Expect H2FY10 rev to be double of H1: Royal Orchid Hotels

Q: What is the occupancy rate in January and how has it improved now? What is the average room rate (ARR) for January and now?
A: January had the twin effects of corporate slowdown as well as the terror attacks. Hence, we were quite low in January. Most hotels were at 30-40%. Now we have seen quite a bit of an up tick and most of our properties are in the range of 70% in terms occupancy.

On an average, we run 13 hotels which are three-four star and we have one five star hotel currently. So the ARRs, in January, were about Rs 3,500 which has now gone up to Rs 4,700- 4,800.

Q: Is there an improvement from second quarter to third quarter?
A: The third quarter is now looking much better. The first two quarters were essentially washed out.

Q: Bangalore is seeing a surfeit of rooms. You may have improved till the second quarter, but is third quarter under pressure?
A: Since October, things have really been on an uptick because traditionally that is our season. However, we find this month terrific for us. We are finally back to numbers which we are comfortable with. We faced biggest amount of pressure in Bangalore. In certain cities like Pune, we did not face any pressure at all because they were not IT dependent. However, Bangalroe has been hit because it was dependent on IT sector and IT has had two good quarters now. Hence, travel has gone up.

Q: You have many new projects lined up in FY11. How do you plan to fund them?
A: We have a five star hotel coming up in Hyderabad and one in Jaipur. These two projects will open in October 2010. The equity portion has already been funded by us through internal accruals and some of our initial public offering (IPO) proceeds. The rest is debt which we have tied up with the consortium of banks. We have a management contract of project opening up in Navi Mumbai which will open up in January. We have completed a project 104 room four star in Ahmedabad, which is ready and will launch any day.

Q: Could you give us some numbers in terms of what revenues you might do in second half compared to first half? What will you do in terms of bottomline?
A: In terms of bottomline, we are at closing in the range of Rs 8-10 crore. The net income for this year will show that the second half is almost double of what we have done in the first half. We are looking at similar revenue numbers. We are looking at second half to almost double than what we done in the first half. Hence, it has been quite a bit of an uptick.

Q: What about your joint venture (JV) with Amartara?
A: Last week we purchased 53% of a company called Amartara Hospitality in Mumbai. We paid Rs 18 crore to acquire a piece of land where we will be building 250 room four star hotel in Powai. We hope that this will mark a very impressive and big entry into upcoming suburb in North Bombay.