![The President, Smt. Pratibha Devisingh Patil presenting the Padma Vibhushan to Shri P.R.S. Oberoi, at an Investiture-I Ceremony, at Rashtrapati Bhavan, in New Delhi on May 05, 2008. [Image: Press Information Bureau on behalf of President's Secretariat, Government of India]](https://images.moneycontrol.com/static-mcnews/2022/05/Biki-Oberoi.jpg?impolicy=website&width=350&height=195)
Hoteliering is a terribly tricky business. The good days are rarely mentioned. But one bad moment, an incident in the night club or a spider in the room, can get magnified to a point where the hotel’s reputation takes a serious hit. That the Oberoi group has been able to hold on to its sterling image for over eight decades is amazing. That it has done so while competing with the best in the world is to the credit of nonagenarian Prithvi Raj Singh Oberoi who just retired after 20 years as the Executive Chairman of EIH Limited, the flagship company of the Oberoi Group.
His exit at a time when the group is coming off two years of financial distress brought upon by the pandemic shouldn’t deflect from his many achievements, none more significant than the premium attached to the brand.
It is a sobering thought that Oberoi, popularly known as Biki, started his journey in the midst of storm clouds and is exiting in similar conditions. In 1984, a particularly tumultuous year for India following the assassination of Prime Minister Indira Gandhi, Tilak Raj Oberoi, the eldest son of the legendary Mohan Singh Oberoi passed away. Quite suddenly Biki Oberoi was the man in charge. He was 40 and had travelled extensively, soaking in lessons from the best hotels in the world. But he had big shoes to fill. His elder brother, popularly called Tiki, was considered to be doing a fine job of building the chain at the time of his premature death.
Even more formidable was the reputation of his father, Rai Bahadur Mohan Singh Oberoi, who was a true pioneer. In 1934 he started the family business with The Clarkes Hotel by mortgaging his wife's jewellery and all his assets. Just four years later, with Calcutta in the grip of a cholera epidemic, he spotted an opportunity and signed a lease to take over operations of the 500-room Grand Hotel. It was a risky bet, but one that would pay off handsomely when The Oberoi Inter Continental came up in New Delhi in 1965 followed by the Oberoi Sheraton in Bombay in 1973.
For the younger son these were years of learning, so when the moment came he was ready. The new inheritor took his role seriously and set about leaving his own stamp on his inheritance. Displaying exemplary foresight, he had set up The Oberoi Centre of Learning and Development at New Delhi. It would go on to become a kindergarten for the best in the business whether they worked with the group or elsewhere. It was an early glimpse into his style of management.
Indeed, for a man who’s grown a fledgling hotel chain into a global powerhouse spanning 33 hotels, two Nile cruisers and a motor vessel in the backwaters of Kerala, Biki Oberoi is best remembered for the small things like the choice of cutlery or the bathroom fittings and the obsession with customer satisfaction, rather than grand corporate moves. There was of course no shortage of those, but his style was always to leave decisions about acquiring and new properties to empowered executives while focusing on the fundamentals.
The attention to detail has paid off allowing the Oberoi brand to hold its own against competition from the likes of Four Seasons in Mumbai and Shangri La in Delhi.
But the neglect of the bigger picture and the external forces at work, did extract a price. ITC, a key rival, built a 14.9 percent stake in EIH after 2000. Then in 2009-10, Max India founder Analjit Singh picked up 9 percent of the company. Both the deals ended up souring relations between the companies. In 2010 to ward off the threat from ITC, Oberoi sold a 14.8 percent stake in the company to white knight Reliance Industries (RIL) which subsequently upped it to 18.85 percent.
Today the promoters have a 35.74 percent stake in EIH while others including RIL and ITC together hold 36.94 percent. Institutions, funds and the general public hold the rest. A major rival such as ITC having such a large holding can be a nightmare for any promoter.
For Biki Oberoi’s son Vikram, the company’s managing director and chief executive officer, and his nephew Arjun, who was appointed in his place as Executive Chairman, this will be the biggest challenge going forward. It is also the one blemish in Biki Oberoi’s rich legacy.
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