MUMBAI: The Indian Hotels Company (IHCL), the Tata group's hospitality business unit, that owns and operates the Taj brand of luxury hotels along with seven other brands, has set a path to more than double its revenue to Rs 15,000 crore and also double the number of properties to 700 by the turn of 2030.
The company will invest around Rs 5,000 crore or 5-6% of its annual turnover annually in capex through the reminder of the decade to achieve these objectives, Puneet Chhatwal, the managing director and chief executive of the company told reporters here Tuesday.
The Tatas roped in Chhatwal in November 2017 to turnaround the heavily loss making company. When he took over, IHCL was saddled with a debt pile of Rs 3,000 crore and a consolidated revenue of Rs 4,000 crore from which it had earned a paltry Rs 63 crore.
In fiscal 2024, the topline crossed Rs 7,000 crore while net income stood at Rs 1,259 crore. The company has turned cash surplus with Rs 2,000 crore and no debt, barring some in one of the two London properties, Chhatwal said without identifying the property or the quantum of the debt.
Between FY18 and FY24, the number of properties it owned has grown from 155 to 350 of which 238 are operational, offering over 25,200 rooms, and 112 are under-development. On completion of the work of underdevelopment properties, its total number of rooms will be over 42,500.
Chhatwal said the over the next fortnight a 250-rooom Taj property will be operational near Cochin airport while two more will be ready before the close of December.
“While over the past seven years we have more than doubled the number of our properties, almost doubled the revenue (from Rs 4,000 crore to Rs 7,000 crore), and grew our net profit manifold (from Rs 63 crore to Rs 1,259 crore), we will add up all these by 2030,” Chhatwal said.
He added that the plan is to more than double the topline to Rs 15,000 crore, and enterprise value to Rs 30,000 crore. The Tata group firm also has a target to have 700 properties of which over 500 will be operational by 2030.
“We want to retain our industry leading margins of over 33 percent and return on capital employed at over 22%,” Chhatwal said.
When asked about the number of rooms and capex spends, he told TNIE, “typically we will be investing 5-6% of our topline in capex which over the next five years should be at least Rs 5,000 crore. On the number of rooms, we would be adding around 30,000, taking the total 70,000-odd keys.”
He further said in the past one year alone, the company has net added 10,000 jobs and will add a similar umber by 2030 too. Currently the company employs 40,000.
On the capex plans, which involve an asset heavy-model for the Taj brand, he said till 2018 they owned close to 50% of all properties but since then the company has moved into a mix model and now it’s around 30:70 which means around 30% of the properties are owned by the company and the rest on lease or on rentals.
“No company of our stature and standing can follow only an asset light model. Therefore, for our most serious brands, we will be having an ownership model and for other it could be leased or rental model,” Chhatwal explained.
Apart from the Taj, the IHCL owns and runs seven brands such as the upscale lifestyle offering Vivanta, the low cost business class offering Ginger, Seleqtions, which is a collections brand, the boutique leisure label Tree of Life, Taj Safaris focused on adventure and wildlife, the homestays offering Ama, the airport services Taj Stats and its food delivery arm Qmin.