Valiant, Norwest and Intel Capital invest Rs 200 crore in Yatra.com

It's raining dollars for online travel portal companies operating in the Indian market. Just a few days ago Cleartrip.com raised $40 million (approximately Rs 180 crore) from Concur and now it's Yatra Online Pvt Ltd that has received a little over $40 million (approximately Rs 200 crore) funding from investors like Valiant Capital Management, Norwest Venture Partners (NVP) and Intel Capital.

The investment, Yatra said in an official statement, will help accelerate growth plans by enabling the company to increase sales and marketing activities, expand its hotels and holidays business and selectively pursue strategic acquisitions.

Dhruv Shringi, chief executive officer, Yatra, sais, the company has witnessed exponential growth over the last four years and is now one of the leading brands and household names in India. "This round of funding will enable us to broaden our reach and brand awareness in Tier II and Tier III towns, which are experiencing tremendous growth in e-commerce. In addition, we will use the funds to accelerate our expansion in the hotels and holidays segments," he said.

A leading consolidator of travel products, Yatra.com provides reservation facility for more than 3,800 hotels across 336 cities in India and over 90,000 hotels around the world.

“When we made a seed investment in Yatra.com in 2006, the online travel market in India was still at a nascent stage, but there was a tremendous need for innovation in this sector. We were confident that Yatra was at the forefront of the changing face of travel in India and the company was poised for tremendous growth,” said Promod Haque, managing partner at Norwest Venture Partners and Yatra chairman and board member.

$40 million gives Concur minority interest in Cleartrip

Nasdaq-listed Concur, a leading provider of integrated travel and expense management solutions, has got into a strategic alliance with privately held online travel portal Cleartrip. The arrangement between the duo consists of both a marketing partnership and a $40 million strategic investment for a minority interest in Cleartrip. This alliance, according to company management, aligns with Concur’s strategic initiatives to expand customer base while also entering new geographies, including Concur’s new operations in India.

According to Steve Singh, chairman and chief executive officer, Concur, The Indian economy is fueling a travel sector that is expected to grow to over $20 billion by 2012. "As a global technology provider, we understand that it’s critical to focus on the local needs of each market in which we operate. In partnership with Cleartrip, Concur plans to leverage the synergies of our combined technologies to help us expand our offerings, extend our reach, and make business travel easier for the millions of travelers in India,” he said. Concur is a leading provider of integrated travel and expense management solutions for companies of all sizes. Concur’s easy-to-use web-based and mobile solutions help companies and their employees control costs and save time.

Launched in July 2006, Cleartrip is one of the leading online travel companies in India. Sandeep Murthy, chairman, Cleartrip considers this partnership with Concur as a strategic opportunity that will provide enhanced benefits to the Indian business travel market. "We have built a broad and loyal base of customers who value our simple and smart approach to travel. With a strategic partner in the form of Concur, we will together drive this dynamic category, by helping Indian businesses of all sizes achieve new levels of efficiency in travel and expense management, through enhancements in technology and product offering as well as superior service."

M&A deal value up 270% in January-March

This story first appeared in DNA Money edition on Saturday, Apr 16, 2011.

With the economy gaining momentum, merger and acquisition (M&A) activity, too, has started gathering furious pace.

M&A deals involving Indian companies rose 270% in January-March 2011 to touch $18.3 billion over the numbers reported in the first quarter of last year, according to data by Mergermarket, an independent M&A intelligence service.

Thirty five out of the 57 transactions were inbound deals (over 61%), compared to 27.1% for China and 14.3% for Japan. All the top five deals in value terms were cross border - four inbound and one outbound.

“What was more significant is that the total worth of inbound Indian deals ($16.9 billion) reached unprecedented figures,” Mergermarket said.

M&A advisors say that economic cycle has reasonably or fully recovered, which is showing up in the form of increased traction.

“The economic cycle recovery started around mid 2009 and the momentum continued in the next year as well. That is the key reason behind increase in deal making. There is a change in the base effect, which is evident from the increase in the deal value, though number of deals hasn’t seen a similar growth,” said a senior official from one of the top advisory firms.

Among big-ticket deals, acquisition of Paras by Reckitt Benckiser and International Paper’s acquisition of Andhra Pradesh Paper stand out- especially the latter. Experts say it is the first time that a public company has received such high premium (240%) that too in the paper business, which is not perceived to be very attractive.

“Overall, the M&A volumes will remain and only grow from here. I am certain that we will see strong momentum on the back of economic recovery,” said Gaurav Deepak, co-founder and managing director, Avendus Capital.

Experts said an intrinsic value benchmarking has begun in the Indian market wherein strategic buyers are driving value creation and value discovery, which augur well for the Indian business environment.

While sentiments have improved in the last 12 months, the economic activity was subdued in Q1 of 2010 and the January-March 2011 numbers also included two large deals.

Besides, time taken to conclude these deals is also a key differentiator, feel experts.

“Typically, a cross-border M&A deal for any large corporate is spread over 4 to 5 quarters while it is 6 to 9 months in case of a domestic transaction. In 2009, no corporate was even thinking about doing M&A as focus was largely to swim out of the rough recessionary waters,” said Deepesh Garg, director, o3 (Ozone) Capital Advisors.

The confidence started building in 2010 as a result companies began negotiating deals all over again. So deals that are getting announced in the last few months are the transactions that were in various stages of due diligence and got concluded in the first quarter of 2011, he said.

“In the last 12 to 16 months, corporates stayed bullish, which is largely the reason behind a bunch of deals getting concluded,” he said.

On the impact of long gestation period on deal value, industry experts feel a lot of it depends on how the company has performed in that period, performance of the market, additional bidders for the company, etc. “I wouldn’t say there is a significant change in the deal value from the time negotiation starts to its actual conclusion. However, in case of auctions, the valuations do tend to sway 30% to 40% either ways, depending on the kind of response a particular asset generates from the market,” said a senior official from a leading domestic advisory firm.

On the outlook, experts feel that current traction will continue if economy doesn’t slow down in the coming months. “If everything continues the way it is I am sure the momentum will only pick pace from here with more and more deals getting announced in the coming quarters. From what we have gathered through our interactions with large corporates globally, every strategic presentation has pieces of India as part of their strategy which clearly shows there is a lot of global interest in the Indian market,” said Garg.

Trent honcho jumps ship to MobileStore

This story first appeared in DNA Money edition on Wednesday, Apr 13, 2011.

Essar Group company The MobileStore Ltd (TMS) has appointed the Tata group veteran Himanshu Chakrawarti as its chief executive officer.

Chakrawarti joins the group from Landmark, the leisure retail format of Tata group company Trent Ltd, where he was the chief operating officer.

When contacted, Chakrawarti declined to comment on his appointment.

An Essar Group spokesperson, however, confirmed the development about him joining TMS. “Chakrawarti’s rich multi-category retail experience will provide vital strategic lead to take TMS to the next level of accelerated growth, which now includes consumer durables and information technology retail also,” the spokesperson said.

Chakrawarti replaces Srikant Gokhale, who is believed to be pursuing opportunities in the teaching space. Chakrawarti is likely to take charge within a week.

A graduate from IIT Kanpur, Chakrawarti joined Trent in November 2000. On Chakrawarti’s replacement, a senior Trent official said, “Ashutosh Pandey who deputy COO has been elevated and is now Landmark’s chief operating officer.”

Blue Coast to invest Rs1,500 crore in three hotels

This news story first appeared in DNA Money edition on Wednesday, Apr 13, 2011.

New Delhi-based Blue Coast Hotels that owns the Park Hyatt Goa is setting up three hotels in North India.

Senior company officials said like their flagship project in Goa, the new hotels will be landmark properties and managed by different international hotel chains.

“We have already tied up with international hotel management companies to brand and operate the upcoming properties. The 500-room Delhi hotel will be managed by the Las Vegas-based MGM Mirage Hospitality under its two brands MGM Grand and Skylofts, while those coming up in Chandigarh and Amritsar will be managed by Starwood Hotels & Resorts under Sheraton brand. The hotels will open in another two to three years,” said a senior company official.

The new developments will entail an investment of Rs 1,300-1,500 crore, which will be funded through a mix of internal accruals and debt. In all, the new hotels will add over 850 guest rooms taking the company’s total inventory to over 1,100. The projects will be owned under two subsidiary companies — Golden Joy Hotel Pvt Ltd and Silver Resort Hotel India Pvt Ltd. The companies were incorporated by Blue Coast in fiscal 2010 to execute its hospitality expansion plans.

Blue Coast had introduced of India’s first Park Hyatt branded resort and spa in 2002-03. The 250-key five-star deluxe Park Hyatt Goa Resort & Spa is located at Arossim beach, Goa.

Warburg Pincus invests $100 mn in NDR's logistics company Continental Warehousing

An edited version of this news story first appeared in DNA Money edition on Tuesday, April 12, 2011.

Warburg Pincus is acquiring minority stake in a leading logistics service provider NDR Group's flagship company Continental Warehousing Corporation (Nhava Seva) Ltd (CWCNSL). Indian affiliate of the global private equity major, Warburg Pincus India Pvt Ltd will invest up to $100 million in Continental Warehousing through a mix of primary and secondary placements. The new investment will be Warburg's fourth in the Indian market in the last 12 months.

Officials from both Warburg Pincus India and Continental Warehousing refrained from sharing details on secondary transactions related to this placement. Industry sources however, said, “One of its existing investors, IL&FS Investment Managers Ltd (IIML) will exit completely while a few others are likely to divest partially.”

Accordingly, IL&FS Investment Managers which had invested around $7 million in Continental Warehousing three years ago will be selling its entire stake to Warburg Pincus India. Other investors like Aureos India Fund and ePlanet Venture who came on board collectively investing $16 million in 2009 are understood to be in negotiations with Warburg's Indian affiliate on their mode of exit.

As for investing in Continental Warehousing is concerned, Vishal Mahadevia, managing director, Warburg Pincus India, said, the investment firm has been actively investing in the logistics space globally. “Within India, we have two investments not directly though in a third-party logistics service provider viz. Gangavaram Port Ltd (port infrastructure company) and IMC Ltd (logistics provider of bulk liquid storage). Continental Warehousing is our first investment in a third-party logistics, infrastructure company,” he said.

Pioneers in the logistics segment, the NDR Group has an integrated national network of logistics and related infrastructure facilities across 50 centres in the country and a large client base. This investment in CWCNSL, according to company management will largely be used to fund the expansion of its businesses and strengthen its position as an end-to-end logistics solutions provider by developing rail-linked inland container depots at various locations across the country.

According to N Amrutesh Reddy, executive director, Continental Warehousing, the size of the company is approximately Rs 1,000 crore and has been registering a year-on-year growth in the range of 70% to 100% in the last three years. “The investment from Warburg will be used for organic growth where we will be putting up rail-link inland container depots (ICDs), and container terminals and domestic hubs as they are all linked by rail and are very capital intensive in nature,” said Reddy.

The Indian logistics market is currently pegged at around $75 billion and growing rapidly. Industry experts are of the opinion that Indian corporates and customers are till early in their adoption cycle of the total supply chain solutions.

“If you look at some industry estimates, only 10% of logistics functions in India are estimated to be outsourced to the organised players. The figure is anywhere between 40% to 80% in more developed economy. However, the advent of GST and other improvements is a great opportunity for leading players like NDR to benefit and help reduce their customers' costs and also re-engineer the overall supply chain,” said Mahadevia.

Outlining the opportunities and challenges faced by the fraternity, Reddy feels introduction of GST will be a great boon for the existing players in the market. “While I don't see any other significant challenge, I think acquiring land parcels for the rail link ICDs at times proves to be difficult task. There is no government participation in this area and has to be done with private players only,” he said. On their listing plans, Reddy said that Continental Warehousing would ideally look to go public in another three years from now.

IHG, Marriott partner funds to invest in India

This story first appeared in DNA Money edition on Thursday April 7, 2011.

International hotel chains that have been mostly managing hotels in India are finally betting their own money on the Indian hospitality market.

They are taking equity positions in upcoming mid-market business hotels, if the recently concluded two deals are any indication.

InterContinental Hotels Group (IHG), the world’s largest hotel group by number of rooms, has signed a joint venture agreement with Duet India, a hotel investment fund, to set up 19 Holiday Inn
Express hotels across India.

Similarly, Marriott International, America’s largest hotel chain, has formed a joint venture with a newly formed hotel fund — Samhi Hotels Pvt Ltd — to build a chain of 15 Fairfield branded hotels in the country.

Interestingly, this is for the first time that international hotel companies are investing in hotels rather than doing pure-play management contracts.

“It’s a very positive development showcasing the confidence level in the Indian hospitality market and the willingness from international hotel chains to actually invest as against management and franchising. This certainly paves the way for more such arrangements,” said a top official from a leading hospitality consulting firm requesting anonymity.

Paul Logan, vice president - development, IHG Asia Australia, said, his company will hold a 24% stake by investing $30 million in the venture formed with Duet India.

“The decision to invest was motivated by the fact that Duet very well understood the hospitality space, the team has vast experience in developing hotels in the country and most importantly, it has demonstrated capability by opening two hotels,” said Logan. Navneet Bali, chief investment officer, Duet India, said a new JV entity - Duet Smart Hotels (India) Ltd - has been instituted with a corpus of $150 million. “We have already identified a few sites in cities like Ahmedabad, Hyderabad, and Chennai for developing the first few Holiday Inn Express hotels.

The Ahmedabad property is scheduled to open mid next year. We are already looking at a host of sites across Tier I, II and a select few Tier III markets and hope to close the transactions post the final due diligence. All 19 hotels with a total of approximately 3,300 guestrooms will be operational in three to five years from now,” he said.

Bali said his fund is open to more such partnerships with other hotel chains.

Marriott will take 30% stake in its joint venture with Samhi, according to a report in the Wall Street Journal, which will decrease to 10% over time. The venture is expected to operate around 15 mid-tier hotels in India by 2015.

Samhi Hotels, the investment fund, has been set up by Steve Rushmore, founder of hotel consulting group HVS, Ashish Jakhanwala, a former development director with Accor India / InterGlobe Hotels and Manav Thadani, a former HVS honcho. Samhi will raise around $150 million in a first round of financing from GTI Capital Group, an India-focused private investment and advisory firm and expected to raise up to $250 million by 2012 or 2013, the report said, quoting Jakhanwala.

Marriott to open 6 hotels this year

This story first appeared in DNA Money edition on Wednesday April 6, 2011.

Global hospitality major Marriott International will open six hotels in India this calendar year, adding 1500 guestrooms to its inventory in the country.

With the launches, the total guestrooms of the US-based company in India would rise to 5,000 rooms and the number of operational hotels to 18.

Rajeev Menon, area vice president, India, Pakistan, Maldives and Malaysia for Marriott International Inc, said growth is the big focus for his company in India. “We have 12 hotels in the India portfolio and are gearing up to open three more in the next 60 days. These will include a JW Marriott in Chandigarh (165 rooms), a Marriott in Jaipur (365 rooms) and a Courtyard by Marriott City Centre in Pune (178 rooms),” he said.

During October to December 2011 Marriott plans to open three more hotels — JW Marriott in Bangalore (300 rooms), Courtyard by Marriott in Bhopal (150 rooms) and a JW Marriott in Chennai (380 rooms). All the hotels in India so far are under management contracts with different asset owners.

“From growth perspective as one of the fastest growing international brands, we will be in the top league with 18 operational hotels across upscale, upper upscale and luxury brands in India,” said Menon.

While Rahejas own the Bangalore JW Marriott, Viceroy Hotels is the asset owner of JW Marriott in Chennai. Incidentally, Viceroy is in the process of hiving off the two developments to reduce its debt burden.

Marriott, however, is optimistic that JW Marriot Chennai will open this year.

“Delays are quite typical for any new hotel opening in India and may take three to six months more from the original schedule. We don’t foresee any delay but in case there is, the Chennai hotel will start receiving guests early 2012. Our Renaissance Hotel in Bangalore (also owned by Viceroy) is scheduled to open sometime mid-2012 and is not part of the 2011 plans,” said Menon.

Marriott will also introduce its Fairfield Inn & Suites brand of hotels in the mid-market business hotel segment.While management contracts would remain the key driver for Fairfield’s growth in the initial stage, Marriott may to take franchise route to expand its presence at a later stage.

'It will be very hard for new hotel management companies to compete in India in the long run'

Vasant Prabhu

Vasant Prabhu, vice-chairman and chief financial officer, Starwood Hotels & Resorts, in an earlier interaction delved upon the global hospitality major's business approach to the Indian market, competition from domestic and international players, introduction of new brands, investment thesis etc. Edited excerpts...

What are the challenges of developing and operating a hotel in India? Should people really invest in hotels or stay away from it?

Challenges in India are primarily in the form of cost of land and cost of capital. These are significant issues and partly linked to infrastructure. Owing to limited infrastructure land values go up significantly wherever there is related development. Once infrastructure gets more widespread I think land prices will become more reasonable.

In the hotel industry there are two ways to make money, one is through profits generated by the hotel and second is appreciation of the asset itself. In Asia, because of large and growing population land is scarce and very often asset appreciation has been enough to generate a good return on investment. So it's possible that in big cities where land is expensive, one may think the returns are insufficient purely on a RoI basis. However, what most owners have realised is that asset appreciation over the years can actually give good returns.

The mindset is not unique to India because people perceive this business similarly in many parts of the world. More so in places like Hong Kong, Singapore etc. a lot of hotel owners have made money not from profits but appreciation value. Hotels can create appreciation by creating infrastructure around thereby enhancing the asset value. From an operating performance stand point, I don't think RoI alone will determine whether people should invest in hotels or otherwise. But one has to be careful when playing the game, because if the site is completely commodity like and the hotel is not unique, one may not get the appreciation. In such a situation, RoI is the only deciding factor.

How does Starwood view the Indian hospitality, travel and tourism industries? Where do you think the sector is headed in the near and distant future?

We are very enthusiastic about the Indian market and we think the space will continue to remain very attractive for the next few decades and more. The primary reason, we think, is that India is still very under-served as far as supply of hotels is concerned. With the country's infrastructure viz. roads, airports, railways getting better we certainly foresee a lot of action in the inbound and domestic travel and tourism space going forward.

For Starwood, India is a very long term focus market which is evident from the fact that we have been operating in the country since 60s and 70s with the Sheraton brand. The year 2010 has proved to be a better year vis-a-vis 2009 and business scenario in 2011 is looking very good not just in the Indian market but globally. The sector has seen significant revenue growth in the western countries and Asia including India in the previous year and we see the momentum continuing in 2011.

But growth in India has largely come from the domestic market as compared to overseas business.

Travel patterns are changing everywhere and we see that happening in the Indian market as well. Twenty years ago, in a typical Chinese hotel, 80% of the guests would be non-domestic travellers and the scenario today is completely reverse. I think those patterns will change everywhere including in India. Domestic is a long-term story and I don't think hotels business in India can be built keeping only the foreign travellers in mind which used to be the case earlier. Indian business travel will largely dominate the hospitality sector in the country.

Hotel asset owners in India associate with foreign chains for their global network and value add-ons. Given the domestic focus you spoke of, will the scenario change in the coming years?

Not really. There are various benefits for a hotel asset owner when joining hands with a foreign chain and I think that will continue. In our case, Starwood Preffered Guest (SPG) is a very powerful loyalty programme that assures one out of every two rooms in a Starwood branded hotel globally, being occupied by a SPG members. So we certainly can fill hotel rooms with this unique offering.

Our reservation systems provide our partners with a much broader access than anything they could do on their own. Our sales offices call on corporations globally so a lot of business in India could be because we have a contract with IBM that was negotiated in the US on a global basis. The same would be true for a contract with a Korean company negotiated in Korea which has a big presence in India. So it may very well look like domestic business but it was really sourced through a global contract.

Has the influx of foreign hospitality brands posed any challenges for Starwood in terms of the development pipeline in India?

There is a lot of competition for sure and there is nothing wrong with it. In the end, I think, people who are going to do well are the ones who can make the most money for their owners and offer guests the best hotels. A good hotel is a combination of design and service from the brand's perspective. As for the asset owner, the deciding factor largely revolves around return on investment. Influx of foreign hotel companies in India is because there isn't much growth outside the developed world and many of them do not have a strong presence outside India. I think it will be very hard for them to compete in India in the long run.

While the new entrants might succeed in the short-term because asset owners may get tempted to go with people offering better deals, willing to do it for less, giving them money to put their brands on hotels. I think an owner should remember that they are handing over an asset that may be worth $50 mn or $100 mn to a company to run which is bit like giving your personal money to a wealth managers not because they gave you the lowest rate. It is always advisable to hire someone who can give you the best return which is true with our business as well. I think people have to be very careful when they make such decisions. What will happen over time is there will be a separation between companies that can actually deliver and vice versa.

Some of your brands are still to establish presence here. What are the possibilities of them showing up in the near future?

Brands like Sheraton and Meridien have been in the country the longest. In the recent past we have introduced Westin, The Luxury Collection, Aloft and Four Points brands. Going forward we would very much like to see our W and St Regis brands in India. They will take some time considering hotels take 2 to 3 years to come up but they will definitely come.

Will you be very selective expanding W and St Regis brands in India?

Yes. We would like to have more W hotels going forward in addition to establishing St Regis in two major Indian metros. St Regis is our highest rated brand and we are very selective with its development. Among various parameters include right location, right owner, very high quality product etc so that we don't make any mistakes because it will hurt the brand. The same approach applies to W Hotels as well which competes with the likes of Four Seasons globally.

With Four Points you got into the franchise model, something most leading foreign chains do not approve of in the Indian market. What was the rationale behind taking this route?

I agree. Franchising is certainly a tricky proposition and we prefer not to franchise outside of the US. We have chosen to franchise and will continue to do so in India only with players who have the management bandwidth / capability or a efficient partner to manage the hotels. We pursue franchising in the US because there are more companies that can manage hotels which is tougher when you look at markets outside (the US). Our plans going forward is to include Four Points and Aloft in the franchising bouquet (under the right circumstances) but we will not franchise brands like Sheraton, Meridien, Westin and if we do so, it will be very unique situations. There certainly will be no franchising for the St Regis and W Hotel brands.

But, you also have a marketing / franchising relation with ITC Hotels for The Luxury Collection brand.

The ITC relationship is a very different one and has been in existence for a very long time. The promoters (ITC) have very deep management capabilities and that's precisely what I mean when I said unique situations earlier.

ITC will be managing third-party luxury hotels going forward. Will you extend The Luxury Collection association for their management contracts as well?

We will have to wait and see.

You'd earlier expressed about managing over 100 hotels in India by 2015. Could you tell us which category of hotels will contribute significantly to this pipeline?

Our strongest brands are in the upper upscale and above segments. In fact, 90% of our existing hotels portfolio is in the upper upscale and luxury category. As a result, our India pipeline is also skewed that way wherein 80% of the developments will be upper upscale and luxury. We'd certainly like to do more Four Points and Aloft hotels in India and a lot of that will clearly depend on our ability to persuade owners to have faith in those brands. Asset owners will certainly watch how some of our new brands that have opened up are doing in terms of business and I am sure they will realise the potential of these new brands after speaking to our existing real estate partners and that will slowly build overtime.

Will Starwood ever look to invest in the Indian market?

We would consider investments if it made sense. To invest one has to make several things fall in to place, feel comfortable with the partner, return expectations should be roughly similar, and make sure that partnerships are set up in a way that issues and differences can be easily resolved. Joint ventures are never easy and if we can do a clean arrangement where we manage and they own, that's always best. If we own a piece and we manage then we are on both sides, that can get complicated at times. That doesn't really mean we won't do joint ventures but we will be very carefully doing it in India. We have done a lot of joint ventures globally and are part owners in 40 hotels around the world and they are all working fine for us.

We used to be big owner of 150 hotels and have so far sold about 90 of them and continue to own the balance. We have another 50 hotels in joint venture arrangement, so we are very comfortable investing and owning hotels while simultaneously pursuing management contracts. Over time we will sell the assets as our goal is not to be big owners of hotels but it certainly won't be zero. And if we need to own hotels or be joint venture partners in India we will do that. A lot of asset owners have not wanted our money because they have had a lot of faith in our brands. I think the hotel management company is asked to put money only when the owner is not exactly convinced about the brand and hence they want the management company to take some of the risks thereby bringing their skin in the game.

Is there a sum earmarked for investment in India?

No. We don't have numbers because for us it is strictly a function of what is the opportunity. If you say I am going to invest $100 mn in India, you'll invest that sum and end up loosing all of it. So one should have objectives, what is the return on investment, right partner etc. If we find the right partner we will be willing to invest $50 mn, $100 mn or for that matter even more.

Update from Starwood:

Starwood, Jaguar mark India debut of W Hotel

Over 350 room property will be part of iconic 55-storey Namaste Tower in Mumbai

Continuing with its global expansion plans, W Hotels Worldwide has set its foot in the Indian hospitality market. Part of Starwood Hotels & Resorts, the hotel company has signed a management contract with Indian firm Jaguar Buildcon Pvt Ltd to mark India debut of this iconic luxury brand in Mumbai. The asset owning company (Jaguar) has already identified a three acre land parcel for the W Mumbai hotel which is likely to start receiving guests sometime in 2015. This development was first reported by DNA on February 1, 2011.

Confirming the development Frits van Paasschen, president and chief executive officer, Starwood Hotels & Resorts Worldwide Inc, bringing the W lifestyle to Mumbai is another step in W's global expansion into the world's most exciting and vibrant destinations. “Introduction of W Mumbai will take the total number of Starwood's hotel brands to seven in India out of the nine brands globally. The hotel will offer a contemporary take on design, fashion and music in the heart of one of the city's most vibrant districts, bringing an innovative and distinctive experience to Mumbai,” Paasschen said.

Located in bustling south central Mumbai overlooking the Mahalaxmi racecourse, the W Mumbai hotel will form a part of the Namaste Tower, which will be an iconic 55-story mixed-use development designed by international design firm WS Atkins.

According to Gurinderjit Singh, managing director, Jaguar Buildcon, the hotel will feature over 350 guestrooms, including two signature suites christened WOW Suites and one Extreme WOW Suite (W's version of presidential suite. Among the food and beverage offerings will include two contemporary restaurants and one destination bar. “The hotel will also house stylish spaces for luxury designer retail stores and boast a full calendar of exclusive and exciting W Happenings events that showcase what's new and next in design, fashion and music for both guests and locals alike,” said Singh.

While India's first W hotel is still under construction, the hotel management company is optimistic about generating more owner interest in developing this brand in other key leisure and business destinations in the country. Dilip Puri, Managing Director, India and Regional Vice President South Asia, Starwood Asia Pacific Hotels and Resorts, said, "Locations such as the Delhi NCR region, Goa and Kerala are targets for developing W Hotels and Retreats."

Starwood is also enhancing its leadership position in India and will be opening seven new hotels in 2011 taking the total portfolio to 37 hotels by 2011 end. One of the leading hotel and leisure companies in the world with 1,025 properties in 100 countries, Starwood is on track to operate 50 hotels in India by the end of 2012, doubling its presence in the region in just two years. The hotel company expects to have 100 hotels (open or under development) in its India portfolio by 2015. Among Starwood's hotel brands in India include W Hotels, The Luxury Collection, Le Méridien, Westin, Sheraton, Four Points by Sheraton and Aloft.

Thailand expects 15% rise in Indian arrivals

This story first appeared in DNA Money edition on Monday April 4, 2011.

As more and more Indians take to international travel, especially to Far East destinations, the Tourism Authority of Thailand (TAT) is expecting a higher double-digit growth in arrivals for 2011. In 2010, Thailand received 791,185 visitors from India while the estimated figure for 2011 is upwards of 885,000 visitors — an increase of 15% from the previous year.

Suraphon Svetasreni, governor, TAT, said, last year Thailand registered an overall tourist arrival of 15.8 million, an increase of 12% from the previous year. “As far as India goes, we witnessed a healthy increase of 28% vis-a-vis 2009 arrivals. Thailand has seen continuous growth in Indian arrivals despite the global crisis, dollar depreciation, price hikes and internal disruptions. However, situations started improving in the last quarter of 2010 with an increase in arrival numbers. We expect the trend to continue in 2011 and are confident to cross the 1 million visitors’ mark by 2013,” he said.

Travel and tourism industry contributes anywhere between 8-10% to Thailand’s GDP. According to TAT officials, Indian market is very exceptional because Indians connect easily with Thailand and both nations understand each others’ cultures. Besides, what attracts Indian visitors to Thailand is the destination’s value-for-money attributes and diversity making it ideal for families, newly weds, business travel, meeting, incentive, conference and events (MICE) and free individual traveller (FIT).

Envisaging the business potential from the Indian market, TAT is aggressively working towards establishing a long-term presence in the country and has opened two full-fledged offices, in Mumbai and Delhi.

On TAT’s marketing plans in India, Svetasreni said, “We may not be among the high spenders in advertising and marketing but we are not low either. Given the strong emphasis on India we have earmarked approximately 50 million baht (about Rs7.35 crore) for the country.”

Indians visiting Thailand, according to TAT, are a good mix of leisure, MICE, top-end wealthy travellers with an average length of stay of six days and average spends in the region of 4,600 baht.

Given the close proximity (four hours flying time from Mumbai) Indians view Thailand as a good holiday destination which is why approximately 60% repeat their visit with family and friends, Svetasreni said.

“Thailand is very well connected by Indian carries like Jet Airways, Kingfisher and Air India. In all, there are 138 flights every week with most carries witnessing satisfactory occupancy levels. While October to March is the best time to visit Thailand Indian travellers visit the desination throughout the year,” the TAT governor said.