Ginger Hotels to Sell Six Properties

The move is seen aligned with the ‘Aspiration 2022’ strategy unveiled by its parent IHCL, to become less ownership driven.

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IHCL’s (Indian Hotel Company Limited) budget hotel chain Ginger Hotels is looking at selling six properties in locations like Goa, Whitefield Bengaluru, Mysuru, and Pondicherry, according to people aware of the development. 

The move is seen aligned with the ‘Aspiration 2022’ strategy unveiled by its parent IHCL, to become less ownership driven. 

The company has released a mandate to consulting firm Horwath HTL Corporate to proceed with the sale process, and is considering a sale and leaseback arrangement, the persons cited earlier told ET.  “A mandate has been released to the consulting firm for six Ginger hotels currently owned by the company to sell the hotels and do a sale and lease back or management arrangement,” they said. 

IHCL did not specifically respond to the sale plan query but said, “We have shared with media our plans to completely refresh and reimagine the Ginger brand with the unveiling of a new brand identity and enhanced customer experience. A top-notch brand consultant DY Works has helped us for the new Ginger brand identity. A German company, JOI Design, has done the interiors for the new look of the hotels.” 

Ginger was planning to look at mostly leasing opportunities in the metros till its balance sheet is not capitalised. In February this year, IHCL, which operates the Taj Group of hotels, had unveiled the ‘Aspiration 2022’ strategy to improve its EBIDTA margin from 17% now to 25% by 2022 under its new managing director, Puneet Chhatwal. 

Roots Corporation, which operates Ginger Hotels, is a wholly-owned subsidiary of IHCL. The five-year plan for IHCL includes selling its non-core assets and becoming less ownership driven (60% of its assets will not be owned by the company by 2022), reducing its dependence on the luxury segment, moving the hotels portfolio of some of the group companies to the holding company, monetising its non-core assets including residential apartments in Mumbai and other land banks, and forging new external and internal alliances with other Tata Group companies. 

Chhatwal had previously said most of the high growth is in the mid-scale, upscale and budget segment, and that Ginger was growing rapidly. 

(Source: Economics Times)


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