Will raise Rs 200 cr via public issue

MUMBAI: Hospitality major The Pride Group of Hotels, which  launched its new economy hotel brand Biznotel in Pune last week, is planning to invest Rs 350 crore for expansion.

The company currently runs five hotels and plans to add 10 more by 2010. It also plans to double its room inventory to 1,150 by the same period. To fund its expansion, the company will raise Rs 200 crore through an initial public offering (IPO) and the rest will be through term loans and internal accruals.

Also, it will open Biznotels, which are medium-priced and full-service business hotels, in Tier II and Tier III cities.

S P Jain, chairman, Pride Group of Hotels, said, “We intend to invest Rs 350 crore in the business. We are looking to raise Rs 200 crore through an initial public offer by the year end, and the rest will be through term loans and internal accruals.”

The Pride Hotels currently has 501 rooms and has a presence in Pune, Nagpur, Ahmedabad and Chennai. The company plans to add 50-70 rooms to its existing properties.

“We want to expand our 3-star and 5-star segments. We will build some Pride Amber Villas,” said Jain.

The Pride Group’s new 5-star hotel in Bangalore will become operational by 2008. Five more hotels are already under construction in other cities.

The group is planning to manage Biznotels in cities such as Hyderabad, Chandigarh, and Kochi.  The Amber Villas will be set up in Jaipur. It intends to add around 750 rooms through its resorts and spas that are coming up in Goa, Mumbai and Alibagh.

To meet its talent requirements owing to its expansion plans, The Pride Group has followed the lead of Taj and Oberoi hotels and opened its own hotel management institute in Pune. Each year it will churn out 120 graduates, which Jain believes could be easily absorbed within the group.

s_tanvi@dnaindia.net