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“With Make in India, boom time for hotel industry”
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Monday, 20 October, 2014, 08 : 00 AM [IST]
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fiogf49gjkf0d  Risan Hospitality Pvt. Ltd is a startup venture under the flagship of RSB Industries. The company aims to venture into the service industry and gain management expertise, market experience, and connect with key players in the industry to create a strong and vibrant brand.
Ratikant Behera, MD, Risan Hospitality Pvt. Ltd, in an interaction with Anurag More, talks about the company, the challenges faced by the Indian hotel industry, and more. Excerpts:
How big is the hotel industry in India? At what rate is it growing?
After a setback due to recessionary trends that prevailed erstwhile, now the market has picked up. Pleasant sentiment prevailing across the globe due to unique and buoyant initiatives from the Centre, and inflow of investments going to take a quantum leap, means more travellers, and obviously, a boost to hotel industry.
How many properties/ brands does your company currently own? Where are they located?
There are currently two brands under the umbrella of Risan. The Haven, which comprises fully serviced residences, more like an apartment-hotel. The second brand being Onset, which is a banquet. Both are located just 10 minutes away from well-known areas and airports, in Kharadi, Pune.
How many properties/ brands does the group intend to launch in the coming years, and where?
The company is very much focussed on the current brands. The company is going to ensure both the brands are recognised for service excellence and customer-friendly approach. There is a possibility of another hotel and banquet coming up in the next two to three years tentatively. The company wants to create a brand before it makes any ambitious plans to expand rapidly.
What is your share in the market?
Share in the market is very minimal since this project is very small. This project is meant to give the company an understanding of this industry and prepare itself to be able to deliver the best in its industry. So we are being patient and understanding this market well and eagerly waiting to start with our first sizeable project.
Would the booming of sectors such as IT and automobiles in India have an impact on the hotel industry?
Yes, certainly. IT and manufacturing industries are big drivers for growth and business influx for any city. When such industry grows and does good business we definitely get the benefit and our business sees growth as well.
What are the trends you have witnessed in the Indian hotel industry?
As any other industry, it has its own cycle of ups and downs. India is witnessing a lot of growth and addition in terms of room supply in all major and tier 2 cities. Though the economy in general is down but the future is brighter than ever. These are tough times that we are going through and competition is high due to oversupply of rooms at the moment. Then again in the future this is going to change and the Indian hotel industry will see good days again.
What challenges is the Indian hotel sector facing, and what steps are being taken to overcome them?
Rising real estate values, rising cost in everything that’s needed to implement a project makes it tough to make a hotel project viable. Also manpower, skilled labour that is required to ensure service excellence has always been tough. Attrition in this industry has always been an issue. Retaining the right manpower by ensuring that it is taken care of and flourishing in career is very much required. Unless you take care and be loyal to them they would not be able to reciprocate the same.
What are the future trends in the Indian hotel industry, according to you?
With anticipated quantum jump in flow of FDIs for “Make & Made in India,” it is going to be boom time for the hotel industry as there will be lot of global corporate visiting India to set up their shops.
How was the last year for India's hotel industry?
Last year was very tough for the industry. Falling occupancy rates and falling average daily rates per room had made the business suffer. Its a ripple effect that you see of our Indian economy and other industries being affected and so this industry also suffered.
What projections would you make for the coming years?
India is projected to be number one for growth globally in the tourism sector in the next five years, clocking over 20 per cent gains annually through 2017, according to a study conducted by SRI International.
With the government’s decision to introduce the electronic visa facility (e-Visa) which will give much needed boost to inbound travel in India, enforcing the electronic travel authorisation (ETA) before the next tourism season, which starts in November, will result in a quantum jump of at least 15 per cent, the hospitality sector in India expects 52,000 new hotel rooms to be added in five years (2013-17), according to a survey by Cushman & Wakefield. This will lead to a rise of over 65 per cent in total hotel inventory in India.
Tell us about your expansion plans.
As I said earlier, we are focussing on building a robust and strong brand that will be known for its service excellence. We can expect another project of the Haven and Onset both coming up in a sizeable manner in the next 2 to 3 years tentatively.
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