Companies

MBD Group eyeing stressed hotels for acquisition to expand footprint

Garima Singh New Delhi | Updated on April 12, 2019 Published on April 12, 2019

Sonica Malhotra, Joint Managing Director, MBD Group.

Hospitality firm MBD Group is exploring acquisition options for some of the stressed hotels in Delhi and might close a deal in the next few months.

“We are in talks with some hotels in Delhi. These are stressed assets and if everything goes as per plan, we will acquire one of them in the next four months,” said Sonica Malhotra, Joint Managing Director, MBD Group.

Eyeing Mumbai, Goa

Apart from Delhi, Mumbai and Goa are two other markets where the company is evaluating acquisition options.

The company, which recently launched its budget hotel brand MBD Express, plans to sign 12 agreements under this division by the end of this financial year.

“MBD Express is a new product. To begin with, the first two agreements will happen in the Delhi-NCR region by the second quarter of the current financial year,” she added.

Typically, the cost of a room in most economy hotels is between ₹4,000 and ₹5,000, but with MBD Express — which is a complete lease model — the aim is to keep the tariff around ₹3,000, she said. The group which entered into a joint venture with German luxury hospitality firm Steigenberger some time back, plans to come up with 20 hotels in the next eight years under the MBD Steigenberger brand.

With this joint venture, the group plans to go asset light. “In the last 15 years, we have done investments in hotels which were completely owned by us but if one does everything out of their own money, they would probably be able to come up with just one hotel in five years,” Malhotra said.

The group is also exploring opportunities in the luxury segment in tier 2 cities and plans to launch MBD Steigenberger in Nagpur and Jaipur by 2020.

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Published on April 12, 2019
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