Power List 2017, Ajay Bakaya, MD, Sarovar Hotels and Resorts
News of France-based Louvre Hotels Group (LHG) acquiring a majority stake in Sarovar Hotels & Resorts broke a lull that had existed in the Indian hospitality industry for months. This tie-up also opened new doors for Sarovar in terms of distribution channels and global synergies with a large hotel group.
Usually, M&As of this scale lead to some operational turbulence, however, Ajay Bakaya maintained that the transition was seamless across the brands. In fact, he seemed excited, as this alliance would provide the company better opportunities to take the Sarovar brand to other regions overseas.
“Over the past year, we signed seven new hotels and successfully opened five hotels – RBD Sarovar Portico, Bengaluru, RS Sarovar Portico, Palampur, Efcee Sarovar Portico, Bhavnagar, The Lazizi Premiere, Nairobi and Panorama Sarovar Portico, Juba in South Sudan,” he pointed out.
When asked whether the backing of Louvre helped in the these openings, Bakaya stated, “We always had a healthy pipeline as our main focus has been on business development. Our association with LHG will definitely supplement our ongoing efforts in this direction.”
Earlier this year, Sarovar Hotels announced the overseas debut of its value brand, Hometel, with the signing of a hotel in Nairobi. According to Bakaya, the mid-market and budget hotel segment in India and globally has the maximum potential given high demand from business and tourism sources. “Developing luxury hotels comes at a huge CAPEX and longer gestation periods as compared to mid-scale budget hotels. The demand of mid-range economy hotels has been increasing steadily globally over the past decade,” he pointed out.
Currently, Sarovar manages around 75 hotels in over 50 destinations and has around 5500 keys in India, under Sarovar Premiere, Sarovar Portico and Hometel, brands. Additionally, it has around 510 operational rooms in Africa.
Talking about changes underfoot in the industry, Bakaya believes that innovative use of technology will benefit hotel chains stand out from the competition. He also foresees challenges arising due to the disruptive distribution strategy of online travel portals, which is leading to shift in the traditional booking source and is increasing hotels’ distribution costs.
By Vinita Bhatia