The Hindu Business Line : Royal Orchid plans Rs 450-cr expansion

Kolkata, Aug. 22 Royal Orchid Hotels Ltd (ROHL) plans to double its room capacity over the next two years. The company plans to build six new hotels in Bangalore, Delhi, Noida, Shimla, Mumbai and Hyderabad, which will raise the capacity from 750 rooms to 1,500 rooms.

“We are looking at large-scale expansion across the country. We plan to set up six new hotels under four star and five star category in next two years,” Mr C.K. Baljee, Chairman and Managing Director, ROHL, told Business Line . “We are also exploring the possibilities of setting up a few more hotels in places like Indore, Bikaner and Udaipur.”

The proposed expansion will require investment of nearly Rs 500 crore. “We will fund the investment through a combination of debt and internal accruals. We currently have no plans to raise fresh capital,” Mr Baljee said.

The company is looking at various options including lease, investment or management of properties and is open to the idea of forming joint ventures and partnerships with property developers. “We are in talks with several people for management contracts or joint venture partnerships. This enables us to grow fast.”

On hotel occupancy rate in Bangalore, he said: “In the last quarter, the occupancy has been slightly affected mainly due to increase in rooms.”

The company runs nine hotels in Bangalore, Mysore,Pune and Jaipur. The Royal Orchid Metropole in Mysore is the company’s only heritage property.

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