The LaLiT earmarks ₹600 crore for hotel expansion, to add 1,000 rooms in five years
The LaLiT Suri Hospitality Group has earmarked an investment of ₹600 crore over the next five years to add about 1,000 rooms to its portfolio in hotels it owns and through management contracts in new markets, the company’s top executive told Mint.
“We plan to invest ₹600 crore in properties where we own the land, while using management contracts to expand where our partners bring the capital. Whether we own a property or manage one, every hotel of ours will carry the same spirit and character,” said Jyotsna Suri, chairperson and managing director of the company.
The group owned by Bharat Hotels Ltd plans to add roughly half the new rooms in properties it owns in Ahmedabad and Chitrakoot and the remainder through management contracts. The expansion will take its inventory from 2,300 rooms to about 3,300, an increase of 43%.
The company, which has flagship five-star hotels in Delhi, Mumbai and Kashmir, operates 14 hotels across the country, including 12 luxury properties branded ‘The LaLiT’ and two mid-market hotels under ‘The LaLiT Traveller’ brand.
Suri said the proposed capital expenditure will be deployed in a phased manner over the next five years. Of the total, ₹500 crore is earmarked for upcoming projects at five locations – in Ahmedabad, where it has already deployed ₹104 crore, Chitrakoot, Bekal, Goa and Udaipur. The remaining ₹100 crore will be allocated towards maintenance and refurbishment across its 12 locations.
The investment is expected to be funded through internal accruals and savings, the company added, citing a reduction in interest costs over the past two years. Any additional funding would be arranged through debt from scheduled commercial banks.
Its owned-property pipeline includes a 240-room five-star hotel in Ahmedabad, expected to open ahead of the city's 2030 Commonwealth Games, and a property of about 50 rooms in Chitrakoot. The group plans to add 100 rooms at its Bekal resort, 50 rooms at its Goa hotel and 55 rooms at Udaipur.
The Ahmedabad project has been under development since FY10. It said it would invest ₹150-200 crore over the next few years.
Management contracts
In terms of management contracts, Vrindavan will be the first destination, with the signing of a property of about 75 rooms. The group is exploring opportunities in Chennai, Hyderabad, Leh, Varanasi, Ayodhya, Lakshadweep, Siliguri and the Andaman and Nicobar Islands, among other destinations. It is targeting close to 20 management contracts over the next few years.
The expansion comes as hotel companies seek to add rooms to capitalize on domestic travel demand, while relying on management agreements to grow without investing the full cost of acquiring land and developing properties.
In June, Mint reported that Bharat Hotels was prioritizing consolidation of its portfolio before revisiting its initial public offering plans. Executive director Deeksha Suri told Mint that the company was looking at management contracts and joint development agreements rather than an aggressive asset acquisition strategy. It also planned to continue investing selectively in owned hotels.
“The focus right now is consolidation. Our current mix (of hotels) itself is good enough to show substantial growth. The Indian traveller is keeping the industry going,” Suri had said.
Bharat Hotels reported consolidated net sales of ₹906.7 crore in FY25, up 5.1% from ₹862.3 crore in FY24. Operating profit rose 5.9% to ₹384.8 crore from ₹363.4 crore, according to Registrar of Companies data accessed through Tofler. Its FY26 financial results have not been audited yet.
The company had filed draft papers for a ₹1,200 crore initial public offering in 2018 but did not proceed with the issue amid market uncertainty and the pandemic. Deeksha Suri told Mint in June that the company would explore reviving these plans over the next two to three years.
India’s premium hotel industry revenue is expected to grow by 7-9% in FY27, following an estimated 11% expansion in FY26, according to an August report by rating company Icra. Occupancy is projected to remain at 72-74%, while average room rates are expected to rise to ₹8,600-8,800 from ₹8,200-8,500 in FY26.
Resilient domestic travel demand is expected to support the sector, even as hotel operators expand their presence and increasingly use management contracts to grow without committing capital to property ownership.