Exploring latent possibilities

While admitting that India has immense opportunities in terms of travel and hospitality, Peter Leitgeb, president and CEO of The Claridges Hotels & Resorts, cautions that infrastructure and high costs may force business to take a diversion. By Praveen K Singh

Peter Leitgeb President and CEO The Claridges Hotels & Resorts

Despite all the clamour about the recession the American economy is beginning to witness, Peter Leitgeb feels that India is not about to feel the heat. "Based on our last quarter results, I would say that we will not witness any slowdown," he says.

He has his reasons. For one, the aggressive Incredible India campaign that is helping the hospitality industry achieve its target of number of visitors, specifically for boutique hotels. "We are witnessing continued interest in both the corporate and leisure segment," claims Leitgeb.

This is complemented with international carriers including India in their network and increasing capacity in their business and first class. This, he says, is helping hotels tap that particularly lucrative segment. "A wonderful example is the introduction of Lufthansa's very first Business Jet flying Frankfurt to Pune thrice a week," Leitgeb points out.

But, he cautions, India needs to be careful with regards to the pricing strategies in order to avoid being branded as an expensive destination, which might result in travellers looking elsewhere like Thailand, Philippines or Malaysia. Leitgeb says, "We cannot ignore the drawbacks that India suffers from. We still lack sophisticated infrastructure such as airports, roads and railways. But since India managed to get only 5.3 million visitors last year there is still a lot of untapped market, which needs to be addressed." By comparison, destinations such as Hong Kong, Macau and Spain receive well over 15 million visitors a year. He is therefore optimistic that the government's target of getting 10 million visitors by 2010 can be easily accomplished.

Speaking about manpower shortage, he feels that recruitment and extensive and regular training is key to retaining people. "Also, going for enhanced salary schemes and offering benefits to the lower and middle management will go a long way," Leitgeb says.

Vision for the company

With an aim to expand in city centres and resort destinations, in India and abroad, The Claridges Hotels & Resorts is outlining its position on the Indian hospitality map. Leitgeb says, "In terms of positioning of the hotel, we have progressed significantly, especially with our flagship hotel - The Claridges, New Delhi. We have repositioned it as a premium boutique hotel and we can see the change in terms of the business coming to us from different market segments. What helped us further in repositioning our hotels is the alliance with WORLDHOTELS."

Two of its hotels - The Claridges, New Delhi and The Claridges, Surajkund (opening by this October) - are members of WORLDHOTELS Deluxe Collection while its Atrium Hotel & Conferencing is a member of WORLDHOTELS First Class Collection.

In the fiscal year 2007-08 The Claridges Hotels & Resorts claims to have registered growth of 40 per cent over previous year 100 per cent over last year in terms of GOP. Leitgeb adds, "I feel very strongly about the current fiscal year, particularly the business coming from Europe, specifically the German-speaking market."

He therefore believes that The Claridges Hotels & Resorts has to be present in India's key business and leisure destinations. "In that regard we are currently discussing The Claridges properties in Hyderabad, Chennai and Kolkata and resort properties in Jaipur, Udaipur and Kerala. In autumn 2008, we will unveil The Claridges, Surajkund in Delhi NCR. The hotel will have 204 rooms and 40 serviced residences along with a huge banqueting and conferencing space and 15,000 sq ft of spa," he reveals.

He predicts continuous growth in the neighbourhood of 15-20 per cent per annum. This optimism is shared by a number of international hotel companies that are due to enter India in their respective segments and categories, he affirms, adding that other than growing in India Claridges is currently pursuing expansion opportunities in Maldives and the UAE market, which Leitgeb feels have tremendous growth opportunities.