Bangalore-based hospitality chain, Royal Orchid Hotels Limited, is looking at liquidating more assets to reduce its Rs 160-crore debt, according to chairman and managing director Chender Baljee.
“We are not desperate to sell our properties. We, however, don’t mind liquidating assets to reduce some of our debt. We are open to selling a couple of properties, including one in Bangalore, if it gives us a huge upside. We would look at cases where we can retain the management,” he told Business Standard.
The company had, in April this year, sold a hotel property in Ahmedabad to Gurgaon-based SAMHI Hotels for Rs 67 crore as a part of its debt reduction plan.
Announcing the launch of Re:gen:ta One, the company’s five-star hotel property here on Tuesday, Baljee said their hospitality-cum-residential project at Dar-e-Salaam in Tanzania would be up and running in two years from now.
Royal Orchid had acquired a 30-acre prime beachfront property in Dar-e-Salaam from Tanzania-based Multi Hotels for $2 million in 2007. The company has kept its maiden foreign venture on the back-burner for the last four years to focus more on its Indian projects.
“We will be coming out with an estimated financial plan in the first week of September. Construction work on the resort property, which will house a 150-room five-star hotel besides 100 villas, will start sometime this year,” he said, while declining to comment further.
Stating that the company’s focus was now on management contracts, Baljee said having achieved a pan-India presence, it planned to have 4,000 keys (rooms), from the current 2,200, by 2015 through owned properties, leases, management contracts and joint ventures.
Royal Orchid, which currently has 23 hotels in 16 locations across the country, reported revenues of Rs 180 crore in the financial year ended March 2012. According to Shekhar Bhargava, executive vice-president of Royal Orchid, the company has a budget of Rs 220 crore for this year.
Re:gen:ta One, built with an investment of Rs 230 crore, has 154 rooms and four suites. The UN Convention on Biodiversity, which will kick off in Hyderabad in October, would help the property meet all its operational commitments this year and interest commitments by next October, Baljee said. Royal Orchid’s scrip ended the trade at Rs 44.75 on the Bombay Stock Exchnage on Tuesday, up 0.56 per cent over the previous close of Rs 44.5.