India emerged as a hot destination at the Hotel Investment Conference, South Asia -2009 for hoteliers, who believe the region has huge growth potential.
A large demand for new inventories and smaller presence of branded hotels in the country are key attractions for global chains to foray into the Indian hospitality market. Both, existing as well as new entrants to the market will continue to explore growth in the region.
In his opening presentation, Manav Thadani, managing director HVS India said the Indian industry had many reasons to be upbeat. The positives of the current situation are that: “the liquidity in the Indian financial system is adequate, banks are beginning to lend again and various monetary measures and fiscal stimulus plans are beginning to make an impact.”
Thadani also said that domestic consumptions and rural demand is very strong and must be tapped. The all time low inflation must also be capitalised.
MGM Mirage Hospitality, Dubai-based Jumeirah Group, Wyndham Hotel Group, Langham Hotels International and Corinthia Hotels and Resorts shared plans to launch their brands in the sub continent within the next two years.
Meinhard Huck, president, Swissotel hotels and resorts and Jean Gabriel Peres, president and CEO, Movenpick Hotels and Resorts discussed growth plans for the country. The InterContinental Hotels & Resorts announced plans to increase its existing brand portfolio of 11 hotels by adding 31 more. Tony South, chief development officer, IHG Asia Pacific, said at HICSA: “We have committed sizeable resources to focus on India.”
Of the proposed supply of 114,000 rooms in India only 47,000 rooms are in the pipeline as projects have come to a standstill. But many promised that they will continue with plans – slowly but steadily. Meinhard Huck, president, Swissotel hotels and resorts said the group has plans to manage 15 hotels in India by 2015, the first of which will open in Bangalore. The Accor Group has 48 hotel developments in the pipeline under the Sofitel, Pullman, Novotel, Ibis, Mercure and Formule 1 brand names
Most domestic and international brands spoke of the huge potential of domestic market which has a large number of leisure and business travellers. Domestic brands such as Gateway (from the Indian Hotels Company Limited), Lemon Tree Hotels and ITC-Welcome group among others are looking at targeting the mid-market segment.
The lack of adequate infrastructure continues to be a key challenge cited for growth in India.
Though the market conditions continue to be difficult and funds are hard to come by, they are not non-existent.
Analysts and developers feel that investors are willing to invest stable projects. Analysts at HICSA said the current ‘lean’ period is the right time to invest and build hotels.
