ITC to unveil boutique hotels to tap post-pandemic rush

Kolkata: Diversified conglomerate ITC is coming up with a new hotel brand in boutique category to make the most out of the expected post-pandemic hotel boom. The hotel segment now has brands like

Welcomehotel

,

ITChotels

, Welcome Heritage and Fortune. The new brand will be entirely in the managed property segment in tune with ITC’s asset-right strategy for hotel business.

The FMCG-to-hotel-to-tobacco giant has said that plans are on the anvil to introduce a boutique brand,

Storii

, to offer curated travel experiences to the new-age traveller.

The conglomerate is now planning to reverse the ratio between owned and managed properties from current level of 60% : 40% to 40% : 60% going forward.

The hotel segment revenue of ITC is currently at Rs 3,369 crore with a profit of Rs 190 crore. “Your company will continue to aggressively pursue the asset-right strategy leveraging its brands and digital investments, focus on sweating existing assets, creating additional revenue streams and examine alternative structures towards engendering enhanced value creation,” ITC has stated in its annual report.

According to sources, ITC’s ‘asset-right’ strategy envisages a large part of incremental room additions going forward to accrue through management contracts.

“The business is witnessing a growing interest among property owners to align with its iconic brands resulting in healthy generation of leads and pipeline for management contracts. While new signings/openings were adversely impacted during the year due to the pandemic, the business is confident of bouncing back as the situation normalises,” added sources.

Currently, of about 10,000 keys, the company has about 5,300 keys in the managed segment. It has about 4,000 rooms, which are under construction, and of that, 3,000 are in the managed segment, while the 1,000 are owned. Thus, of 14,000 rooms, more than 8,600 would be in the managed segment.

Sources pointed out that the second wave of the pandemic has triggered a fresh round of mobility and travel restrictions leading to severe disruptions. The near-term outlook for the hospitality industry will depend largely on the return of confidence in business and leisure travel. Progress of vaccination, rate of Covid infections and easing of restrictions will be the key monitorables in the near term.

Elaborating on the performance of the hotel business, ITC has also stated in the report that the Welcomhotel portfolio of 19 hotels and over 2,100 keys is poised to scale up further with the addition of several new properties in the near term, in line with the ‘asset-right’ strategy of the business.

The ‘Fortune’ brand continues to maintain its pre-eminent position in the Mid-market to Upscale segment, with the positioning of ‘First class, full-service hotels – an affordable alternative’, comprising 39 properties and nearly 3,000 rooms across 35 cities.

“The ‘WelcomHeritage’ brand retains its leadership as the country’s most successful and largest chain of heritage hotels with an operational inventory of 35 hotels comprising over 900 rooms,” it has stated.