Need to invest Rs 750-2000 cr to grow hospitalty biz: Brigade

Listing of the hospitality business will be done at an appropriate time, he said.Below is the verbatim transcript of MR Jaishankar’s interview with Sonia Shenoy & Anuj Singhal on CNBC-TV18.Sonia: The stock is up 14 percent reacting to this news. Just tell us what the plans are for the hospitality business will it eventually be listed, do you have any kind of monetisation plan?A: Currently, we have 500 operating rooms and we have under construction something like 675 rooms. In addition there will be about 750 rooms which we will start in the next one year or so. Totally we will have about 2,000 operating rooms within the next three years. All this requires additional capital investment. The current decision of the board is to make it in to a subsidiary and invite the private equity investment at the appropriate time to grow the business.Anuj: We were just discussing this with one of our guest that maybe it was a mistake on part of Brigade to get into the hospitality business and there might be a realisation?A: Absolutely not, because the hotels that are operating for the last five to seven years are doing extremely well. We are confident of the hospitality sector that is the reason we would like to grow the business.Sonia: You did mention that you are looking for additional capital investments and you will be inviting private equity (PE) players as well. By when do you hope to raise some amount of funds?A: This is appropriate time; the thing is all this will take couple of months by way of a general body approval.Sonia: How much capital do you need currently for capex?A: Totally our new investments will be in the range of Rs 750 to 2,000 crore. Anuj: Any ballpark stake that you have decided that promoters will retain as of now of course it would be 100 percent wholly own subsidiary but in the hospitality business how much stake will you be willing to partake?A: We definitely would like to retain majority stake.Anuj: You will be willing to sell how much say up to 49 percent?A: It is a bit pre mature but we are quite sure we will be retaining majority. Sonia: Any plans to eventually list the hospitality business?A: At an appropriate time it is too early to say because we are just in the process of making it into a subsidiary. At an appropriate time we should, ultimately if we have a private equity investor there has to be an appropriate exit route for them in years to come. So, it will be a joint decision with the private equity investor.