Bhagwati Banquets may take up airline catering

Bhagwati Banquets and Hotels Ltd (BBHL) may enter airline catering services in the near future. The company is presently planning to set up a five-star hotel in Surat.

A leading banqueting and outdoor catering company, BBHL, which owns and runs The Grand Bhagwati Hotel, a three-star hotel in Ahmedabad, is also entering the capital market with an initial public issue of two crore and 30 lakh equity shares of Rs 10 each. The price band for the issue, which opens on April 18 and closes on April 25 has been fixed at Rs 36 to Rs 40.

On the upcoming five-star hotel, Narendra Somani, CMD, BBHL said, "We have already bought the land for the hotel in Surat on Dumas road for Rs 5 crore. The hotel will be completed in the next 18 months and only after that will we look for opportunities like airline catering. However, nothing has been planned for now."

Spread across 65,000 sq ft, the 100-room five-star hotel will mostly focus on banqueting and catering services. BBHL's 55.32 per cent income for fiscal 2005-06 came from its banqueting and catering services which stood at Rs 12.79 crore. The company believes its focus on banqueting, convention and business facilities, which is its business strategy, makes it less susceptible to seasonality factor.

The company is engaged in providing catering services in Surat and other South Gujarat districts, for Taj Hotels in Udaipur, Jaipur and Hyderabad, and for Karnavati Club and Rajpath Club in Ahmedabad.

BBHL had an income of Rs 24.63 crore for nine months-ended December 31, 2006, while its PAT stood at Rs 3.21 crore.