Very Bullish About the Future in India

Neeraj Govil took over as the Market Vice-President South Asia, Marriott in September 2015, but he is an old hand in the group. Govil joined the group first, soon after graduating from the Institute of Hotel Management and Catering Technology in Goa, with a stint at the Renaissance Goa, which is now shut, before ending up working in F and B at the Renaissance Mumbai Convention Centre Hotel in 2001, looking after restaurants, banquets and events at the hotel. 2006 onwards, Govil worked on a number of assignments with Marriott International in Australia, Vietnam and China. 

“I think the experience of working across the different markets from India to Australia to SE Asia to China really adds to your wealth of experience. When this role came up in India, I thought why not and walked into this role in September last year,” Govil said. 

Govil’s role involves marketing, operations, finance and of course growing the portfolio in India, Maldives, Sri Lanka, Bangladesh and Nepal. The current India portfolio, has 33 operating hotels and a further 50 odd hotels in the pipeline. This year (and for Marriott, this means calendar year), four hotels have opened already--The Courtyard by Marriott and Fairfield Marriott in Bengaluru; Courtyard Marriott in Raipur and the Pune Marriott Suites. 

“I am scheduled to open a minimum of seven more hotels in this calendar year. I am expecting our operation portfolio to go from 33 to 40 by the end of this calendar year within the Marriott umbrella itself. There’s a lot of action that we are expecting. We are pretty busy extending our footprint beyond India as well. We are looking to open our first hotel in Kathmandu Nepal, in Sri Lanka and Dhaka, Bangladesh over the next 12 months,” Govil told us. 

Though all the openings happening this year so far were of new builds, the group was also looking into options of taking over existing properties in their scheme of things, Govil told us. “If there are conversions that come our way, we are not averse to looking at those if the terms are favourable,” he said. 

The group have seven brands operating in India, the top of the line Ritz Carlton and JW Marriott; full service Marriott and Renaissance; and the more mid-segment Courtyard and Fairfield by Marriott hotels.  

“When you look at it, the brand which is gaining the maximum traction is Courtyard. Interestingly in the next 12 to 18 months there will also be a substantial edition to our Fairfield hotel portlio,” Govil said, adding that many Fairfields will open in smaller locations, this year, with new properties in Lucknow, Indore, Amritsar, Belgaon and Jodhpur. 

“For us, sustainable growth is as important as accelerated growth and one of the things that we look at is that the market is ready for the brand. Currently we have approximately 7500 + hotel rooms across India. The hotels that I have all mentioned will take our inventory up by approximately 1400 rooms. We are talking about 9000 rooms,” he said about the growth this year for the Marriott group in India.

Govil felt that the company was very bullish on market sentiment, whether looking at the short, medium or long term. The hotel sector is in very early stages of an upswing, with three consecutive quarters of good high double digit growth, he felt the things were going to get stronger and see further consolidation in 2016-17. 

“Brand India today is pretty attractive globally. Indications are that the Make in India campaign is gaining traction. We are attracting more foreign and domestic investment. Infrastructure spending it up. Domestic travel, a key indicator for the hotel sector is up,” he said. 

Added to that the projected growth of India’s GDP and Govil could not help but feel very bullish on the short and medium term for the hotel sector.

“Our occupancies have seen substantial improvements. Our average rates in terms of markets have also moved in the right direction. Cumulatively we have seen high double digit rev par growth across three consecutive quarters,” he added. 

With most of the company’s inventory in the larger metros, cities like Mumbai, Pune and Bengaluru were also extremely important for the group’s performance, he said.

“There is great potential in the market, provided we are able to go after the right source markets and attract the right business in our hotels. As long as we manage our business sustainably, we will be getting great returns and delivering premiums to our owners and our partners,” he said adding that the good news was a large proportion of Marriott’s partners-- given India’s geographical spread, partnerships are more regional in nature--have multiple projects with them.