Recoveries in the hotel industry are currently being driven by domestic travel and corporate travel continues to remain slow, says Puneet Chhatwal, MD and CEO, Indian Hotels Company Ltd (IHCL), the country’s largest hotelier and owner of ‘The Taj’ brand.

The company forayed into homestays under the ‘amã’ brand, and post opening up, is witnessing some movement in the segment.

In an interview to BusinessLine, Chhatwal talks about recoveries, the threat of a second wave of infections on business and overseas expansion plans, among others. Edited excerpts :

What is the outlook now?

Leisure travel is driving recoveries and is going to do so at a domestic level. And there’s a small movement on the corporate side, at the middle and lower management levels; and hopefully that will follow at the senior management level. With foreign delegations coming into India and the vaccination drive, demand recovery should get expedited.

Some states are witnessing a second wave, re-imposition of restrictions. What does the recovery horizon look like now?

Nobody knows what will happen with Covid. In other parts of the world, there is some worry. The safety and security of citizens, our patrons, stakeholders and employees are indeed a concern and priority. So I think we need to remain cautious.

Testing should continue and the vaccination process needs to be further expedited. People should avoid crowded places and large events. This can help control the spread of the virus.

Looking at the current scenario, we are a bit more hopeful now, than what we were some four months ago.

The pick-up happened pre-Diwali and continued for the last three months also. March marks the end of the first year of lockdown in India and will also be the first month where revenues will increase over the previous year’s revenue in the same month. And this trend should continue for the following months unless there are no further lockdowns.

Drivable locations are seeing traction…

Yes, primarily because of the pent-up demand. Our 4 D offer - Dream Drive Discover Delight - which was developed for destinations at short driving distances is doing very well.

But does that give you an opportunity to explore such destinations for new properties?

Property returns are generally spread over a 10-15 year period. Sometimes, it can take a much longer period to generate returns. This is a long term business, not a short-term one.

So will you explore options like home-stays or tie-ups in this regard?

We launched a homestay brand, called ‘amã Stays & Trails’, before the pandemic. We have expanded its presence to almost 40 Bungalows in operation or under development. Right now, there are 19 ‘amãs’ in operation, mostly in Goa and Coorg areas (including Chikmagalur). They are also present in Mumbai and Alapuzha and Trivandrum in Kerala. We are going to open seven more in Munnar. There are more ‘amãs’ in the pipeline in Mumbai, Lonavala and Mahabaleswar. So there is a lot of movement on the ‘amã’ front.

Some of the ‘amãs’ are properties that belong to different Tata companies. They are in very scenic locales like a tea garden or a coffee estate. The ‘amã’ bungalows are in close vicinity to existing IHCL hotels. The management at these hotels looks after the AMA branded bungalows.

Considering international travel remains closed, what are the overseas expansion plans for IHCL?

Our focus, at the moment, continues to be the Indian sub-continent. We want to consolidate here first.

The international market is a concern during this pandemic time. Some destinations like Dubai and Maldives are doing very well which is good for us and other locations like Cape Town, the US and London, are a challenge.

We will selectively consider growth opportunities in key international markets that are relevant for the Taj brand. However, any opportunity must fit in with the Taj brand and also present a viable financial proposition.

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