Optimal time to open, grow hospitality brands in India: ITC Hotels MD

Heightened investor interest and evolving customer needs have made it the optimal time to open and expand new hospitality brands in India, said Anil Chadha, managing director at ITC Hotels.

"India is going through a phase, and it's not just large corporates and big-ticket investors who would be able to afford hotels anymore. A chain like ours straddles across segments to cater to all kinds of customer needs, as they changed post the Covid-19 pandemic,” Chadha told ET in an interview.

“You could build a 50-room or a 30-room hotel depending on the brand and your propensity to earn in a city. If somebody came to us three years ago and said I want you to manage our 30-room hotel, we would have said no. But today, we see a need,” he said.


Cigarette-to-soap conglomerate ITC’s hotel business was demerged effective January 1, spawning a separate listed hospitality entity. Shares of the new ITC Hotels Ltd started trading on the stock exchanges on January 29.

Chadha said ITC Hotels is exploring opportunities to take its famed Bukhara dining brand overseas. It is also in talks to enter the branded residences segment.

“With our quality of service, we can add value to the branded residences space, and we are in discussions. It’s not just about the luxury segments,” he said.

“For instance, we also have our boutique brand Storii as a concept, and we are exploring if we can build Storii villas around a Storii property. In the Welcomhotel space, we are exploring opportunities for residences,” he added.

ITC Hotels reported consolidated revenue from operations of Rs 816 crore for the quarter ended June, up 16% year-on-year. Profit surged 54% to Rs 134 crore.

Chadha highlighted the company’s improving operational performance.

“This applies to occupancies, average room rates, and commanding a much better revenue per available room. For domestic owned hotels, our occupancies have improved from 62% in quarter one of financial year 2024 to 73% in quarter one of financial year 2026,” he said. “In terms of our revenue per available room performance across markets, as per CoStar data for year to date May 2025, for our domestic owned hotels in the luxury, upper upscale and upscale segments, ITC Hotels is commanding a premium of 34%.”

New ITC hotels will be opened in locations such as Kochi, Jaipur, Gwalior, Bhopal, Bodh Gaya, Udaipur, Rishikesh, and Wayanad this year. Chadha said the newly-opened ITC Ratnadipa in Sri Lanka has received a positive response, and that the company is now getting leads for more hotel opportunities in the island nation.

“We have a small Fortune hotel in Nepal, and have signed another Welcomhotel about seven months ago. We are also exploring opportunities in the Middle East,” said Chadha.

He said ITC Hotels has a very strong zero-debt balance sheet and is open to both inorganic growth opportunities and acquisitions.

Chadha acknowledged that while competition has been on the rise, and everybody is “fighting for the same piece of cake”, the chain’s strengths are “clearly understood.”

“Bharat Mandapam is a great example of that. It was an open offer. Anybody could have bid for it, and people did, but we have won the catering bid, and we catered for a prestigious event like the G20. Be it our food and beverage credentials, our sustainability benchmarks, our people, our distribution edge or our loyalty, we have defined our swimming lanes beautifully and people recognize that,” he added.

ITC Hotels currently operates over 140 hotels with over 13,400 keys, with an owned and managed keys mix of 42% and 58% respectively. By 2030, the chain aims to have 220 hotels, with over 20,000 keys, targeting an owned-managed keys mix of 30% and 70% respectively.

The company said it has a pipeline of 58 hotels with over 5,300 keys with high salience of brownfield assets. The hospitality chain said during the quarter ended June 30, the board approved a capital expenditure of Rs 328 crore for construction of a new hotel in Visakhapatnam, Andhra Pradesh. That hotel will come up in financial year 2029. "We have said that an estimated 8-10% of our revenue will be spent towards renovation, ongoing projects and new greenfield projects. We have our owned 118 rooms hotel getting built in Puri. We are adding inventory in Bhubaneswar," said Chadha. For ITC Ratnadipa's serviced apartments component, the chain will start the handover in the second half of this fiscal.

He said operational synergies with the parent company for verticals such as food tech will continue and the food and beverages segment has been the mainstay of ITC Hotels and that it continues to grow. "I am very confident about this space. From 2019-2020 to 2025-2026, we have seen a 1.7 x growth. Even after a great year last year, in 2024-2025 we saw a 13% growth. We have built some world class brands, be it Bukhara, Dum Pukht and Avartana, and almost 40% of our food and beverage revenue comes from banqueting. We are very strong on that," he added.

He said for brands such as Storii and Fortune, the chain is open to exploring franchising opportunities. "For hotels under brands such as ITC and Mementos, people need our expertise. I believe that while numbers are very critical, expansion and growth can't come at the cost of quality and values. There is a saying that quality is remembered long after the price is forgotten. The projects have to align with our brand architecture and values," he added.