The Hindu Business Line : Sarovar Hotels eyes South to expand

The company has acquired 2.3 acres in Sriperumbudur and one acre in Old Mahabalipuram Road, at Rs 7 crore and Rs 5 crore, respectively, to bring in its own budget hotel brand, Hometel.

Mr Ajay K. Bakaya, Executive Director, Sarover Hotel and Resorts, told Business Line that both 130-room properties will hopefully be up and running by late 2009.

Brand portfolio

Sarovar Hotels is a leading multi-brand hotel management company. Currently, it manages 36 properties with 3,500 rooms in total.

Sarovar’s portfolio consists brands such as Premier, Portico, Hometel, Park Plaza and Park Inn, encompassing 3, 4 and 5-star categories. While Portico (3 Star) and Hometel (3 star budget) are Sarovar’s own brands, Premier (5 star), Park Plaza (5 star) and Park Inn (3 star) are that of Carlson Hotel Worldwide, for which Sarovar is the sole master franchisee in India.

Apart from Chennai projects, it plans two hotels in Chandigarh and Himachal Pradesh (Baddi).

According to Mr Bakaya, the Chandigarh property is under construction and will open soon. On an average, it invests Rs 20-25 crore (excluding land cost) in Hometel and Rs 30-35 crore in Portico hotels.

With four more own properties planned in the next two years and more to come under management contract, Sarovar hopes to have at least 6,000 rooms under its management by 2011.

According to Mr Bakaya, the group is also aggressively looking for properties in places including some heritage sites in Goa and Bhopal. This may even benefit the company as the budget proposals for 2008-09 announced some tax holidays for new hotels in these sites.

Two years ago, Sarovar Hotels raised $8.5 million from the US-based Bessemer Venture Partners and New Vernon Private Equities. Mr Bakaya said the company may go in for second round of funding to invest in proposed projects, should the need be.