1. How has the company performed so far in 2018 and what are your expectations for the rest of the year?
We are immensely pleased with the performance so far. The Indian Hotels Company Limited (IHCL) delivered Rs 101 Crore Profit, a 4% Growth in Consolidated Revenue and an increase in Operating EBITDA by 11% for FY 2017-18. The company delivered a profit in the first quarter of 2018-19 with a 183 bps EBITDA margin expansion.
2. Which areas are you focusing on particularly in terms of expansion? Any particular cities?
Internationally, we aim to target the locations that have significant customer cross over and where our brands have great visibility and acceptance. Cities with presence of a large Indian diaspora who are ambassadors of our brand would be key entry points for us to venture into geographically. We are excited about our expansion in the MENA region, with three hotels upcoming in Dubai and our first foray into the Holy City of Makkah, Saudi Arabia apart from introducing the Vivanta brand at London Heathrow.
Within the Indian subcontinent, we have just reopened one of South Asia’s oldest historical icons – Taj Connemara after a two-year renovation. We will open Taj Rishikesh Resort & Spa, Taj Aravali Resort & Spa in Udaipur and Taj Theog Resort & Spa near Simla within the next few months.
Today we have a total of 170 hotels which include 25 projects under development across four continents, 12 countries and 80 locations.
3. Is Taj also an investor or purely an operator? What do you think is the ideal model for the future?
Our current portfolio is 65% owned or leased and 35% managed. We aspire to have 50% managed or fee based business and 50% owned.
4. Do you have any plans to expand in China? Why?
We are currently evaluating if China is a market we would like to focus upon. Undoubtedly this is a huge market but also comes with its challenges for international hotel operators if they have properties outside of major cities.
5. How do you think luxury has changed when it comes to hospitality? What do people expect?
IHCL was the first hospitality company to introduce a luxury hotel to India in 1903 with the opening of The Taj Mahal Palace in Mumbai. Guests today equate luxury with personalisation and authentic experiences. Taj Hotels offer a true sense of place with curated experiences seeped in the character of the destination.
6. What are the ingredients of a successful operation? How do you motivate your teams?
I am a firm believer in transparency and collaborating with teams to achieve goals. In order to achieve our many objectives, namely, to increase our EBITDA margin by 8 percentage points to 25%, to enhance our emotional connect with all stakeholders and to continue to be the market leader in all relevant segments, we need to restructure, reengineer and reimagine our business. To support the execution of our strategy, we have realigned our organisation structure in a manner that will promote agility, efficiency and profitability. I am delighted to share that IHCL is the only Indian hospitality company to win the Gallup Great Workplace award for the seventh time.
7. How do you find competition with other Indian luxury hotel brands?
IHCL’s iconic brand Taj is synonymous with luxury with a unique hotel portfolio comprising world-renowned landmarks to modern business hotels, idyllic beach resorts to authentic grand palaces. Our guests have a strong emotional connect with the brand and the reason for this engagement is that all Taj Hotels (within India and beyond) have the ability to weave Indian heritage and culture into the services and offerings. We have summed this up as ‘Tajness’. It is this unique feeling and experience, which sets the group apart from its competitors. Whether it be in a city, resort or living palace, guests experience genuinely warm hospitality, synonymous with Indian culture, a refined luxury rooted in the subcontinent’s heritage and authentic culinary fare, in addition to a world-class level of service and accommodation.
8. What is your approach towards marketing globally? Which consumer targets are you looking to attract to your hotels?
IHCL is the umbrella company with multiple brands. The company started with the Taj brand in the luxury space in 1903. In response to the changing guest needs, it introduced Vivanta in the upscale space and Ginger in the lean luxury segment to address the needs of the price sensitive guests. The target guest across all brands is a mix of domestic and international travellers. With the significant growth of the Indian Middle Class, the domestic traveller is becoming extremely important. The refreshed brandscape gives the company leeway to reach out to the Millennials as well as the traveller with the younger mindset.
9. You recently announced plans for a fourth hotel in Dubai. Tell us more.
We are very excited about the signing of a new Taj hotel at the Deira Creek in Dubai in partnership with Ithra Dubai LLC, a wholly owned subsidiary of Investment Corporation of Dubai (ICD). The Middle East is a significant market for IHCL and we are honoured to be a part of this new venture in the historical and cultural centre of Dubai. IHCL has a long tradition of managing marquee hotels with rich heritage links across the world.
The new Taj hotel is a Greenfield project slated to open in early 2022, part of Deira Waterfront Development – one of Dubai’s most significant rejuvenation projects. An urban oasis, the hotel will have approximately 200 spacious rooms and suites with a selection of rooms cantilevered over the water, with scenic waterfront views.
10. What are your mid to long term plans in terms of resorts?
Taj Exotica Resort & Spa, Andamans opened on Havelock Island in April 2018 as a game changer for the destination. This is the first luxury resort to open within the archipelago and is the latest example of Taj pioneering new destinations. Situated on Radhanagar Beach – a pristine beach said to be the best in Asia, this resort comprises 72 villas. In line with IHCL’s commitment to sustainability and conservation, not one tree was felled during the construction of the hotel to ensure that the fragile eco-system of the island was preserved. Taj Exotica Resort & Spa, Andamans is also the group’s first zero single use plastic hotel.
Our next resort opening is Taj Rishikesh Resort & Spa, located in the foothills of the Himalayas opening in early 2019. Each of the 81 rooms, including 47 villas, and the public areas overlook the Ganges and and have incredible views of the surrounding mountains.
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