The Indian economy might have slowed to a crawl but there is one sector where fresh investment is showing no signs of slowing down — the hospitality industry. Over the next three or four years, an additional 93,000 branded rooms will hit the market. To put this number in perspective, the current branded room inventory in the country is estimated to be around 84,000.
Almost every big hotel brand in the world is setting up operations in the country. But they are not the only players in the game. Private equity players have got into the hospitality market as have half a dozen entrepreneurs who are creating their own brands. There are also the real estate moguls who are building grand hotels, but letting big hotel brands manage them. A number of consultants have cropped up to play matchmaker between people with land, people with money and people with hotel brands or hospitality expertise. There are marriages, divorces and remarriages happening at a furious pace.
In terms of pure economics, the hospitality business is not one with huge profit margins. The addition of all these rooms will only put more pressure on bottomlines. But there is a certain glamour about the whole business which seems to attract more and more people. Senior associate editor Chitra Narayanan spoke to dozens of players to put together our cover story on The Great Hotel Swayamwara. She has also profiled some of the more interesting middle-market players.
The last fortnight saw a number of events that raised questions about propriety, conflict of interest and corporate governance. Take the IPL affair, for instance. What initially looked like an isolated case of some players taking money from bookies to throw games has now become a scandal involving some of the best players, administrators of the game, team owners and even some actors. If the police are to the believed, the underworld also has a hand in the betting racket. The sums involved run into hundreds of crores of rupees.
Questions have been raised about Board of Control for Cricket in India president N. Srinivasan refusing to resign despite the arrest of his son-in-law in the match-fixing scam.
Meanwhile, there have been many reports about the conflict of interest that Indian cricket captain M.S. Dhoni is facing. Predictably, Dhoni has refused to make any comment on the matter.
Senior associate editor Gurbir Singh writes about the way the IPL controversy is unravelling.
Twitter: (at)prosenjitdatta(This story was published in BW | Businessworld Issue Dated 01-07-2013)