IHCL expands Ginger portfolio with bigger hotels

Ginger, the midscale brand of the Indian Hotels Company Limited (IHCL), is getting bigger. 

The number of Ginger properties and revenue has increased since the brand makeover in 2018. The average number of rooms per hotel is rising too signalling developer confidence and growing travel demand.

The trend is evident both in established markets (like Mumbai, Bengaluru or Goa which are seeing hotels with more than 300 rooms) and also in smaller towns.

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“For Ginger the average number of rooms per hotel used to be around 70 but it is increasing. In our existing portfolio of 60 hotels the average number of rooms per hotel is 83 and that will increase to 115 in our 26 pipeline hotels. More the number of rooms better is the efficiency of a hotel basis the demand in the market,” said Deepika Rao, IHCL’s executive vice president, hotel openings and corporate communications.

“In tier II and III cities where we have entered existing non-branded hotels have a small inventory. Typically, the largest property in these towns would have about 80 rooms. But now developers are gaining confidence to build bigger hotels of more than 100 rooms. I see the change in most tier II III cities except in North East states where room count per hotel is still around 70-80,” added Suma Venkatesh, IHCL’s executive vice president, real estate and development

Currently, IHCL has a pipeline of 26 Ginger hotels and these will come up in diverse markets such as Agra, Ahmedabad, Durgapur, Dehradun, Goa, Gangktok among others.

“Cities are growing creating their own micro markets and business districts. We see a great opportunity in midscale segment and feel that practically every district headquarter in the country can take a Ginger hotel,” Venkatesh said.

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Many of properties are also coming up in cities where Ginger brand is already present. IHCL has been awarded a land lease to build a 300 room Ginger hotel at Mopa airport in Goa It will be the third largest hotel under the Ginger brand. A 371-room property is opening near Mumbai airport is coming soon. A 325 room Ginger hotel that is part of twin project along with 450 room Vivanta will be coming up near Bengaluru airport in next three years. The twin hotels that will be built on a single plot and are in design stage.

The first Ginger hotel opened in Whitefield area of Bengaluru in 2004. Modeled as a budget no-frills brand it sold rooms for Rs 999 a night in its initial years. A lacklustre performance and increasing competition in the budget space forced IHCL to change strategy.

Ginger underwent a brand makeover in 2018. While the average room size of around 200 square feet remained intact, interiors and aesthetics have been changed to give more vibrant look and feel. In-house food and beverage service has been introduced in hotels instead of outsourcing. The existing hotels are being renovated to a “lean luxe avatar.” Around 60 per cent of the Ginger properties have been revamped as a part of the strategy.

Ginger brand’s enterprise revenue grew from ₹200 crore in FY 2018 to ₹360 crore in FY23. The pace of growth has grown 5x and hotel pipeline has increased from five in 2018 to 26 hotels now.

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