Pride Group of Hotels, which owns a chain of upscale mid-market and business hotels is in advanced stages of negotiations for setting up a series of new properties, which will see an investment of Rs 1,000 crore over the next few years.
The company, which is promoted by the Rs 3,000-crore S P group of companies — engaged in the business of hospitality, construction and financial services, plans to have a mix of owned and managed properties for opening 3,500 rooms by 2015-16.
The new properties will be opened in Mumbai, Goa, Alibaug, Delhi, Mysore, Coimbatore and Chandigarh, to name a few. The company intends to focus on the tier-II and tier-III markets for the Biznotel brand, a budget and limited business-specific brand.
Pride Hotels Managing Director S P Jain said, “We recently opened our twelfth hotel in Kolkata which we had purchased in 2010 in a half constructed form. The property will be a four-star plus. In addition, construction of a Pride Hotel in Mumbai is expected to begin soon.”
The company opened its first property in Eastern India with the launch of 153-rooms upscale mid-market hotel in Kolkata this month. It has invested Rs 100 crore to set up the Kolkata property that will be fully operational from March 2012 as per a report in Business standard by Swaraj Baggonkar.
Pride Hotels had the regulatory approvals in place for an initial public offering (IPO), which got lapsed a few months ago. The company, along side three other companies, decided not to go ahead with the fund raising plan due to frail market sentiments. It is now looking at its own internal resources to fund the expansion in addition to debt. About 50-55 per cent of the funding will be done via internal accruals.
"We have a small debt on our books, of about Rs 80-90 crore. This leaves us more room to raise further funds through debt,” added Jain.
The Biznotel brand will see an addition of around 11-12 properties over the next three or four years. The company aims to tap into the growing need for standardised rooms in tier-II and tier-III markets where average consumer spend is around Rs 3,000-4,000 per night.
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