Date:28/08/2007 URL: http://www.thehindu.com/2007/08/28/stories/2007082857231800.htm

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Business

Oberoi group plans expansion

Special Correspondent

Three new properties to come up in Bangalore, Hyderabad

Plans Rs. 4,300 cr. investment in
five years
Proposes two hotels
in Bhutan

— PHOTO: A. ROY CHOWDHURY

SPREADING WINGS: P. R. S. Oberoi, Chairman, EIH, addressing the company’s annual meeting in Kolkata on Monday.

KOLKATA: The Oberoi group of hotels is planning a 60 per cent increase in capacity, which entails the addition of 2,700 rooms within five years at an investment of Rs. 4,300 crore.

P. R. S. Oberoi, Chairman and Chief Executive of EIH, the flagship company of the group, told reporters after the company’s annual meeting that the number of rooms in India and abroad, would increase to 6,800 from 4,100 now.

The expansion plan, all through new projects, would include three new properties (hotels and service apartments) at Bangalore and Hyderabad.

To be readied by 2010, these projects are being implemented through a joint venture with L&T for the Bangalore hotel and with the Rama Rao group for the serviced apartments for the Hyderabad project, he said.

A 440-room hotel under the group banner would be completed by December 2008 in Bandra Kurla, Mumbai, followed by a luxury hotel in Gurgaon in 2009. As for the international expansion plan, the locations include Dubai, Maldives, Cambodia, Abu Dhabi (a hotel and a resort), Oman, Egypt, Morocco and Marrakesh. Closer home, two hotels of 30 rooms each, were proposed in Bhutan.

To a question on funding, S. S. Mukherjee, Vice-Chairman, said while Rs. 1,000 crores would be invested by EIH, the balance would be through borrowings or by other partners. It may be mentioned that at Monday’s annual meeting, the company took the shareholders’ nod for altering its articles of association for ‘power to issue shares with differential rights (as to dividend, voting or otherwise)’.

On a second hotel in Kolkata, Mr. Oberoi said the company had been looking for land. Mr. Mukherjee added that EIH was scouting for a partner who had land for a 300-room hotel. He also said that new flight kitchen had commenced operations at Chennai and two more were planned at the international airports at Kolkata and Mauritius. Mr. Oberoi said there was enormous growth in the hospitality industry whose potential was rising in tune with the growth in the economy and the increase in travel — both for business and leisure. He said the outlook for the current year was about 30 per cent better. EIH closed 2006-07 with a gross revenue of Rs. 996.70 crore and a post-tax profit of Rs. 200.50 crore.