ITC to ramp up hotel room inventory by 50% in the next five years

The company, at its institutional investors and financial analysts day on Tuesday, said that it was targeting to reach 200 hotels

Conglomerate ITC is eyeing around a 50 per cent jump in room inventory in the next five years.

The company at its institutional investors & financial analysts day on Tuesday said that it was targeting to reach 200 hotels with 18,000 keys over five years, with two-third in the managed portfolio.

At present, ITC has 12,000 rooms across 131 hotels and 80 destinations. The company, which pivoted to an ‘asset right approach’ some years back has more than 50 per cent of its room inventory in the managed portfolio.

The presentation made by Anil Chadha, divisional chief executive of ITC's hotels business, to analysts also mentioned that it had a robust pipeline of managed hotels – 35 hotels and more than 3,200 keys. In the next 5 years, the premium hotel keys would constitute 45 per cent of the total managed portfolio, up from 30 per cent today.

Selective greenfield/brownfield projects were also in its sights and 300 rooms were currently being explored in the category. In early 2024, owned capacity would be augmented with Welcomhotel Chennai (renovated 90 keys) and ITC Ratnadipa, Colombo (352 keys).

In the past 24 months (Jan 2022 – Dec 2023), ITC has opened 22 hotels.

It may be mentioned that in August, ITC had approved the demerger of the hotels business, as it had matured, scaled up and was in a position to chart its own growth path.

The growth also comes on the back of the post-pandemic boom being witnessed by the hospitality sector. ITC's hotel segment clocked a record high second quarter performance, with revenues up 20.5 per cent year-on-year (Y-o-Y) to Rs 675 crore and pre-tax profits 53 per cent to Rs 132.95 crore.

But across business verticals, the conglomerate was looking to drive scale and profitability as part of ITC Next strategy.

Chairman and managing director, Sanjiv Puri, is said to have articulated that ITC Next was creating structural drivers of competitiveness with deep investments in innovation to create a future ready portfolio based on science-led platforms that address evolving needs of consumers.

Exports and value accretive acquisitions were also integral elements of the ITC Next strategy.

New vectors of growth were being pursued through higher value added products and services, opportunities at the intersection of digital and sustainability.