TAJ GVK to build 5-star hotels in Punjab, Haryana

Hyderabad-based TAJ GVK Hotels & Resorts Ltd will spend Rs 400-500 crore on increasing the room capacity to 2,000 from 1,200 by 2010.

Further, the company is also looking to set up five-star hotels in Ludhiana, Amritsar and Panchkula. It has earmarked Rs 300-400 crore for setting up five-star hotels in this part of the country.

In an exclusive interview with Business Standard, after the board meeting that took place in Chandigarh on Wednesday, TAJ GVK Hotels & Resorts Ltd Executive Chairman G V Krishna Reddy said, "We are looking to set up five-star hotels in Ludhiana, Amritsar, and Panchkula besides the south. The funds for expansion will be raised through internal accruals."

Taj GVK has three hotels in Hyderabad. Outside Hyderabad it has one hotel in Chandigarh and is constructing a five-star hotel in Chennai and one more in Hyderabad.

The company has posted a 22 per cent increase in profit after tax at Rs 19.12 crore for the quarter ended December 2007 compared with Rs 15.64 crore in the corresponding period the previous year. The company's income increased by 17 per cent at Rs 70.74 crore from Rs 60.68 crore in the corresponding period last year.

On being asked about the ongoing expansion plans, Reddy said, "We are planning to spend around Rs 450 crore on various projects. The hotel project at Chennai, Taj Mount Road, is nearing completion and the hotel will be operational by March. The total cost on this project is estimated to be around Rs 140 crore. Further, the Taj Deccan is under extensive renovation to transform the same to a benchmark property in Hyderabad with an estimated cost of Rs 25 crore. Further, the plan for expansion of the Taj Deccan with an inventory addition of 180 rooms at a cost of Rs 100 crore has been finalised and the company is awaiting statuary approval."

It is also setting up a five-star hotel in Begumpet (Hyderabad). The owner of the land is putting up the structure and the company will build the interiors. It will have around 200 rooms with the cost of interiors at around Rs 70 crore, and is expected to be operational by September 2009.

Further, the company is proposing the construction of service apartments (75) and an additional car parking facility on the existing premises of the Taj Krishna, at an estimated cost of Rs 100 crore.

Commenting upon the outlook, Reddy added, "The company's growth during the year will be driven by the buoyant conditions in the hotel Industry, ongoing peak season and commissioning of the Chennai property."

"We also plan to construct hotels in England and the Maldives," he said, adding that the funds required for the proposed expansion would be raised through internal accruals.