Future ready for rising India

Hilton has a rich history of over 100 years. With 18 brands and over 7,000 hotels across the world, it is well positioned to spread the light and warmth of hospitality to different segments of consumers across markets. It has the most exciting hospitality brands in the world with an incredible culture and has been consistently voted as one of the best companies in the world to work for.

However, until around 2005, Hilton International and Hilton US used to be two separate companies, operating as distinct businesses. Hilton entered India with a partnership with Oberoi hotels and all Trident hotels were co-branded as Trident Hilton. A few years later, Hilton US and Hilton International merged as one company and was acquired by Blackstone and began a massive expansion ramp up around the world. That’s when the tie-up with DLF happened for the development of over 100 Hilton Garden Inn hotels in India. This was a JV with a multi-million investment from Hilton.

The fallout of the entry of other Hilton brands into India was the termination of the Oberoi partnership and it was unfortunate that this dovetailed with the global financial crisis in 2008 which had dramatic impact on the real estate sector in India and it further led to the dissolution of the DLF-Hilton JV as well.

During global recession, India’s domestic growth story was fairly insulated in comparison to the rest of the world and new hotel development was on the rise to meet the needs of the growing market. Thus, despite recognising very early the size and importance of the Indian market, Hilton missed out on capitalising on the India opportunity in the early years. “Over the last five years, we have been heavily over indexing and concentrating on India,” shares Navjit Ahluwalia, Senior Vice President and Country Head – India, Hilton.

Firmly committed to the India story, Hilton has built a great operating company in the country, aimed to get the brand the same recognition here as it has overseas. “We are committed to India as we believe that over time it will be the third largest lodging market in the world. Hilton is the fastest growing hotel company in the world and even though we may be small in size in India today, the growth we see for our brands in India is gargantous. This growth will continue to happen over the next few decades, and we are very much focussed on growing in the right locations with the right partners. This enables us to keep investing and adding resources as also ensuring that we are able to provide great returns for owner with a premium in market share. In comparison to our competitors, we have invested heavily in resources for our hotels. As the market in India grows and adds new customers every day, we plan to bring in brands like Waldorf Astoria and Curio here amongst many more” he says.

At present, Hilton has 24 operating hotels, 4,220 rooms across five different brands (Conrad, Hilton, DoubleTree by Hilton, Hilton Garden Inn, Hampton) in India with 14 under development and about 10 under discussion. “We hope to double our portfolio by 2027. We will certainly bring in Hampton on a large scale in short- to medium-term and are in discussions to get Waldorf Astoria, Canopy and Curio too. If there’s a multi-unit opportunity, there’s Hampton Inn and Motto. We are under-represented as far as Hilton is concerned and have the opportunity with our core brands – Hilton Garden Inn and DoubleTree by Hilton –  that we don’t need to go out and look at bringing in more brands until we have populated Indian cities and leisure locations with them. We are focused on planning our growth across major cities and locations with these brands. Moreover, we are a management company and have to be opportunistic while being strategic. If an opportunity comes up that allows us to do something we hadn’t thought of, we will be flexible to consider it,” explains Ahluwalia.

Initiatives and strategies

Over the last two years, everyone in the hospitality industry was equally impacted in a terrible way. “No business is used to going down to zero revenues which we witnessed. We reacted quickly and pivoted to domestic businesses and segments that were still using hotels such as pharma, defence, social weddings and staycations etc. We were nimble and stayed ahead of the curve and innovative. Whether it was launching the Hilton Wedding Diaries or the Wakao Food Festival, all our campaigns were a success and we punched above our weight category by innovating and reacting to the market situation quickly,” he says.

While Hilton globally had to cut down a third of its workforce, the same didn’t happen in India at the corporate level. “We believe in the market’s long-term potential and stayed on the course by maintaining our team, but we couldn’t take this down to the hotel level as we are governed by different owners who reacted differently to the pandemic depending on their individual financial situation,” explains Ahluwalia.  

Current scenario

The nation, feels Hilton’s India Country Head, reacted very quickly when the markets went down and everything was shut during the pandemic. “We saw it react faster than the previous wave and this time, we are back. We are back to the 2019 levels. In some hotels, we are ahead of the 2019 levels. Now we’re slowly witnessing the corporate returning and feel confident of reaching 2019 levels by year-end. The next two to three years are going to be very good for the travel and hospitality business as people have realised that memories are made with travel. People want to make the most of travel restrictions being lifted and travel to experience new destinations, cultures and make new everlasting memories with friends and family. I think the direct correlation to that, from that one perspective, is going to be that people are going to be undertaking revenge travel,” he avers, adding there’s never been a better time for hospitality.

Opportunities in Indian market  

There’s no better place in the world to be than India, feels Ahluwalia. “The largest democracy in the world is on its way to tripling its GDP and will be the youngest nation in the world by 2050. We have only ourselves to see how better we can be with this opportunity,” he opines and we are confident that scale in India will come if you focus on delivering great quality hotels which perform at above market premiums. “We are future ready for rising India,” he says.  

Talking about their brand portfolio in India as compared to other leading hospitality chains, Ahluwalia shares, “Across all levels of completion, we are in the scale of 50 hotels in India. We are 20-30 per cent behind other global hospitality companies operating in India. Hilton invested $100 million in 2006 into India and showed the company’s commitment to the country but there were issues, like the 2008 financial crisis. Today, Hilton is even more committed to India. It is probably the only market where we will deploy significant capital to grow. One needs to have more short-term and mid-term planning,” he shares, adding they follow both, managed and franchise options.

“There is a high degree of managed and a fair degree of franchise hotels. Hampton and Hilton Garden Inn are probably more suited at the early stages to franchise as they are easier to operate and when they mature, there are seasoned operators like Hilton and DoubleTree. India is a nation of entrepreneurs and currently in our managed business, ownership involvement is significant. By 2050, India is going to replicate the US as a large franchise market because we have an entrepreneurial culture, with owners taking great interest in the assets. I feel the growth of the franchise business in India will far outweigh the growth of managed business, but both will have space and operate both models successfully,” says Ahluwalia.  

Significance of sustainability

Talking about cutting down the environmental footprint to half by 2030, Ahluwalia says, “We are focussing on sustainability in every facet, from the time we construct a hotel as that’s how one builds a LEED-certified property. We want to be zero plastic and use sustainable ingredients bought from close vicinity. Then, be energy efficient at all ends. To reduce wastage, small soaps and shampoo bottles have been replaced by larger ones and every hotel has a target to work closely with the community to give back a significant portion of our profits – be it providing employment to families close by or working with schools and training children” he informs.  

Expansion plans

There are a lot of opportunities in the bigger cities and those are the markets we want to plant a Hilton flag, shares Ahluwalia. “People want to see us in key getaway locations first. Unless it is a great opportunity that we can’t miss, our focus is the main cities,” he says.  

Personal note

Ahluwalia feels that you must do what makes you happy and serves a purpose in your life. If you are passionate about something, working hard at it becomes easy, long hours don’t seem long anymore. I love the hotel business, it gives me great energy to be able to see how our hotels can contribute to changing city skylines, helping thousands of team members grow in their own aspiration and be part of something much bigger than myself by making sure our hotels become part of their communities.