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Five-star hotel and luxury resort chain, The Leela Palace, will reportedly file its initial public offering (IPO) to raise Rs 5,000 crore soon.

According to a report by Moneycontrol, the luxurious hotel chain will use Rs 3,000 crore for the growth capital and the remaining Rs 2,000 crore with promoter Brookfield looking to dilute stake.

	
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Toronto-based Brookfield Asset Management acquired four of Leela’s assets in Delhi, Bangalore, Udaipur, and Chennai from JM Financial Asset Reconstruction Co in March 2019 for Rs 3,950 crore. The imminent IPO will exclude the Mumbai branch as it is already listed as Hotel LeelaVentureLtd (HLV).

The share sale of The Leela Palace will be managed by eleven investment banks such as Kotak Mahindra Capital, JM Financial, BofA Securities, Morgan Stanley, JP Morgan, Axis Capital, Citi, ICICI Securities, IIFL Capital, Motilal Oswal and SBI Caps.

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Recently, Ventive Hospitality, a joint venture between Pune-based real estate developer Panchshil Realty and global investment firm Blackstone filed its draft IPO documents to raise Rs 2,000 crore.

Five-star hotel chain 'The Leela Palace' to file for Rs 5,000 crore IPO soon: Report

Three-quarters of urban Indians are planning to travel this festive season (between September and December), with millennials leading the trend at 80%, followed by GenZ at 70%, a survey conducted by YouGov revealed.

72% of the surveyed individuals are planning domestic travel while one in ten (9%) are leaning towards international destinations. As many as 19% are considering both domestic and international options, the survey added.

For domestic travel, Goa topped the list at 35%, followed by Kerala at 26% and Himachal Pradesh at 24%. Internationally, the Middle East stood as the most popular choice at 46%, followed by Europe (35%) and Southeast Asia (34%).

Half of those planning trips have identified potential destinations but have not yet booked (51%), while 32% have already made their arrangements.

Most individuals have expressed a preference for shorter vacations during this period, with 47% planning to travel for a week and 34% opting for long weekends of up to three days. About a fifth (19%) are looking at vacations lasting up to two weeks or more.

The surveyed individuals' most preferred platform for booking tickets and hotels was MakeMyTrip, favored by almost 50% of urban Indians. Booking.com stood as the second most popular platform for both flights (25%) and hotels (27%). While EaseMyTrip was the next most popular choice for booking flights, Goibibo was a preferred option for hotels.

According to the report, one in five also consider festive deals on flights and hotels a good reason to travel during this time (19%).

Despite the reliance on booking platforms, 55% of urban Indians have shown preference to make their own bookings. 30% opt for bundled packages through online travel agencies, while 17% use traditional travel agents.

Long weekends are expected to significantly influence travel plans for the upcoming festive season, with 27% of urban Indians considering the extended holidays from September to December as an ideal travel window.

72% of urban Indians planning domestic travel during festive season; Goa tops list: Survey

Riddhi and Aniket, who plan to exchange their wedding vows in December of this year, have started exploring an opulent venue in the mountains to make their special day memorable. "I believe that the hotel industry has evolved extensively when it comes to organizing wedding functions, including the pre-wedding shoot. They make everything so seamless that we don't need to bother about catering, guest rooms, or other services," Subhadra Sharma, Riddhi's mother said.

According to a recent report by investment banking firm Jefferies Group, India hosts approximately 80 lakh to one crore weddings annually. An average Indian spends Rs 12 lakh, or roughly $15,000 on a wedding, the report added. At the higher end, an Indian wedding can run into several hundreds of crores or the size of a small country's GDP.

However, staying on the average big Indian wedding, the hotel industry has witnessed some key changes. 

"Over the years, we've observed a noticeable shift in our clients' budgets. Many are now willing to invest more in creating personalized and unforgettable wedding experiences, prioritizing unique venues, bespoke decor, and tailored services that reflect their tastes and preferences," Amit Damani, founder of StayVista said.

With weddings being one of the major revenue drivers for any hotel, the advertisement and marketing spending on extravagant events have also soared. Harleen Mehta, SVP of Sales, at Lemon Tree Hotels told Storyboard18 that they utilise 2-3% of average revenue to promote the wedding segment using advertisements, fairs, familiarisation trips, and other direct and indirect channels of marketing and promotions.

Avijit Singh from House of Rohet revealed that their marketing budget for weddings is tailored to target high-end clientele seeking luxury and personalized experiences. "Approximately 20% of our marketing efforts are focused specifically on promoting wedding events, including strategic collaborations with wedding planners and digital marketing campaigns".

<strong>'Pre-wedding shoot trends'</strong>

Pre-wedding shoots have soared in popularity as youthful India intersects with a love of online video. The creative shoots have benefited the hospitality sector to a great extent, industry experts told Storyboard18. According to Himadri Bhatt, General Manager, of Niraamaya Retreats Surya Samudra, "Pre-wedding shoots have proven to be a multifaceted benefit for the hospitality industry they act as an organic marketing opportunity. Guests are willing to pay for access to these visually pleasing locations, which, in turn, boosts our income".

"At BLVD Gala, we've noticed a significant increase in bookings that incorporate pre-wedding shoots. The trend has led to creative collaborations with photographers and planners, further enhancing our service offerings," Siddharth Mankani, Managing Director - Embassy Leisure and Projects said.

<strong>'Wedding season revenue'</strong>

The average revenue of hotels varies during the wedding season depending on clients' requirements. According to Singh from House of Rohet, "During the wedding season, both Rohet Garh and Mihir Garh experience a significant boost in revenue." Singh added that on average, his properties see a 35-45% increase in revenue during peak months. 

Lemon Tree Hotels said that each wedding can be anywhere between Rs 10 lakh at a smaller hotel to over Rs 1.5 crore at its higher-end brand Aurika. The numbers vary according to the scale of a wedding and size and class of properties.

The growing popularity of lavish destination weddings accounted for an expenditure close to Rs 3.75 trillion in 2023 across the country. According to industry experts, the bookings from Tier-2 and Tier-3 cities have also escalated, especially after the Covid-19 pandemic and with 'intimate weddings' picking up.

Manish Tolani, Vice President and Commercial Director, South Asia, Hilton said, "Smaller bridal parties and intimate wedding ceremonies have gained traction, benefiting the sector as well. Hotels and event spaces are innovating with unique setups, culinary offerings, and immersive experiences that resonate with couples seeking to make their special day truly memorable, despite a smaller guest list".

Singh also underscored the trend of splurging money on intimate weddings. "In the past year, Rohet Garh and Mihir Garh collectively hosted around seven weddings. And, we have observed a 20-25% increase in spending per wedding, as clients now prefer customized décor, gourmet experiences, and curated entertainment".

Mehta agreed that there has been a significant reduction in wedding size from 500 to 300 people which has encouraged the family to spend more. Besides, multiple functions like 'Roka' and 'Haldi' are also being done at outdoor venues by families, which traditionally used to happen at home, thereby adding to the number of wedding-related events in hotels.

Lemon Tree Hotels' Mehta said last year there were about 70 plus auspicious dates and their hotels with medium to large-sized banquet halls did about 60+ weddings including, pre and post-functions per season.

Wedding Fever: Hotel industry seizes on pre-wedding shoots, nuptial ceremonies to generate revenue

HOSPITALITY