Detailed Project Report on 3 STAR HOTEL (200 ROOMS)

The hospitality industry in India has been scoring a moderate growth number in the past few years and has great potential to score an even greater number in the future. The nation which is rich in culture and diversity has been attracting a large number of tourists from all over the globe. India has also been recognized as a destination for spiritual tourism for international and domestic tourists. India is showing continuous growth in position moving from 65th in 2013 to 34th position in 2019 in the World Economic Forum's travel and tourism competitiveness index.

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ENGINEERS INDIA RESEARCH INSTITUTE
4/54, Roop Nagar, Delhi-110007 (India)
Phone: [phone]
E-mail: [email protected]
Website: www.eiriindia.org



3 STAR HOTEL (200 ROOMS)
[EIRI/EDPR/4675] J.C.: 2892XL

The hospitality industry in India has been scoring a moderate growth number in
the past few years and has great potential to score an even greater number in the
future. The nation which is rich in culture and diversity has been attracting a
large number of tourists from all over the globe. India has also been recognized as
a destination for spiritual tourism for international and domestic tourists. India is
showing continuous growth in position moving from 65th in 2013 to 34th position
in 2019 in the World Economic Forum's travel and tourism competitiveness index.

On the other side, the consistently growing middle class, rising levels of disposable
income, and increasing interest among millennials to travel in their home country
are a few major reasons that are making the domestic travel industry a profitable
one. To attract the millennials ventures like Airbnb, Oyo rooms have changed
hospitality scenarios on a global level and are offering price-sensitive stays in most
of the prime locations with flexible check-in and check-out options to attract the
increasing number of travelers.

The hospitality and tourism industry has been witnessing a healthy growth
number and accounted for 7.5% of the GDP. India is a part of the top 100 clubs
on Ease of Doing Business (EoDB) and ranks 1st in the greenfield FDI ranking
globally and to strengthen the cruise tourism sector, the Government of India
(GoI) has selected Chennai, Goa, Kochi, Mangalore, and Mumbai ports to develop
them as cruise tourism hubs. These terminals will have facilities like hospitality,
retail, shopping, and restaurants.

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CONTENTS


INTRODUCTION
THE GLOBAL HOTEL MARKET
HOSPITALITY INDUSTRY IN INDIA MARKET
GOVERNMENT INITIATIVES TO ATTRACT MORE T OURISM AND RISE IN
TOURISM IS DRIVING THE MARKET
FACILITIES AND SERVICE REQUIRED FOR 3 START HOT EL CLASSIFICATION
GENERAL FACILITIES FOR 3 STAR HOTEL:
GUEST ROOM FACILITIES FOR 3 STAR HOTEL
REQUIRED BATHROOM FACILITIES FOR 3 STAR HOTEL
PUBLIC AREA FACILITIES FOR 3 STAR HOTEL
ROOM AND OTHER FACIL ITIES FOR THE DIFFERENTLY ABLED GUEST
FOOD AND BEVERAGE FACILITIES FOR 3 STAR CLASSIFICATION
REQUIRED KITCHEN FACILITIES FOR 3 STAR CLASSIFICATION
REQUIRED STAFF QUALI FICATIONS, SKILLS AND STAFF WELFARE FOR 3 STAR
CLASSIFICATION
GUEST FACILITIES FOR 3 STAR CLASSIFICATION
SAFETY AND SECURITY FACILITIES FOR 3 STAR CLASSIFICATION
CATEGORIZATION OF HOTELS IN INDIA
THE BASIC DIVISION IN INDIA ACCORDING TO THE LOCATION IS AS FOLLOWS:
HERITAGE HOTELS
LUXURY HOTELS
BUDGET HOTELS
RESORTS
IMPORTANT HOTEL GROUPS IN INDIA
LATEST DEVELOPMENTS
MARKET POSITION
OVERVIEW OF THE INDI AN ECONOMY
INDIA GDP FORECAST

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KEY DEMOGRAPHIC TRENDS
KEY TRENDS IN TRAVEL AND TOURISM IN INDIA
THE TABLE BELOW HIGHLIGHTS THE INDIAN TRAVELLERS SPENDING AS PER
CATEGORY OF LODGING FOR CY 2015, CY 2018 AND PROJECTED SPENDI NG
IN CY 2021:
THE TABLE BELOW PROVIDES THE GROWTH IN COUNTRIES ELIGIBLE FOR E -
VISA SINCE THE YEAR 2014
KEY DRIVERS OF DEMAND AND SUPPLY INFLUENCING THE HOTEL INDUSTRY
HOTEL INDUSTRY SUPPLY SCENARIO
CITY WISE HOTEL SECT OR SUPPLY OVERVIEW
ORGANIZED HOTEL SUPPLY BY MAJOR CITY (2018)
HOTEL INVENTORY SUPPLY BY KEY CITIES (‘000S)
ASSET PERFORMANCE THROUGH THE CYCLE
INCREASING REVPAR ON NEW HOTELS
INDIAN HOTEL SEGMENT ATION
AS ON DECEMBER 31, 2018 THE EXISTING SUPPLY SEGMENTATION OF
ORGANIZED HOTELS IS AS
THE FOLLOWING TABLE SETS FORTH T HE COMPOSITION OF ORGANIZED
SUPPLY (EXCLUDING AGGREGATORS) OF HOTEL ROOMS (000S) IN INDI A:
PRESENCE OF BRANDED HOTELS IN INDIA:
UPCOMING BRANDED HOT ELS IN INDIA:
MARKET PERFORMANCE OF INDIAN HOTELS
PERFORMANCE OF SELECT GEOGRAPHICAL MARKETS IN INDIA
MARKET WISE OCCUPANCY AND ARR
INDIA HOTEL MARKET PERFORMANCE BY SEGMENTS
UPSCALE
UPPER UPSCALE
SUMMARY OF PERFORMANCE OF DIFFERENT SEGMENTS IN THE HOTEL
SECTOR
REVPAR CAGR OF VARIOUS SEGMENTS IN HOT EL SECTOR FOR THE PERIOD
COMPARISON OF OPERATING COSTS OF HOTELS ACROSS SEGMENTS
THE AVERAGE DEVELOPMENT COST PER KEY ACROSS DIFFERENT HOTEL
SEGMENTS IS REPRODUCED BELOW:
BARRIERS TO ENTRY

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DEVELOPMENT OF HOTELS IN INDIA FACES SEVERAL CHALLENGES,
PRINCIPAL AMONG WHICH ARE:
COMPETITIVE LANDSCAPE
TABLE 1: LEADING LISTED HOTEL OWNERSHIP COMPANIES WITH MORE T HAN
1,000 OWNED KEYS, LISTED IN ORDER OF OWNED KEYS (AS ON JUNE 30,
2021)
TABLE 2: AVERAGE KEYS ADDED ANNUALLY* (AS ON JUNE 30, 2021)
TABLE 3: OWNED HOTELS BY LOCATION (AS ON JUNE 30, 2021)
KEY REGULATIONS AND POLICI ES IN INDIA
FOOD RELATED LEGISLATIONS
THE FOOD SAFETY AND STANDARDS ACT, 2006 (“FSS ACT”)
ENVIRONMENTAL LEGISLATIONS
OTHER APPLICABLE LAW
STATE LAWS
MUNICIPALITY LAWS
SHOPS AND ESTABLISHMENTS LEGISLATIONS IN VARIOUS STATES
AIRPORTS AUTHORITY OF INDIA ACT, 1994, AS AMENDED (“AAI ACT”)
EXCISE LAWS
INTELLECTUAL PROPERT Y LAWS
FOREIGN INVESTMENT REGULATIONS
LABOUR LAW LEGISLATI ONS
MACROECONOMIC OVERVI EW OF INDIA
INDIA GDP FORECAST
KEY CHARACTERISTICS OF INDIA’S HOSPITALI TY INDUSTRY
INDUSTRY SIZE – CHAIN AFFILIATED HOT ELS
TOP 10 CHAINS – NUMBER OF HOTELS
ROOMS SUPPLY - BY MARKETS
CHAIN COVERAGE OF ST ATE CAPITALS
CHAIN COVERAGE – STATE CAPITALS
THE LEISURE SECTOR
LEISURE SUPPLY – TOP 5 CHAINS
INTERNATIONAL PRESENCE
MAJOR DOMESTIC CHAINS - INTERNATIONAL PRESENCE AS AT SEP 21
OPERATING STRUCTURES
TOP 10 CHAINS – OPERATING STRUCTURES
FUTURE SUPPLY

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SUPPLY (INVENTORY IN ‘000S)
PROJECTED SUPPLY GROWTH IS REFLECTED IN THE CHART BELOW:
EXPECTED SUPPLY – ALL INDIA, ALL SEGMENTS
DEMAND
FUTURE DEMAND
DEMAND RECOVERY/GROWTH ES TIMATES – RELATIVE TO FY19 DEMAND
SUPPLY AND DEMAND CAGR
OVERVIEW OF SOME KEY IMPACT FACTORS
KEY DEMAND DRIVERS
DEMAND FOR HOTELS ARISES FOR VARIOUS PURPOSES, PRINCIPALLY:
MARKET PERFORMANCE ANALYSIS
ALL INDIA AND KEY MARKETS
QUARTERLY REVENUES – SELECT LISTED HOTEL COMPANIES
CHART 12 – MONTHLY OCCUPANCY AND ADR – JAN-19 TO JUL-21
HOTEL BRANDS IN THE SURVEY
DEVELOPMENT COST PER KEY WITHOUT LAND
DEVELOPMENT COST PER KEY BY MAJOR COST CA TEGORIES
DEVELOPMENT COST PER SQUARE FOOT AND BUILT -UP AREA ANALYSIS
CONSTRUCTION TENURE
INTEREST DURING CONSTRUCTION
AVERAGE
PRINCIPLES OF PROJECT LAYOUT
PRINCIPLES OF PLANT LAYOUT
PLANT LOCATION FACTORS
PRIMARY FACTORS
1. RAW-MATERIAL SUPPLY:
2. MARKETS:
3. POWER AND FUEL SUPPLY:
4. WATER SUPPLY:
5. CLIMATE:
SPECIFIC FACTORS
6. TRANSPORTATION:
A. AVAILABILITY OF VARIOUS SERVICES AND PROJECTED RATES
7. WASTE DISPOSAL:
8. LABOR:
9. REGULATORY LAWS:
10. TAXES:

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11. SITE CHARACTERISTICS:
12. COMMUNITY FACTORS:
13. VULNERABILITY TO WARTIME ATTACK:
14. FLOOD AND FIRE CONTROL:
EXPLANATION OF TERMS USED IN THE PROJECT REPORT
1. DEPRECIATION:
2. FIXED ASSETS:
3. WORKING CAPITAL:
4. BREAK-EVEN POINT:
5. OTHER FIXED EXPENSES:
6. MARGIN MONEY:
7. TERM LOANS:
8. TOTAL LOAD:
9. LAND AREA/MAN POWER RATIO:
ORGANIZATION CHART
PROJECT LAYOUT
CONSULTANT
LIST OF PLANT AND EQUIPMENT SUPPLIERS/MANUFACTURERS
AIR CONDITIONING & REFRIGERATION UNITS
LIST OF DOCUMENTS REQUIRED TO GET FOR LI CENSES
OTHER LICENSES REQUI RED FOR THE SETUP:
SWOL ANALYSIS
STRENGTHS
OPPORTUNITIES
WEAKNESS
LIMITATIONS
APPROACH FOR PLANNING
POWER REQUIREMENT:
WATER REQUIREMENT AND CONSUMPTIONS PROPOSED PROJECT:-
CHARACTRISTICS OF TREATED WATER ARE AS FOLLOW:
SEWERAGE SYSTEMS:
TOTAL SEWAGE PRODUCED –
SEWAGE QUANTITY, TREATMENT, REUSE & DISPOSAL:
SOLID WASTE GENERATION:
ENERGY CONSERVATION MEASURES:
ENERGY CONSERVATION MEASURES & MANAGEMENT PLAN:

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FOLLOWING MEASURES HAVE BEEN PROPOSED TO REDUCE ENERGY
CONSUMPTION FOR ELECTRICAL INSTALLATION:
IMPLEMENTATION SCHEDULE
THE KEY FACTORS THAT WOULD FACILITATE SUCCESSFUL AND TIMELY
PROJECT IMPLEMENTATI ON ARE
IMPLEMENTATION STRAT EGY
IMPLEMENTATION SCHEDULE
PRE-PROJECT ACTIVITIES I NCLUDE:
LOCATION OF THE PROJECT
HOTEL INDUSTRY IN COIMBATORE
TOP STAR HOTELS IN COIMBATORE
PROJECT IMPLEMENTATI ON SCHEDULE
PROJECT IMPLEMENTATI ON WILL TAKE A PERIOD OF 18 MONTHS
LAND & BUILDING
EQUIPMENTS & MACHINERY

APPENDIX – A:

01. PLANT ECONOMICS
02. LAND & BUILDING
03. PLANT AND MACHINERY
04. OTHER FIXED ASSESTS
05. FIXED CAPITAL
06. RAW MATERIAL
07. SALARY AND WAGES
08. UTILITIES AND OVERHEADS
09. TOTAL WORKING CAPITAL
10. TOTAL CAPITAL INVESTMENT
11. COST OF PRODUCTION
12. TURN OVER/ANNUM
13. BREAK EVEN POINT
14. RESOURCES FOR FINANCE
15. INSTALMENT PAYABLE IN 5 YEARS
16. DEPRECIATION CHART FOR 5 YEARS
17. PROFIT ANALYSIS FOR 5 YEARS
18. PROJECTED BALANCE SHEET FOR (5 YEARS)

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COST ESTIMATION

Plant Capacity 200 Rooms

Land & Building (4 Acres) Rs. 57.45 Cr

Plant & Machinery Rs. 31.96 Cr

Working Capital for 2 Months Rs. 6.54 Cr

Total Capital Investment Rs. 121.27 Cr

Rate of Return 16%

Break Even Point 62%