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TC Limited
Report of the Directors
impacted leisure travel as well. The situation worsened
business environment. Occupancies are expected to
with the horrific terror strikes at Mumbai which triggered
rise with economic revival by the end of financial year
off negative travel advisories leading to sharp degrowth
2009-10. Your Company now has over 100 hotels across
in occupancies and average room revenues. The political
80 locations in India, operating under 4 brands. These
uncertainties of an election year added to the dire
situation of the industry. This cyclical downturn impacted
are 'ITC Hotel' at the top end, 'WelcomHotel' in the five
the hospitality industry, though the business has been
star category, 'Fortune' in the mid market segment and
"WelcomHeritage' in the heritage leisure segment. In
able to demonstrate some resilience during this
challenging period. However, the business continues to
addition, the business has co-branding arrangement
pursue an aggressive investment led growth strategy
with two international brands 'The Luxury Collection'
recognising the inadequate capacity and the longer term
and 'Sheraton', franchised from Starwood. Together,
potential of this sector.
these offerings make ITC-Welcomgroup the second
largest hotel chain in India.
Foreign tourist arrivals slowed down in the second half
of the year with y-on-y degrowth as shown in the
During the year the Fortune brand, which covers mid
graph below:
to mid upscale segments, experienced substantial
growth. The brand now has 25 operating properties
600000
20%
and another 27 properties are in different stages of
project execution. The WelcomHeritage brand has now
500000 -
grown to 64 properties.
10%
10%
400000
9% 10%
The recently launched 'Kaya Kalp - The Royal Spa' at
0%
ITC Mughal, Agra has been adjudged the winner of
300000
Tatler's best spa by the London based Tatler Group. The
139
10%
200000
Royal Spa, which is Asia's finest, reinforces the
Company's philosophy of providing premium experiences
100000
for the discerning guest. The business also earned the
distinction of being recognized as the best employer in
Apr-08 Jun-08 Aug-08 Oct-08 Dec-08 Feb-09
30%
Asia in the hospitality sector in a study conducted by
awww Foreign Tourist Arrivals (Nos) Yor Growth (RHS)
the global human resources consulting and outsourcing
firm - Hewitt Associates together with the Wall Street
Journal and Dow Jones. This is a testimony to your
Given such adverse circumstances, your Company's
Company's commitment to its people. In view of the
hotels business posted a decline in revenues by 7%.
positive long term outlook, the competitive strength of
Though Gross Operating Profit (PBDIT) degrew by 19%
this business and the emerging opportunities in this
over the previous year at Rs.384 crores, the hotels
industry, your Company has maintained its aggressive
business maintained its leadership in terms of operating
investment led growth plan. Construction activity in
efficiency as measured by the ratio of PBDIT to Net
respect of the new super-deluxe luxury hotels at
Income at 40%.
Bengaluru and Chennai is in full swing in line with their
The longer term outlook for the industry however remains
targeted opening dates.
robust, given India's inadequate room capacity. A number
The ITC-Welcomgroup chain, with its globally
of projects poised to enter the market have got delayed
benchmarked levels of product and service excellence
due to liquidity crunch, rising interest costs and uncertain
and customer centricity is well positioned to not only
Your Company now has over 100 hotels across 80 locations in India,
operating under 4 brands - 'ITC Hotel' at the top end,
WelcomHotel' in the five star category, 'Fortune' in the mid market
segment and 'WelcomHeritage' in the heritage leisure segment.
ITC Report and Accounts 2009
45
Source: https://www.industrydocuments.ucsf.edu/docs/ynbx0223

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