Expanding portfolio
Sincere Developers Pvt Ltd is betting big on the rapidly-growing luxury segment of the domestic hotel industry. The New Delhi-headquartered developer, the owner of the Taj Hotel & Convention Centre property in Agra, is looking to set up three ultra-luxury hotels (average room tariff: R30,000-40,000 per night) in the next 3 years. The developer, a part of the Lucknow-based R10,000 crore Ladhani Group with interests in real estate, hospitality, and beverages (the flagship company, SLMG Beverages, is one of the largest bottlers of the Coca-Cola Company in India), is currently in the process of finalising the locations. These three properties are expected to come up at tourist destinations like Jim Corbett in Uttarakhand, Dharamshala in Himachal Pradesh, and somewhere in the North East.
With a total investment of around R1,000 crore, these ultra-luxury properties will have approximately 450 keys (around 150 keys each) under the Taj brand by Indian Hotels Company Ltd. Sincere entered the hospitality sector in 2011 by establishing a 140-room property under the Radisson Blu brand in Agra, which was later converted to the Taj Hotel & Convention Centre with 240 rooms in 2018. The luxury Agra property is currently undergoing a makeover. The company, aiming to build one of the top luxury hotel portfolios (7-8 super luxury properties in as many years) in the country in the next 10 years, is looking to achieve a top line of around R650 crore in the next 5 years.
Paradigm shift
“The luxury hotel industry in India is witnessing a paradigm shift, driven by changing consumer preferences and the growing demand for premium experiences. Post Covid, we are witnessing a new trend where even Indian travellers have become more aspirational and ready to pay any premium for staying in quality/luxury accommodation. This behaviour change has suddenly surged the demand for luxury hotel properties in not only major tourist locations but also in places which are yet to be fully explored. We are already seeing how the demand for luxury residences has gone up in the last couple of years. We as developers would like to position ourselves strongly in this segment of the hotel business and here the Indian hotel brand Taj will be our preferred partner,” says Paritosh Ladhani, joint managing director, Sincere Developers.
Meanwhile, IHCL, India’s largest hospitality company, marks yet another year of accelerated portfolio expansion in FY2024 with 52 signings and 34 openings. Pacing ahead of its market guidance under Ahvaan 2025, IHCL has achieved a portfolio of 300+ hotels including an industry leading pipeline of 90+ hotels.
“With the pace of growth increasing year on year, FY2024 set new benchmarks with 52 signings, one contract a week. Apart from the signing of new projects in international locations, on the domestic front, key signings included large format hotels at international airports in New Delhi, Cochin and MOPA Goa as well as strengthening our leisure and spiritual portfolio across locations like Alibaug, Bekal, Naukuchiatal, Ayodhya and Haridwar,” says Suma Venkatesh, Executive Vice President - Real Estate & Development, IHCL.
“With India’s rising affluence and growing appetite for travel, IHCL will tap into emerging segments with newer offerings like upscale full-service hotels. Our next phase of growth will also be marked by harnessing our existing partnerships for multi-hotel projects,” she adds.
According to a JLL report, India is becoming a top destination for luxury and ultra-luxury hotel companies, driven by a surge in domestic travel and the growing affluence of the Indian middle and upper classes. The emergence of India as an ultra-luxury hotel destination can be attributed largely to the domestic market. Rising disposable incomes are being spent on travel within the country. Post Covid, the domestic travellers are calling shots.
Arbind Gupta
arbind.gupta@businessindiagroup.com