With a rich legacy of over a century, IHCL is not just an industry leader but the undisputed custodian of Indian hospitality. Today, IHCL is a robust hospitality ecosystem with a portfolio of 250 hotels across the globe including those under development and the company is on the path to rapid profitable growth guided by its vision of Ahvaan 2025. Puneet Chhatwal, MD & CEO, IHCL in an exclusive interview with Travel Turtle unveils some thrilling projects and initiatives that will ‘re-structure’ and ‘re-imagine’ the way we perceive hospitality.
Bharti Sharma
The hospitality maven, Puneet Chhatwal has managed to drive IHCL in the most coherent and sustainable way. After reigning some renowned global hospitality brands, Chhatwal was all set for a homecoming and there can’t be a better brand for it than India’s most adored ‘Taj’, IHCL. He has been exemplary in terms of operations and has been guiding the brand with his unparalleled experience.
Hospitality sector responsible to preserve the local culture and the environment
Chhatwal strongly feels that while India’s travel and hospitality industry will continue to significantly contribute to the global economy and overall employment, what will truly define the sector in the future will be the pivotal role it will play – as a conservationist of both, local culture and the environment.
He explains, “In recent years, the world has seen a seismic shift, not just in decision-making and buying power, but in the way, people view experiences while being cognizant of the impact of their actions on the globe. India, with its magnitude of kaleidoscopic offerings in terms of geographical diversity, rich history and culture, will continue to lead travellers’ bucket lists when it comes to experience-led travel. And this will not just shape but revolutionize India’s hospitality sector as an enabler of authentic experiences, preserver of heritage, and driver of sustainable travel; while adapting to evolving trends and consumer behaviour.”
India at the cusp of transformation
India’s unique geographical diversity, rich culture and heritage and ancient knowledge of arts and sciences make this country a travellers’ paradise. With over 30 World Heritage sites, 10 bio-geographic zones, 80 national parks and 441 sanctuaries, the country is an amalgamation of all types of tourist destinations. From being the mecca of spiritual travel to slowly evolving as a leading wellness destination, from being known as the land of palaces to becoming a centre for adventure-seekers and a key destination on the global business circuit, we have witnessed a rapid evolution of the travel and hospitality sector in India.
“Today, India is at the cusp of transformation as a key travel and tourism destination across multiple segments such as culture and heritage, leisure, sports, religious tourism and even wildlife travel,” mentions Chhatwal.
He further shares, “Given the significant role travel and hospitality will continue to play in India’s overall growth and positioning, it is imperative that the sector is strategically developed – be it in terms of infrastructure, connectivity, technology and policy frameworks – to help the nation become a $30 – 40 trillion economy in the next 25 years while boosting prosperity and employment generation.”
The overwhelming response to Promo Code Special Rates from IATO members
IHCL rolled out the Promo Code Special Rates for IATO Members during the last convention and Chhatwal tells that the response has been great and encouraging. “We are proud of our longstanding association with IATO and look forward to many more successful conventions with the members in the coming times. The response to the special promotional offers has been very encouraging, especially with our small- to mid-sized agents. It promotes travel and we look forward to even more enthusiastic participation in the coming times. Destinations such as Rajasthan, Mumbai, Goa, Rishikesh-Haridwar and Delhi are proving to be especially popular among members.”
IHCL outperforming the industry
In spite of the many challenges put forward by the pandemic and ensuing limitations on travel, there has been a surge in domestic tourism, with people increasingly looking to re-discover India and all that it has to offer. Be it staycations or driving vacations, the surge in domestic travel has been leading the sector’s rapid revival. The industry has been seeing occupancy levels surpassing even pre-pandemic levels in the past couple of months. Unfolding how IHCL properties performed, Chattwal tells, “With our expansive pan-India footprint and presence across multiple brands catering to a varied target audience, our IHCL hotels have been outperforming the industry in the last couple of quarters. Post-pandemic, we are experiencing robust performance in the current fiscal. Both occupancy and ARR have seen significant growth in H1 FY 2022-23 and are in the excess of pre-COVID levels.”
IHCL has also been witnessing a steady momentum of inbound travel, with international markets seeing a revival of 40 per cent since October 2022; key markets being the USA, GCC and South America among others.
Taj is slated to grow to 100 hotels across the globe
IHCL recently announced its long-term three-pronged strategy to grow profitably – Ahvaan 2025. Under the plan, IHCL will re-engineer its margins, re-imagine its brandscape and re-structure its portfolio. “IHCL aims to build a portfolio of 300 hotels, clock 33 per cent EBITDA margin with 35 per cent EBITDA share contribution from new businesses and management fees by FY 2025-26,” reveals Chhatwal.
Sharing some stirring details, he explicates, “Under Ahvaan 2025, IHCL will continue to Re-engineer margins with an emphasis on sustained revenue growth, cost optimisation and operational excellence. This will further strengthen the balance sheet with a focus on free cash flows and be a zero net debt company. To increase the EBITDA share contribution from new businesses, IHCL with its Re-imagined brandscape will scale Ginger to 125 hotels. Ginger will be one of the most significant growth vehicles for IHCL. ‘amã Stays & Trails’, a branded offering in the homestay market will be a portfolio of 500 and Qmin, IHCL’s culinary and home delivery platform will expand to 25 plus cities.”
IHCL also aims at Restructuring its portfolio and achieving a 50:50 mix between its owned/leased and managed hotels. It will also look to stimulate growth by unlocking capital through strategic partnerships, monetisation and simplification Taj, the iconic luxury brand, is slated to grow to 100 hotels across the globe, and the Vivanta and SeleQtions will scale to a portfolio of 75 hotels. “While each of our brands continues to cater to distinct target markets successfully, we are very proud that our iconic brand – Taj has been recognised as the World’s Strongest Hotel Brand for the second consecutive year. Moreover, Taj has also been rated as India’s Strongest Brand across all categories for the second time – the first being in 2020. These recognitions not only reaffirm Taj as the most acclaimed benchmark of excellence in the industry globally but are also a mark of our stakeholders’ steadfast trust in us,” shares Chhatwal.
“Experiences is the new currency”
While travel has always been known to expand one’s horizons, today, travellers’ expectations from travel have evolved beyond the usual highlights to explore a destination more comprehensively. Chhatwal aptly believes that ‘Experiences is the new currency’ – and travellers are looking for ‘experiences’ that bring alive the spirit of a destination in all its raw authenticity, be it a traditional culture to history to local experiences and traditional arts, food and heritage.
He adds, “This has resulted in the growth of experiential travel, which brings together a mix of cultural exploration and experience-based activities that allow travellers to delve into all that a destination has to offer. For a country like India, which has a kaleidoscope of experiences to offer, offering guests an opportunity to immerse themselves into the country’s unique culture, cuisine and heritage is key to further elevating India’s position on the global travel and tourism map. For hospitality brands, the growth of experiential travel is an opportunity to curate offerings that are immersive, exclusive and unique, while also allowing guests to connect and engage with local communities for authentic experiences while having a positive impact on the community both directly and indirectly.”
Taking India to the world
IHCL is the only Indian hospitality company with marquee hotels in key global destinations such as London and New York, in addition to Sri Lanka, Dubai, Maldives and South Africa among others. The company will continue to expand and strengthen its presence across the Indian sub-continent, in cities that are on popular travel routes, especially among the Indian diaspora.
Commenting on some exciting expansion plans, Chhatwal discloses, “We will continue to have a strong focus on markets such as Dubai – where IHCL has recently opened Taj Exotica Resort & Spa, The Palm (the third Taj branded hotel in the city) and has another Taj hotel at Deira Creek in the pipeline. The Middle East, with locations such as Makkah – where IHCL has a Taj hotel in the pipeline, Riyadh, Jeddah, Abu Dhabi and AlUla, will continue to be a strong focus area for IHCL in the next couple of years for the development of the Taj brand. IHCL will also explore strategic partnership opportunities in key global markets across the UK, US and Europe among others, which have substantial customer crossover with India.”
Sustainability and community-driven initiatives are engrained in the company’s DNA
Today, it has become even more important to chart a future that is more sustainable and inclusive; and we believe this is the only way to drive India’s journey to be among the top travel and tourism economies. While the focus on sustainability and community-driven initiatives has always been ingrained in the company’s DNA, they have recently launched Paathya – IHCL’s ESG+ framework, to drive IHCL’s sustainability and social impact measures. Derived from the Sanskrit term पथ्य; inferring a path, Paathya encapsulates initiatives to lead positive change. The six pillars of Paathya include Environmental Stewardship, Social Responsibility, Excellence in Governance, Preserving Heritage, Value Chain Transformation, and Sustainable Growth.
“Under each of these pillars, we have defined both, short and long-term goals, to be fulfilled by 2030. These include 100 per cent elimination of single-use plastic across all its hotels, ensuring 100 per cent of wastewater is reused, and 100 per cent of hotels will be certified to a global sustainability standard. All business meetings and conferences will go green with the introduction of Innergise – Green Meetings, reducing their environmental impact, etc.
Telling further, he shares, “Taking ahead our commitment to skill building, and creating employability for the deserving and the marginalized, IHCL aims to impact the livelihood of over 100,000 youth. Long heralded as the custodian of Indian heritage, IHCL’s collaboration with UNESCO, will see the adoption of 100 per cent of Intangible Cultural Heritage (IHC) projects in the geographies it operates in.”
Paathya also focuses on driving diversity and inclusivity for our customers, employees and community through our ‘She Remains the Taj’ framework, which encompasses,
o Enhanced experiences for women travellers at our hotels across the globe
o Goal to raise women’s participation in its workforce to 25 per cent by 2025
o Support women-led businesses and partners
Diversifying within the sector
IHCL launched two new businesses not very long ago—amã Stays & Trails and Qmin food delivery. amã Stays & Trails was launched in early 2019 as IHCL believed that there was a need for a branded product in the homestay market in India which was very unstructured. Qmin is IHCL’s culinary platform and food delivery service, which was established during the pandemic. Making use of the power of digital platforms including its own app, Qmin offered people the opportunity to order their favourite meals from leading IHCL restaurants from the comfort of their homes.
“Today Qmin is a full-fledged business vertical addressing multiple segments of the market, present in over 20 cities across multiple platforms – be it the Qmin app for food delivery; Qmin Shops offering gourmet products; Qmin trucks and Qmin outlets. As per our Ahvaan 2025 strategy, Qmin, IHCL’s culinary and home delivery platform will expand to 25 plus cities soon. Qmin is further expanding to Ginger hotels and is currently present at over eight Ginger hotels, with more in the pipeline,” tells Chhatwal.
Amã has a portfolio of over 100 properties and is looking to scale to 500 properties by 2025. Chhatwal shares, “We have a very clear vision for amã. The pandemic validated this belief. The brand did extremely well during the pandemic as a rising number of people embarked on driving vacations with loved ones, leading to a growing demand for exclusive and safe stays. We believe that this brand has huge potential to grow. Our model is very different – we follow a hub and spoke model. The closest IHCL hotel provides support. This leads to operational efficiencies and expertise. The management and operations are overseen by the IHCL team with a sharp focus on safety, hygiene and security. The exclusive bungalows are in unique locales which are scenic and picturesque. We follow strict standards for onboarding. Guests enjoy local and immersive authentic experiences.”
