Reliance Industries group is likely to collaborate with EIH Ltd for a 180-room hotel project at Navi Mumbai.
The EIH Chairman, P.R.S. Oberoi, said here on Tuesday that though a formal agreement has not yet been signed; the two groups were considering the proposal.
“They have a 15-acre piece of land in Navi Mumbai. Their proposal is to build a 160-180 room hotel and adjoining sellable service apartments on the land” P.R.S. Oberoi said.
The Oberoi group may run the hotel on a management contract under its ‘Trident’ brand.
Two other earlier projects — in Goa and Bangalore — between the two groups could not take off, following environmental issues.
Nita Mukesh Ambani and another representative of RIL were approved as directors by the shareholders at the group’s Annual General Meeting here.
According to the Chairman, the RIL nominees were invited to join the board in 2011. Reliance Investments and Holding Pvt Ltd has an 18.53 per cent stake in EIH.
Of the EIH projects at Cyber City in Hyderabad, the 326-room ‘Trident’ is expected to be completed later this year and the 220-room ‘Oberoi’ is likely to be ready next year.
Asset-heavy in terms of property ownership, EIH had to invest “a little” in the Hyderabad project because of the Government norms.
EIH, which drastically reduced long-term debt through utilisation of the Rs 900-crore rights issue proceeds and cut interest costs, may come close to becoming debt-free at the end of this fiscal.
“However, our objective now is to start making fresh investment at an ideal debt-equity ratio of 40:60”, the chairman explained.
“We have reduced our debt when business conditions were not good”, he added.
Recently, EIH registered a new brand, the ‘Oberoi Residency’.