Accor aims to nearly double its network in India to more than 100 hotels by CY27, according to Puneet Dhawan, senior vice president, operations, India and South Asia. The hospitality major, which entered the country in 2005, currently has 55 hotels in its portfolio across the ultra-luxury, luxury, premium, midscale and economy segments.
Raffles, Fairmont, Sofitel, Pullman, Novotel, Ibis, Grand Mercure, Mercure and Ibis Styles are among the nine brands operated by Accor in India. The most popular of them are Novotel and Ibis with 21 and 20 establishments respectively.
Accor has a joint venture with InterGlobe Enterprises, whereby all Ibis hotels in India are jointly owned by the two companies and managed by the former.
“Our goal is to reach more than 100 hotels in the next five years. We have a very aggressive and ambitious expansion plan. We engage with many existing partners and talk to new partners who are truly driven by India’s growth story in hospitality. We believe that in the next five years we can double our network,” Dhawan told FE.
In CY22, Accor will open new Ibis hotels in Hebbal (Bengaluru) and Thane. In addition, new Novotel hotels will open in Mumbai and Jodhpur this year. Additionally, the company will expand its ultra-luxury portfolio by opening a new Raffles property in Jaipur next year.
Speaking about the impact of Covid-19 on the hospitality industry, Dhawan said no one has a playbook on how to handle the pandemic. “Businesses go up and down. But it was the first time that all the hotels were closed. If we take CY19 as a baseline year, the revenue shortfall for the hospitality industry was 50% to 60% in CY20 and CY21,” he said.
With healthy pent-up demand and an uptick in business travel and MICE (meetings, incentives, conferences and exhibitions), Accor’s revenues in April and May of CY22 were 40% higher than the figure recorded in the same months of CY19.
“It’s a very encouraging sign as our losses have been very large (due to Covid-19). Now the recoveries are quite strong. Secondly, volumes are much higher now than CY19 and rates also continue to rise increase,” Dhawan said.
In a recent report, HVS Anarock said India’s hospitality sector ended CY21 with nationwide occupancy of 42-45%, up 10-13 percentage points year-on-year, driving a 24 to 27% increase in RevPAR (revenue per available room). It expects nationwide occupancy to improve to 66% and ARR (average room rate) to increase by 28% in CY22.
With international flight services only recently resuming in March, Dhawan said despite no business or leisure travel to India, the hospitality industry is doing much better occupancy rates in CY22 than CY19, indicating that domestic demand is very strong.
“A few segments are causing this. There is a demand from businesses. The demand for b-leisure (business and leisure) is still there. In addition, the stays continue. Even weekends are stronger now compared to CY19,” Dhawan said.
Also, the wedding segment has witnessed tremendous growth in India. “We will be hosting almost a hundred weddings in CY22 at Fairmont Jaipur. In CY19, we held around 70 weddings there. We are also seeing huge demand at Raffles Udaipur for buyout wedding events,” he said.
Currently with nearly 8,000 employees in India, Accor also plans to hire more people as it expands its network.
“The company is constantly hiring people for the hotels it plans to open this year,” Dhawan said. Accor is hiring nearly 300 people for the Novotel hotel which will be born in Bombay, nearly 150 for the Ibis Hebbal and a hundred for the Ibis Thane.