India's hospitality sector has witnessed a sustained demand momentum over last three years. According to experts, the outlook for sector remains buoyant as the demand outpaces supply and discretionary spends.
In the current scenario, Indian Hotels Company Ltd's chief has said that the majority growth for the company is coming from the mid market segment.
Puneet Chhatwal, Managing Director and Chief Executive Officer, IHCL told NDTV Profit that the company expects its Ginger brand to contribute 15% to revenue going forward. "Profitability of the Ginger brand is increasing," he noted.
Ginger Brand revenue outlook
Tata Group-owned company on Monday announced that its board has approved and executed agreements to acquire about 51% stake each in two entities—ANK Hotels and Pride Hospitality—which have a portfolio of 135 hotels operated under 'The Clarks Hotels & Resorts' brand.
The transactions (subject to fulfilment of certain condition precedents) aim to address India's heterogenous market landscape and provide deeper geographical penetration across India in the midscale segment while continuing to pursue its asset light growth strategy, IHCL stated in its filing.
Chhatwal noted that the rationale is in line with what we have been guiding under the 'accelerate 2030' of the growth. "Partnership with Clarks Hotels family is in line with IHCL's five-year road map," he added.
"At the same time, it will address the needs and wants of the middle class, that need clean and affordable accommodations in Tier-2, Tier-3 cities, spiritual destinations and Metro cities," Chhatwal added.
Despite new acquisitions, Ginger brand is IHCL's focus for the mid-market segment. "We are also focusing to make Ginger the strongest mid-market brand in the next 12-18 months with 250-plus hotels. We're looking at over Rs 1,000 crore revenue from Ginger at 12-month trailing," said Chhatwal.
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