services agreement to manage the Grand Bay Hotel, a five-star facility in Visakhapatnam. The company said Maurya Sheraton continues to remain the preferred chain for the discerning traveller. ITC Hotels is in the midst of a programme to double room capacity by the next five years. Despite the slowdown during 1996-97 in high-paying tourists, ITC Hotels clocked a net profit of Rs 31.05 crore, representing a 17 per cent growth over the previous year.
Turnover at Rs 130.71 crore grew by 5 per cent, with foreign exchange earnings at Rs 71.92 crore contributing 55 per cent of the turnover.