Bharat Hotels Ltd, owner of the Grand hotel chain, plans to double the number of hotels it runs to 14 without the backing of the Intercontinental Hotel Group Plc.’s branding strength.
The two companies currently co-brand four hotels in New Delhi, Srinagar, Mumbai, and Goa as Intercontinental The Grand, and will continue to do so.
Bharat Hotels believes the Grand has come into its own as a brand, said the firm’s chairperson and managing director Jyotsna Suri. “I don’t need an Intercontinental in Jaipur.” Intercontinental Hotels declined to comment on the Indian company’s strategy.
“It’s not like they are entirely new to the hotel business. I don’t think it will be a problem for them to run (the new hotels) on their own,” said an analyst who declined to be identified because of the company’s media policy.
The analyst added that The Grand Ashok Bangalore has been performing well without the Intercontinental brand.
Many new hotel developments in India have taken place through local-foreign partnerships; a local company builds the hotel and a foreign company provides branding, marketing, and, in some cases, operates the hotel. For example, DLF Ltd and Hilton Hotels Corp. announced a deal worth hundreds of millions of dollars last year in which they would create a joint venture to develop 50-75 hotels by 2013. Hilton will operate the hotels that will carry various Hilton brands.
Apart from Jaipur, the new Bharat Hotels properties will be located in Bekal (Kerala), Ahmedabad, Chandigarh, Noida, Dubai and Kolkata.
The Kolkata development is a heritage property formerly known as the Great Eastern Hotel that will now be dubbed the Grand Great Eastern Kolkata.
Suri expects to complete development of the seven new hotels, which Bharat Hotels will manage by itself, by August 2009. Bharat will likely go for a share sale sometime after the expansion, said Suri, though she and other company officials declined to specify an exact date.
The company also plans to venture into the budget hotel market.