Comments
Ginger Hotels, run by Roots Corporation Ltd (a unit of Indian Hotels Co. Ltd), is looking to tap the wedding market in the South.
The budget segment hotel chain is keen to get into management contract with family-run businesses to scale up room inventory in regions such as Guruvayur in Kerala.
Explaining the game plan, P.K. Mohankumar, Managing Director and Chief Executive of the Ginger hotel chain, said, “The huge wedding market is a segment that is of great interest for us. We are looking at places such as Guruvayur. There are many big wedding halls, but no accompanying facility for lodging, especially in the branded hotel category. In many of these places, families own large pieces of land. But they don’t have the bandwidth to design and architect a hotel.”
Launched in 2004, Ginger catered to an under-served domestic market for cheap, branded accommodation and started with room rates priced near Rs 1,000. Spiralling land cost and slow process for approvals and permits in the hospitality sector forced the hotel chain to increase their average room rates to Rs 2,000.
To cut costs, the hotel chain has now tweaked its business strategy for future expansion plans.
Strategy tweak
“We are exploring various options – from Greenfield to Brownfield and also conversion of existing operations and management contract route. We are also look at the franchise option,” said Mohankumar.
The company has got responses, mostly from Mumbai and Bangalore and from tier-1 cities in South such as Trichy, Salem, Mysore, Mangalore, he added. “In the North, places such as Chandigarh and Amritsar and new emerging towns such as Kota will be our focus,” he said.
Branded supply pie
According to an industry survey by global hotel consultancy and valuation specialist HVS, the mid-market and budget segment are expected to witness the highest increase in the branded supply pie. This segment was 50 per cent of the branded hotels category under construction in 2012, the HVS report said. The estimated requirement in the budget and economy segment is about 50,000 to 70,000 rooms.
“India is all about mid-market, in terms of hotels and travel. Today, businesses are diminishing. Occupancy levels are coming down as competition gets tougher. So hoteliers are in a transition stage currently,” Mohankumar said.
nivedita.ganguly@thehindu.co.in
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.