East India Hotels plans Rs.250 Crore investment

East India Hotels plans 250 Crore investment

Friday, 21 August 2009, 02:02 Hrs   |    1 Comments
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Kolkata: East India Hotels (EIH), the flagship company of hospitality major Oberoi Group, will likely have a capital expenditure of 250 crore till 2011, a top company official said here Thursday.

"We planned to spend 350 crore till 2011, out of which we have already spent 100 crore. We are spending this amount for new hotel properties and renovating the existing ones," P.R.S. Oberoi, chairman of EIH Ltd, told reporters.

Talking about the overseas operations of the company, he said: "The company will be managing two Oberoi hotels in Abu Dhabi and one in Oman. We have signed a management contract for an Oberoi hotel and residences in Morocco."

The company, which reported a 21.53 percent drop in its net profit to 170.44 crore in 2008-09, said plans for consolidation and expansion were on track. These include renovation of Trident Hotel in Mumbai, one of last year's terror attacks.

The hotel is expected to reopen in the first quarter of 2010.

Among hotels that are to come into operation is the 440-room Trident Hotel at Bandra Kurla, and another at Gurgaon, near Delhi

Apart from this, the Oberoi Group is also building a hotel near the Bangalore airport and two in Hyderabad under the Trident and Oberoi brands.

EIH's revenues in the last fiscal dropped 7.1 percent to 1,073.06 crore from 1,155.11 crore in the the previous year. The company attributed the drop in revenues to the combined effect of the Mumbai terrorist attacks and the global economic meltdown.

"The global financial crisis and the terror attacks on India's financial capital Mumbai last November have resulted in a sharp drop in foreign visitors to India," Oberoi said.

The tourism industry is witnessing an unprecedented downturn, he said.

"Hotel occupancies and revenues have been significantly affected and the travel and tourism industry is experiencing challenging times. The recent H1N1 pandemic could further restrict global travel."

Oberoi, however, added that the hotel industry would recover from the crisis by next year.

"We expect the first signs of recovery in our industry to take place during the winter season 2010."

The company is planning to add 2,600 rooms to its present 4,022-room capacity by 2012-end, he added.

It is also scaling up its flight kitchen business, with operations in Mauritius, Kochi and Kozhikode expected to commence operations in 2010 while a new flight kitchen in Delhi is expected to start in 2011.
Source: IANS
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