‘We expect prices to rise, over time’

ITC’s hotel portfolio comprises about 10,000 keys across four brands — ITC Hotels, WelcomHotel, Fortune and WelcomHeritage — with about 100 properties in over 70 destinations. These cater to various segments ranging from superlative luxury, leisure, heritage hospitality to branded first class, full service business hotels.

ITC Hotels is aiming to scale up room capacity, and is looking at a significant expansion over the next 3-5 years, says Dipak Haksar , CEO of ITC Hotels and WelcomHotels. Excerpts from an interaction:

What were the main drivers for your growth? How does the future look — revenue- and margin-wise?

It has been good for ITC’s hotels business and we have managed to grow on par with the market. We foresee this trend to continue for the next few years. The growth in yields has been primarily powered by a buoyant retail segment while volumes have evidently been driven by a surge in the MICE-business (meetings, incentives, conferences and events).

What are the hospitality industry trends? Do you see a price correction coming up?

While maximum growth has understandably come from the upper upscale and upscale segments, luxury hotels have also shown healthy growth in both demand and rates.

Industry studies have revealed that in most markets, rates have not yet achieved their potential in the upper upscale and luxury segment. Consequently, it is our belief that a gradual upward price correction will be witnessed over the next few years.

How many rooms does ITC have now and what is the projected increase?

We currently own and manage close to 10,000 keys across our four brands. Our growth trajectory for the next 3-5 years includes an additional 5,000 rooms across these brands.

Where will these new projects come up? Any new locations being considered?

The new hotels will come up in Tier I, Tier II cities and unconventional destinations as well. The ITC Royal Bengal is scheduled for opening in the first quarter of this fiscal. This will be followed by Welcomhotels in Amritsar, Chail, Bhubaneswar, Chennai, Ahmedabad, Katra and the ITC Narmada in Ahmedabad.

What has been ITC’s average occupancy rate and how does that compare with industry... Especially ITC Sonar?

Occupancies vary from city to city depending on demand-supply dynamics. For us, occupancies have by and large been consistent with the market. The same goes for ITC Sonar too.

Which of your properties contributes the best topline and bottomline numbers?

ITC’s super premium luxury portfolio is a major contributor to both topline and bottomline figures.

You had once mentioned that the Fortune brand, targeting the mid market to upscale segment was undergoing consolidation...

Fortune Hotels will continue to follow a management model, whereas the Welcomhotel brand is being consolidated through a mix of owned and managed properties.

What is the status of the Sri Lanka project?

The ITC One Hotel & Residences in Colombo is slated for opening in 2020.

Is ITC looking at any buys or properties to manage?

ITC Hotels continues to pursue an aggressive asset-right-led strategy, in line with our vision to be a leading global hospitality player.