Luxury hotels operator Indian Hotels Company Limited ( Taj hotels ) wants to reduce its dependence on the Indian market and expand its footprint on foreign shores to generate at least 40 percent revenue from outside India in the future.
"At some point we had over 80 percent of profit and revenue coming from one market. In a global world today, we need to balance our portfolio...So the idea is to have at least 40 percent of revenue coming from outside of India, so we can balance our portfolio in the long term and not have all eggs in one basket," Raymond Bickson, MD said.
Currently two-thirds of its earnings come from India. Also read: Orient Express posts Q3 profit; to reply to Tatas soon In order to increase its income overseas, it has acquired several properties in countries like the US and recently once again bid to acquire Orient Express Hotels, a operator of luxury hotels and trains.
The bid coming at a time the overall hotel industry has been in a downturn did raise eyebrows on the street and Orient Express has not yet responded to the latest offer. It has in the past rejected earlier offerings from the Tatas owned company.
Indian Hotels' executives categorically refused to give an update on Orient Express on Tuesday, but CFO Anil Goel said that when there are opportunities then one needs to take the plunge to grow. "These opportunities don't come knocking every day.
Therefore you bite the bullet. So if you are committed to the product and the market, you take the call," he said. Q2 RESULTS Indian Hotels, which operates the Taj Group of Hotels on Tuesday reported a net loss of Rs 6 crore in the second quarter, compared with a profit of Rs 8 crore a year ago.
Its net sales in July-Sep rose to Rs 379 crore from Rs 358 crore. The company's earnings were impacted by an increase in expenses, even as the overall business remained under pressure due to slowdown in tourist arrivals. Over April-Sep, tourist arrivals in India rose just 3 percent to 2.6 million, compared with near 10 percent growth in the same period a year ago.
Indian Hotels is expecting a pickup in occupancies in the second half, and plans to raise room rates by 5-8 percent. "The performance in first half has been fairly subdued...As we see the next two quarters panning, we definitely see occupancies improving. We do believe we could definitely take up rates marginally," said, Deepa Harris, Senior VP - Sales and Marketing.» Read Complete News.....