ITC may step up its foreign presence in the hotels space, says managing director Sanjiv Puri.
It is presently building one at Colombo, Sri Lanka, its first foreign venture in the segment. Apart from 300 rooms, this will have 48 serviced apartments. It is slated for launch in 2020, the investment being about $300 million (Rs 21 billion).
Said Puri, when asked if they’d look beyond Colombo: “It is possible we might look at countries adjacent to India —West Asia, etc. These are the primary regions of interest, as of now.” These could, he indicated, be more of managed properties, unlike the Colombo one. Its hospitality brands comprise ITC Hotels, WelcomHotels, Fortune and WelcomHeritage. “As of today, 60:40 is the ratio of owned versus managed hotels in our portfolio. The first milestone will be to make it 50:50 and then approximately 40:60," he said. This strategy has been adopted to accelerate growth.
Currently, ITC has 106 properties (13 are luxury ones) and a room inventory of 9,000. In the next three to five years, these would number 130 properties and a room inventory exceeding 12,000.
Its revenue during the first six months of this financial year roser 16 per cent to Rs 7.04 billion. Profit from the hotels business surged by 200 per cent to Rs 287.8 million.
There are seven owned properties in the pipeline right now, of which four are luxury ones. Amritsar, Guntur and Bhubaneswar will come up under the WelcomHotel brand. “The metros and Srinagar will have more of our super-premium luxury ITC Hotels brand,” said Puri.
Adding: "We have just opened the ITC Kohenur in Hyderabad. Next year, we will launch ITC Royal Bengal in Kolkata and then we have the launch of ITC Narmada in Ahmedabad in the pipeline. Our hotel in Colombo will be a super-premium luxury hotel."
Once all this is complete, ITC will further explore possibilities in managed properties. "Eventually, the objective is to have a fairly complete footprint in the larger cities of India," Puri explained.
ITC's move in this regard has been adopted by others, too. Both EIH and Indian Hotels Company have been indicating a move towards the managed property model for a while. EIH's share of owned to managed properties is 70:30 now and it recently said it would like to reverse the ratio.