Welcomgroup To Kick Off Rs 2,000cr Expansion Plan

Hotels under the Welco-mgroup banner, managed by ITC Hotels Ltd, are to be initiated into a capacity expansion programme involving an outlay of close to Rs2,000 crore.

The programme expected to result in a doubling of group room capacity to 4,800 in the next five years, is targeted towards the higher end markets in Delhi, Mumbai, Chennai and Bangalore.

ITC Hotels managing director S S H Rehman said the company would pump in Rs 700 crore of the required amount, while parent company ITC Ltd would provide about Rs 1,200 crore.

The group's international partner, the US-based Sheratons, are keen to invest if provided with a project.

The total investment could go up to Rs 2,400-2,500 crore. ITC Hotels share will comprise Rs200 crore, raised through internal accruals and the rest by borrowing, rights issues and global depository receipts, he said.

The parent company has already identified sites for building hotels. A string of second-line hotels will bring Pune, Cochin, and Coimbatore into the network. Apart from this industrial investment possibilities have also influenced the location of hotels.

A 100-room hotel, Grand Bay, has been commissioned in Vizag where a number of industrial plants such as the National Thermal Power Corporations (NTPC)100 mw plant, a polyurethelene plant of Indo Rama Synthetics, a calcined coke plant by Rain Calcining and a power plant by the Hindujas among others, with a total outlay of about Rs7,000 crore are coming up.

Welcomgroup, which now has 16 hotels in 15 cities, posted a turnover of Rs369 crore in 1996-97, up from Rs250 crore in 94-95.

Work has already begun on a five-star, 340-room hotel near the Mumbai international airport. Construction of the proposed hotel in Calcutta will begin as soon as the litigation over allotment of land is settled.

Rehman said ITC Hotels was looking to forge joint ventures with real estate developers for building the hotels.