ITC's focus is on niche areas: Nakul Anand - Financial Chronicle
December 17, 2012
ITC prefers being cautiously optimistic about the prospects of the hospitality industry in India. At least that's what Nakul Anand, ED of ITC, who is also the president of Hotel Association of India, feels. In an interview with Ritwik Mukherjee, he discusses the issues that are troubling the sector and shares the details of the expansion plans of his group. Excerpts:
What are the latest trends in the industry?
To me the latest trends in hotel industry in India are as follows:
(i) Business destinations continue to lead the charge.
(ii) Increased inventories in key destinations and other macro economic factors continue to put pressure on rates leading to lower revpar's. However, volumes are showing upward mobility. The numbers, however, are in comparison to a lower base in the previous year.
(iii) There has been a drop in long-haul holiday travel due to leading economies experiencing recessionary pressures.
The segments demonstrating fair growth are international business travel, domestic business and leisure travel, respectively. The international leisure segment/long haul holiday segment is yet to show growth.
How does the tariff structure for star hotels work in India vis-à-vis other countries?
The rates in India are comparable with similar destinations in the world.
What are the major challenges facing the hospitality industry?
The major challenges facing the hospitality sector in India include shortage of talented manpower. In an industry that is growing, the availability of trained manpower continues to pose a challenge despite the steps that are being taken to create more professionals. Then staff turnover and the non-availability of a reliable pipeline to substitute this turnover will continue to pose a huge challenge for hotel companies and the industry at large.
What is your group's expansion plan?
Our strategy is to clearly focus on new niche areas and provide unique and differentiated value propositions in keeping with our 'responsible luxury' ethos. We have leveraged the unique advantages that India has to offer in terms of diversity and heritage.
We are committed to growth and deploying our full portfolio across all segments because that is what we believe is required to successfully deliver on our ambition and goals to attain competitive growth. In the years to come, we will have a portfolio of 150 hotels. In the super premium luxury segment, we have three hotels under construction and another four hotels on the drawing board stage.
