Project Report of The Grand Five Star Deluxe Hotel

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Project Report of The Grand Five Star Deluxe Hotel
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VISION:
To be an organization which aims at leadership in the hospitality industry by

understanding its guests, and designing and delivering products and services which
enable it to exceed their expectations.
To have a user-friendly technology enhancing value for our customers and helping our
personnel by making information more accessible.
To an organization which is committed to the environment, using natural products and
recycling items, thus ensuring proper use of the diminishing natural resources.
MISSION:
Our Guests
We are committed to meeting and exceeding the expectations of our guests through
our unremitting dedication to every aspect of service.
Our People
To be committed to the growth, development and welfare of our people upon whom
we rely to make this happen.
Our Society
To work with the communities within which we operate in areas of improving their
lives through leadership driven corporate social responsibility charter.
Our Shareholder
To deliver consistent value addition to our stakeholder
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Chapter
Particulars
Page No.
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1
1.1
1.2
1.3
2
2.1
2.2
3
3.1
4
4.1
5
5.1
5.2
5.3
5.4
5.5
5.6
5.7
5.8
5.9
5.10
6
6.1
6.2
6.3
7
7.1
7.2
7.3
7.4
8
8.1
8.2
8.3
9
9.1
9.2
9.3
9.4
10
10.1
10.2
10.3
10.4
10.5
10.6
11
12
12.1
4
Introduction
The Grand Five Star Deluxe Hotel
Business Activities
Overview of Hotel Industry
Location & Operation
Location of the Company
Locational Advantage
Background
Background of Partners
Services of Hotel
General Guest Services
Infrastructure
Swimming Pool
Fitness Room
Business Room
Banquet Hall & Convention Centre
Conference Hall
Rooms & Suites
Restaurants & Bars
Lounge Bars
Kids Arena
Layout Plans
Industrial Scenario
National Scenario
Comparable Company Analysis
Global Scenario
Employment Opportunities
Employment in Different Department in Industry
Increasing Employment opportunities in Industry
Projected Human Resource Requirement in Hotel
Some of Career Opportunities in Hotel Industry
6-9
6
7
9
10
10
10
11
11
12
12
13
13-17
13
13
14
14
14
15
15
15
16
18-22
18
21
22
23-24
24
24
24
24
Different Department in Hotel

Functioning Department
Support Department
Key Control Department
Market Study
Past Supply & Present Demand
Occupancy Rates
Average Room Rates
Government Measures Benefiting the project
Domain Facts
Foreign Direct Investment in Hotel Industry
Reasons foe Low FDI in Hotel Industry
Major Reasons to Invest in Hotel Industry
Other Government Initiatives
Government Open Sky Policies
Tax Benefits in Hotel Industry
Pattern of Financing in Corporate Hotels
Public Involved in Hotel Industry
Trends in Public/Private Partnerships
25-28
25
26
27
29-32
29
30
31
32
33-38
33
33
35
36
36
37
39
40-43
40
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13
14
15
16
17
18
19
20
20.1
20.2
20.3
20.4
20.5
21
21.1
21.2
21.3
21.4
21.5
21.6
21.7
21.8
21.9
21.10
21.11
21.12
Joint Venture Concept in Hotel Industry

Hotel Brand Explosion in India
Hotel Development Cost
Marketing
SWOT Analysis
Growth Drivers in Hotel Industry
Quality Control
Key Players
Oberoi Group of Hotels
Leela Hotels
Tarrif Rates of Different Hotels in Gurgaon
Proximity Comparison in Gurgaon
Comparison of Services Rendered in Hotels in Gurgaon
Brief Of The Proposal
Brief of the JV Agreement
Income Generation Sheet
Expense Sheet
Cash Flow
Profitability Projection
Projected Balance Sheet
CMA-Operating Statement
CMA-Analysis of Balance Sheet (Liabilities side)
CMA-Analysis of Balance Sheet (Assets side)
Comparative Statement of CA & CL
Turnover Method
CMA- Financial Position
44
46
47
49
51
55
57
58-78
60
72
77
77
78
79-95
79
80
81
82
83
85
86
89
91
93
94
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CHAPTER 1
1.1 THE GRAND FIVE STAR DELUXE HOTEL:

The Grand Five Star Deluxe Hotel is a Joint Venture between Mr. Vijay Yadav (Land
Owner) and the developer from USA. Land selected for the project is of 8 Acres. The Hotel
offers 370 rooms.
There are many different types of ownership, from Condos, to Parking Slots, to Fractional unit
ownership.
Prices during the month of December 2011

Unit type
No. of
units
60
sq.
ft.
150
Purchase Price
in US $
2,342
Price increase
per year.
Similar pro-rata increases
Parking Slot Fractional units
590
150
28,100
Parking Slots
Studio Fractional units
60
402
24,417
Studio units
1 Bedroom unit
2 Bedrooms 2 bath
370
20
6
402
558
992
293,000
398,900
712,000
$3,000
Presidential Suites
1340
959,000
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1.2 BUSINESS ACTIVITIES:
The Grand Five Star Deluxe Hotel is an upscale, full service hotel, strategically located in
upcoming business area of Gurgaon. The hotel will provide premium accommodation and
efficient service with the fresh contemporary approach. With easy access to NH-3
Highway, the domestic & international airport and the metro line that now links with
various parts of Delhi. The hotel is equipped with 370 well-appointed rooms comprising of
one Bedroom, 2-bedroom and presidential suite.
In Room Facilities:
24-hours Room Services.

Tea/Coffee Maker.
Satellite LCD TV.
Electronic Safe.
Hair Dryer.
STD/ISD Direct Dial Facility.
High Speed Wi-Fi & Broad band Connectivity Facility.
Iron & Ironing Board.
Daily Newspaper.
Choice of Fruits.
Mini Bar.
Weighting measures.
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Features of Hotel:
Club Lounge
Swimming Pools
Fitness centre/Spa
24x7 Business Centre
Beauty Salon
Airport Transfers
Travel Assistance
24-hours Currency Exchange
Doctor on call
In-house laundry
Baby Sitting Facility
Meeting & Conference Rooms
Banquet Facilities
Shopping Facility
24-hrs Front desk facility
Speaker phones
Shoe Shine Stand
Voice Mailing Facility
Cordless Phone
Cable television
Wedding Services
Express Check in/ Checkout Facility
Flat Screen TV
Connecting Rooms
Gift/News Stand
Executives Floor
Bottled Water
Wheel Chair Access
Bathroom amenities
Wake up Service
Jogging Track
Game Rooms
Child Programs Facility
Smoke Detectors
24-hrs security facility
Baggage hold Facility
Coffee Shops
Centralized Air-Conditioned
Restaurants
Multi line Telephones
Complimentary Break Fast
Package/Parcel Services
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1.3 OVERVIEW OF HOTEL INDUSTRY:
Hospitality is all about offering warmth to someone at a strange or unfriendly place. It
refers to process of receiving and entertaining a guest with Goodwill. Indian Hospitality
has gained a level of acceptance world over. It has yet to go miles for recognition as a
world leader of hospitality. Availability of qualified human resources and untapped
geographical resources gives great prospectus to hotel Industry. The number of tourist
coming in India is growing in last years. Likewise, internal tourism is another area with
great potentials. Today Hotel Industry is one of the fastest growing Industry in India. It is
expected to grow to 10% between 2015 to 2020. The thriving economy and increased
business opportunities in India have acted as a boon for Indian hotel industry. The
'Incredible India' destination campaign and the recently launched 'Atithi Devo Bhavah'
(ADB) campaign have also helped in the growth of domestic and international tourism and
consequently the hotel industry. According to a report, Hotel Industry in India currently has
supply of 110,000 rooms and there is a shortage of 150,000 rooms fuelling hotel room rates
across India. According to estimates demand is going to exceed supply by at least 100%
over the next 2 years. Five-star hotels in metro cities allot same room, more than once a
day to different guests, receiving almost 24-hour rates from both guests against 6-8 hours
usage. With demand-supply disparity, hotel rates in India are likely to rise by 25% annually
The World Travel and Tourism Council, India, data says, India ranks 18th in business travel
and will be among the top 5 in this decade. With such growth, sources estimate, demand is
going to exceed supply by at least 100 per cent in coming years.
Number of Hotels 2010
Hotel categories
No. of Hotels
No. of Rooms
5 star deluxe/5 star
165
43,965
4 Star
770
134 20
3 Star
505
30,100
2 Star
495
22,950
1 Star
260
10,900
Heritage
70
4,200
Uncategorized
7,078
Total
8,707
1,32,885
Source- FHRA
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CHAPTER 2
2.1 LOCATION OF THE HOTEL

Administrative Office:
Sec.71, Facing Sourthern Pheripery Road, Gurgaon
2.2 LOCATIONAL ADVANTAGE

Gurgaon is considered as one of the fastest
growing cities in India. The fast growing BPO,
KPO, IT/ITES, Manufacturing and other
industries in the city have made it mandatory for
the city to come up with some state of the art
accommodations for overnight visitors. Gurgaons
proximity to the national capital Delhi and its
proximity to both international and national
airport have had a major impact on the growth of
the city when it comes to acting as a host to a
number of foreign conglomerates as well as domestic dignitaries.
The Hotel stands just a few minutes from all the major destinations:Just 20 minutes away from I.G International Airport, Delhi.
25 minutes from Delhi Railway Station.
5 minutes from Iffco & Sushant Lok Metro Station.
Many repudiated institutions like Shikshantar, MDI, The Shri Ram School, DPS
Pathways, Heritage and GD Goenka are just 15 minutes away.
The project stands at 10 kms from global companies like Steller Information System Ltd,
HCL, etc. providing a high business to the project.
The project stands just 25 kms from historical monuments like Humayun Tomb, Jantar
Mantar, India Gate, Aksharadham Temple, Qutub Minar etc. facilitating the tourists.
Advance means of transport & communication will be easily available at site.
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CHAPTER 3
3.1 BACKGROUND OF PARTNERS:
The parties of agreement are as under

1. Mr. Vijay Yadav (Shikohpur Developer).
2. USA Developer.
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CHAPTER-4
Sitting atop 8 acres of lush, fragrant garden the hotel offers 370 rooms.
4.1 General Guest Services:

24-hour Room Service.
Signature gift and sundry shop.
Guest-chosen daily newspaper delivery.
Digital interactive television entertainment

system.
Business Phone services.
Laundry and dry cleaning services.
Complimentary shoeshine service.
Limousine and rental car service.
Car detailing.
Secured & High speed elevators.
Central satellite system and intercom system.
Central Air conditioning.
CCTV and 24 hrs security system.
Gym, sauna, Jacuzzi, baby play area, party and meeting hall.
Sport and activity center.
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Internet & Media lounge. High-Speed Internet access & Wi-Fi.

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Baggage Storage
Concierge Desk
Foreign Currency Exchange.
Multi-lingual Staff.
Express mail.
Meeting Room
Outdoor tented reception area.
Wedding gazebo
Terrace Steak House
Pool bar & Grill.

Ample car parking for residents and guests
Large full building height central Atrium area.
Shopping promenade.
Sports and activity center.
5 restaurants and bars & coffee shops.
Large lobby and corridors to give feeling of comfort and openness.
Tennis Courts.
Lounge with nightly live music.
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CHAPTER 5
5.1 Three Swimming Pools:

Swimming pools will provide not only a cool
and relaxing swim after a busy working day,
but will also be place for an informal drink or
quick bite with friends or business partners or
the place for a book or a moment of
meditation.
5.2 Fitness Room:

The fitness room will meet the demands of the
most demanding athlete and is equipped with a
treadmill, bicycles and workout equipment. All
guests will have free access.
5.3 Business Centers:

The business centre will provide a full range of
office support services including fully wireless
Internet and E-mail access. The conference
facilities will be equipped with the latest
technical equipment to satisfy the most
demanding businessman.
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5.4 Banquet Hall & convention Centre
Our team will guarantee that every venue is
organized in accordance with the most
professional standards. The client may
choose from a wide variety from cocktail,
cold or warm buffet to a full menu supported
by an international wine card.
5.5 Conference Hall

Conference Hall will be able to fit around 100
people and will be equipped with amenities
such as flip charts, wireless internet, LCD
projector, White Board, Basic Stationeries, etc
5.6 Rooms & Suites

The Hotel room will be of stylish,
comfortable. Well furnished and airconditioned rooms with contemporary luxury
and gracious services.
5.7 Restaurants & Bars

The hotel will be having restaurant, a lounge and a coffee shop,
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which will be offering a choice of continental, Chinese and
variety of food from Indian cuisine, with live piano, music. The
bar will be stocked with best of spirit and wine where guests can
spend their time gossiping and watching television.
5.8 Lounge Bars

The hotel will be having a music lounge equipped with the latest & a
light system. The zeal to dance and enjoy will be the welcome
thought.
5.9 Kids Arena

The Hotel will be having Kids arena for
children to have fun and play.
5.10 Layout Plans
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5.10.1 Floor Plan Studio of 402 Sq. Ft
5.10.2 One
Room of 558 Sq
18
Bedroom & One Bath

ft.
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5.10.3
Two
Bedrooms & 2 Baths
5.10.4 Presidential Suites 3 Bedrooms 1340 Sq. ft

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CHAPTER 6
6.1
NATIONAL SCENARIO
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India is the country with only a limited number of international brands and had hotels that
were mainly concentrated in the major metros and predominantly in the luxury/first class
positioning. Over the years, the hotel industry has undergone significant changes and has
reinvented itself in a manner that we believe has benefited the industry as a whole,
including all its constituents hotel guests, investors, employees and other stakeholders.
Current Occupancy Situation of Hotel in Gurgaon and Delhi
Hotel Imperial In Delhi-99.57%

Hotel Trident Hilton Gurgaon- 98.30%
Indian Hotel- 97%
Tourism is presently the most important civil industry in the world. The hospitality
industry is second only to the global oil industry in terms of turnover, and is, by far, the
largest employer around the world. Ten percent of the world's work force is in the tourism
industry, and 10 percent of the world's GNP comes from tourism.
Foreign tourist arrivals to India increased from 5.13 million in FY09 to 5.5 million in
FY10, thereby resulting in a increase of 7% YoY. . Foreign Tourists Arrivals (FTAs)
during the period January-October 2010 were 4.32 million with a growth rate of 9.9 per
cent. The tourism ministry has set a target of 10 million tourists by 2010. The World
Tourism Organization has predicted that India will receive 25 million tourists by 2015.
According to the latest Tourism Satellite Accounting (TSA) research, released by the
World Travel and Tourism Council (WTTC), the demand for hospitality in India is
expected to grow by 8.2 % between 2010 and 2019. This will place India at the third
position in the world. India's hospitality sector is expected to be the second largest
employer in the world. Capital investment in India's hospitality sector is expected to grow
at 8.8 % between 2010 and 2019. The report forecasts India to get more capital
investment in the hospitality sector and is projected to become the fifth fastest growing
business destination from 2010 through 2020.
The World Hospitality Council, figures indicate that the Indian hospitality demand is
expected to grow at 8.8% from 2007-2016. According to the World Hospitality Council,
revenue from foreigners to India is expected to grow to US$424 billion by 2015. Indians
residing in India as well as abroad are expected to spend US$63 billion by 2015.
As per the Hospitality Competitiveness Report 2009 by the World Economic Forum,
India is ranked 11th in the Asia Pacific region and 62nd overall, moving up three places
on the list of the world's attractive destinations. It is ranked the 14th best destination for
its natural resources and 24th for its cultural resources, with many World Heritage sites,
both natural and cultural, rich fauna, and strong creative industries in the country. India
also bagged 37th rank for its air transport network. The India hotel industry ranked 5th
in the long-term (10-year) growth and is expected to be the second largest employer in
the world by 2019.
To encourage the hotel sector, the government in recent times, has taken some measures
which will benefit the sector. In FY09, Rs.5.2 bn for development of hotel infrastructure
was allocated. This figure is higher by Rs.970 m as compared what was allocated in the
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previous year. However, it is only 1% of the total government spending. RBI has
allowed ECB upto US$ 100 m in January 2009, which would help in raising funds. The
Centre and States are also working out a PPP (Public-Private-Partnership) model to
increase hotel capacity.
The hotel and tourism industry's contribution to the Indian economy by way of foreign
direct investments (FDI) inflows were pegged at US$ 2.17 billion from April 2000 to
September 2010, according to the Department of Industrial Policy and Promotion
(DIPP).
The who's who of the world of international fund companies - Blackstone, Morgan
Stanley, Walton Street Capital, Starwood Capital, Merrill Lynch, West bridge Capital,
Lehman Brother are looking to invest in the hospitality sector.
Around 500 million domestic tourists are projected to travel across India by 2010
compared to around 325 million in 2006 and growing at over 10% annually.
India's hospitality sector is expected to see an estimated investment of US$11.41 billion

in the next two years, and around 40 international hotel brands making their presence in
the country by 2011, according to a report by Ma Foi Management Consultants.
Moreover, the sector is expected to provide over 400,000 jobs.
In India, the industry supports 48 million jobs, directly or indirectly or 8.27 per cent of
total employment and accounts for 5.83 percent of the GDP, according to Department of
Tourism & Hospitality estimates.
According to an HVS International report average employee to room ratio is 1:8 in

Indian hotels across all markets and drops to 1:5 for three star categories of hotels. The
report also states that the hotel sector would need a fresh workforce of atleast 94,000 by
2014-15.
India currently has over 200,000 hotel rooms spread across hotel categories and guesthouses and is still facing a shortfall of over 100,000 rooms (source: FHRAI).
The country is witnessing an unprecedented growth in hotel constructions and will be
adding almost 114,000 hotel guest rooms to its inventory over the next five years.
(source: HVS)
In the FHRAIs memorandum presented to the government recently, it is said that

atleast 1,50,000 additional rooms are required to meet the target of 5 million foreign
tourist arrivals. This entails an investment to the tune of over Rs.15,000 crore. Currently
there are 1,05,000 hotel rooms in the three to five-star category in India. The annual
growth rate of hotel rooms in India is 6%. Nearly 11 per cent of the hotel demand in the
country is from long stay guests.
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To set up a 5-star deluxe hotel with 250-300 rooms will cost approximately Rs.300
crore, excluding the land cost. As per estimates by hospitality consultancy HVS
International, around 150 hotel projects are in the works across the country, which are
likely to add around 53,000 rooms over the next five years.
There are about 1,285 approved budget hotels across the country with about 51,000
rooms apart from guesthouses, dharamshalas and devasthans in the unapproved sector.
The footprints of the IT and ITES in Tier 2 cities like Indore, Jaipur, Agra, et al, have
played a role in driving the demand for budget hotels in these cities.
The tourism ministry has proposed a cash subsidy of Rs.2 lakh per room for one-star
category and Rs.3 lakh per room for two and three star category hotels to facilitate their
growth. According to Federation of Hotel and Restaurant Association of India (FHRAI),
the country is short of 65,000 budget category rooms.
Average Room Rate (ARR) of hotels in India is increasing at the rate of over 20%almost equal to that of hotels in developed countries such as Europe and the US. The
growth in ARRs is direct fallout of the shortage of five-star accommodation in India and
high demand generated by the booming economy. This shortage has stimulated
investments in the hotel industry.
Most of the five-star hotels are witnessing an average room occupancy rate of over
80%.
For every room constructed, 3-5 jobs are created. The World Travel and Tourism
Council have estimated that by 2010, tourism can support 25 million jobs (1 in every 15)
in India through 8% annual growth.
For every rupee that goes into building a hotel, three more are spent on furnishing it.
More than 27000 items go into a hotel including building material, chandeliers,
glassware, furnishings, energy saving devices etc., and at present 90% of hotel
accessories are indigenously produced in India. So the domestic accessories sector
stands a good chance in the near future.
The average duration of stay of a foreign tourist in India is one of the highest in the
world. On an average, it exceeds 27 days in the case of non-package tourist & is 14 days
in the case of package tourist.
Wedding tourism is growing almost 100% on a year-on-year basis. Generally, the ratio
of foreigners to Indians in an NRI wedding is 7:3. On an average, an NRI wedding
organized in India costs Rs.50 lakh. On an average, 50-150 rooms are booked in a star
category hotel.
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Cruise shipping is growing globally at the rate of 12-15% annually. In India the cruise
market is in excess of 1,25,000 guests annually and will grow at over 10% annually.
22 Institutes of Hotel Management being operated as Centres of Excellence for

providing hospitality manpower. The government plans to set up four Indian Institutes of
Hotel Management in Uttaranchal, Jharkhand, Chhattisgarh and Haryana. To provide
training in the area of tourism, the tourism ministry will also start 400 training
programmes. Estimates indicate a need for about 15,000 more trained persons in the star
category hotels, which includes about 2,700 managers, 2,500 supervisors and about
1,000 staff.
Online travel industry is growing at a CAGR of 125%. Generating revenues of around

$300-500 million, the size of this industry is around 2% of the entire travel industry,
which is estimated to be $42 billion. Growing at the current rate the online travel
industry in India is expected to become a $2 billion industry by 2008.
Table below presents the nationwide occupancy and average rate performance.
Year
Ending 31st
March
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
CAGR
Occupanc
y
57.20
51.60
57.20
64.80
69.00
71.50
71.40
68.80
60.30
65.00
68.00
%
Change
-9.80
10.90
13.30
6.50
3.60
-0.01
-3.60
-12.40
7.80
4.60
0.10%
Average
Rate
3731
3467
3269
3569
4299
5444
7071
7989
7837
6426
6800
%
Change
-7.10
-5.70
9.20
20.50
26.60
29.90
13.00
-1.90
-18.00
5.80
5.5%
RevPAR
2134
1789
1870
2313
2966
3892
5049
5496
4726
4177
4624
%
Change
-16.20
4.50
23.70
28.30
31.20
29.70
8.90
-14.00
-11.60
10.70
5.70%
6.2 COMPARABLE COMPANY ANALYSIS

Premium Hotels
Company
Enterprise
Value
Revenue
LTM
NFY
NFY+1
LTM
NFY
NFY+1
LTM
NFY
NFY+1
Indian Hotels
Co
USD
2,599
USD 552
16.2%
4.71x
3.72x
29.0x
16.5x
12.1x
NM
NM
23.3x
EIH
1515
190
17.9%
7.98x
5.28x
NM
19.4x
15.1x
NM
38.3x
26.0x
110
97
29.5%
NM
8.17x
38.7x
21.8x
15.3x
NM
31.6x
20.3x
51
38.3%
4.93x
NA
12.9x
NA
NA
27.7x
NA
NA
Hotel
Leelaventure
Taj Hotels &
Resorts
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Asian Hotels
North Orchid
Royal
Hotels
Advani Hotels
& Res (India)
102
115
44.7%
0.88x
NA
2.0x
NA
NA
2.8x
NA
NA
95
61
27
11
24.2%
0.6%
3.6x
5.40x
2.95x
NA
14.7x
NM
10.2x
NA
7.0x
NA
32.5x
NM
17.4x
NA
10.6x
NA
6.3 GLOBAL SCENARIO
Hospitality Industry being the largest service sector in the country, adds around 8.60
percent to the national GDP and 3.1 percent of total GDP.
Foreign Tourist has increased by 7 percent as compared to previous years which will be
giving an advantage to the project.
Foreign Exchange earnings have witnessed to US$ 1.25 billion providing an economic
benefit to the country
Globally, hospitality industry is one of the largest service industries in terms of revenue
generation and foreign exchange earnings, contributing over 9% to global GDP. It is also
one of the largest employment generators in the world. An estimated 235 million people
work directly or in related sectors, accounting for more than 8% of global employment.
International hotels are deriving a big chunk of revenues from casinos and betting arenas.
Margins in this segment are also higher. But for Indian hotel majors, setting up casinos
and betting arenas is not allowed according to Indian laws. However, when domestic
hotels are compared to international hotels then they are fairly competitive in terms of
average room revenues.
For arriving at a Net Asset Value

Setting up a 5 star hotel
= Rs 30-35 m*
Add
= Cash + investments
Deduct
= Debt
Net Asset Value (NAV)
Total
Divide
No. of Shares
NAV per share
= Rs x
Compare with current market price
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CHAPTER 7
Clocking revenues worth billions of dollars, hotel industry is dynamic and fast growing. The
opportunities for career advancement in this sector, post-recession, are immense. The global
demand for travel and tourism provides unprecedented opportunities going forward in this
industry. As India is one of the new markets in the hospitality demand for trained manager will
be on rise. An average staff turnover in a five star hotel is 24.14 percent. There is a requirement
of about 15000 additional trained persons in the star category hotels in India, which includes
about 2700 managers, about 2500 supervisors and about 1000 staff members. The requirement
given for manager and supervisor categories which totals to 5200 and will be filled by 3 or 4
years diploma and degree holders. A single five star hotel could employ more than 400
employees. A total of 57508 people are employed to service about 36000 rooms in this
category. On an average, there are approximately 176 employees per 100 rooms in these
hotels. The employment pattern is the across geographic regions.
The major employing functions are F&B Service, F&B Kitchen and Housekeeping. They,
together, account for 56% of the total employment in these hotels.
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7.1 Employment in Different Department in industry
Five/Four Star
Hotel
One/Two &
Three Star
Other Hotels
Managemen
t team
50
Front
office
45
F&B
service
128
F&B
kitchen
105
House
keeping
82
Accounts
Total
40
450
33
30
85
70
55
27
300
16
15
41
34
26
13
145
7.2 Increasing Employment Opportunities in Industry

Employment Pattern and Forecast:-
5/4 Star Hotels

1-3 Star Hotels
Smaller Hotels
Total
Employees
Intensity
(Employees per
100 rooms)
Employment
2002
Employment
2011
Employment 2016
174
122
58
NA
57000
52500
638000
747500
83000
63000
1405000
1551000
110400
83000
3261500
3454900
7.3 Projected Human Resource requirement in Hotels:Particulars

Five Star Hotels
2010
76
2012
91
( fig in 000)
2018
104
2022
117
7.4 Some of the career opportunities in hotel industry are as follows.
The industry offers more career options than most: - No matter what kind of work and
wherever aptitude lies there is a segment of the industry that can use talents.
The work is varied: - Because hotels and restaurants are complete production,
distribution and service units, and managers are involved in a broad array of activities.
There are many opportunities to be creative:- Hotels and restaurants managers might
design new products to meet there needs of their guests, produce training programme for
employees, or implementing challenging advertising, sales promotion and marketing
plans.
Hospitality jobs are not nine- five jobs: - Hours are highly flexible in many positions.
CHAPTER 8
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The departments are classified on account of its function. They are as follows:-
8.1 Core Functioning Department

Food & beverage (F&D) Department:F & B deals mainly with food and beverages service allied activities. Different
divisions are there in F & B like Restaurants, Specialty Restaurants, Coffee Shop (24
Hrs), Bar, Banquet, Room Services etc. Apart from that they have Utility services
(Cleaning).
Front Office Department:The front office is the command post for processing reservation, registering guests,
settling guest account (cashiering), and checking out guests. Front desk agents also
handle the distribution of guestroom keys and mail, messages or other information for
guests. The most visible part of the front office area is of course the front desk. The
front desk can be a counter or, in some luxury hotels, an actual desk where a guest can
sit down and register.
Housekeeping Department:The housekeeping department is another department in hospitality world.
Housekeeping is responsible for cleaning the hotels guestrooms and public areas. This
department has the largest staff, consisting of an assistant housekeeper, room
inspectors, room attendants, a house person crew, linen room attendants and personnel
in charge of employee uniforms. They may also have there laundry and valet services.
Hotels with laundry and valet equipments may use it only for hotel linen and uniform
and send guest clothing to an outside service where it can be handled with specialized
equipments.
Food Production Department:Food Production deals with the preparation of food items. It basically engaged in
preparing those dish, which are ordered by the guest and afterwards is catered by the
F&B department. Cuisine like Indian, Continental, Thai, Italian, Konkani (Costal Sea
Food), South Indian, Chinese, Mexican, etc. Different chefs are appointed for the
specialty cuisine.
8.2 Support Department (Cost Centre)

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Marketing & Selling Department:Sales and marketing has become one of the most vital functions of the hotel business
and an integral part of modern hotel management. It includes packaging for selling,
sales promotion, advertising and public relations. The marketing division is charged
with the responsibility of keeping the rooms in the hotel occupied at the right price
and with the right mix of guests.
Engineering & Maintenance Department:The energy crisis throughout the world has given a great importance to the
engineering department of a hotel. This department provides on the day-to-day basis
the utility services, electricity, hot water, steams, air-conditioning and other services
and is responsible for repairs and maintenance of the equipment, furniture and fixture
in the hotel. The engineering department has an important role in satisfying the guestdemand and helping to maintain the profit level of hotel. The cleaning, up-keep,
repair, replacement, installation and maintenance of property and its furnishing,
machinery and equipment are the joint responsibilities of Engineering/ Maintenance
and the Housekeeping Department.
Finance, Accounting & Control Department:A hotels accounting department is responsible for keeping track of the many business
transaction that occur in hotel. The accounting department does more than simply
keep the books-financial management is perhaps a more appropriate description of
what the accounting department does. Whereas the control department is concern
with the cost control guidelines by way of reducing in investment, reduction in
operating cost, control of food service costs, control of beverage cost, labour cost
control etc.
Safety & Security Department:The security guest, employees, personal property and the hotel itself is an overriding
concern for todays hoteliers. In the past, most security precaution concentrated on
the prevention of the theft from guests and the hotel. However, today such violent
crimes as murder and rape have become a problem for some hotels. Unfortunately,
crime rates in most majors cities are rising. Hence today security department also
concentrate on these additional criminal activities too.
Administrative Department:Top organizational members usually supervise the Administration Department in a

hotel. This department is responsible for all the work connected with administration,
personnel, manpower, employees welfare, medical health and security.
Human Resource Department:-
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This department has newly taken step in hotel industry and within a short span of
time it has become very important part of the organizations. It plays the role of
facilitator between the bargain able cadre and non-bargain able cadre.
8.3 Key Control Department
Types Of Keys: Room Keys: Different keys are issued to guest for their rooms.
Have a heavy key (key tab) discussion guest taking it away.
Bells bay will take the key from the guest at the time of check out.
Section Keys
These keys will be issued to room alter dents.
Will open doors of one section /floor.
The will not open the double lock rooms.
Room attendants will carry their key bundles, tied around so that they dont loose.
Floor Master Key: Will open all rooms on the floor.

Will not open double locked room.
General Master Key: Will be used by Deputy House Keeper.
Issued to night duty housekeepers also.
Will be enabling to open only floor as the hotel expect the double locked room.
Grand master key: Will open rooms of all room, even the double locked rooms.
Will be issued to Executive General Manager and Duty Manager (extreme case
must be taken in opening a double locked room i.e. only in case of emergency)
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CHAPTER 9
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9.1 Past Supply and Present Demand
A comparison between increase in supply and demand in 2010-11 as compared to 200910 for the major markets in India and two levels of positioning namely mid-market and
luxury/first class. Figures has been calculated by using performance of each hotel in these
market for 2009-10 & 2010-11 and then comparing the total of accommodated rooms for
all hotels to the increase in supply in the market during the same period.
Demand Supply Comparison (2009/10 2010/11)
Mid-Market
2010-11
Luxury/ First class

2009-10
Supply
Demand
Supply
Bengaluru
Chennai
6.1%
9.9%
16.5%
14.4%
21.3%
3.6%
Goa
Hyderabad
Jaipur
Mumbai
4.3%
16.6%
14.6%
18.3%
7.6%
%
30.1%
11.8%
16.7%
Ahmedaba
d*
Kolkata*
Pune*
23.7%
10.5%
30.8%
18.0%
14.5%
23.3%
2010-11
Demand
2009-10
Supply
Demand
Supply
Demand
26.8%
4.1%
16.5%
2.0%
33.9%
15.0%
42.5%
13.8%
29.9%
1.5%
0.0%
9.0%
14.0%
25.4%
5.2%
4.0%
33.1%
22.1%
11.9%
27.6%
1.2%
16.1%
14.3%
29.0%
6.0%
14.8%
1.2%
10.5%
0.0%
4.2%
30.6%
3.7%
39.2%
16.0%
2.0%
31.0%
23.7%
10.5%
30.8%
18.0%
14.5%
23.3%
30.6%
3.7%
39.2%
6.7%
0.7%
2.0%
2.9
%
16.0%
2.0%
31.0%
The study also forecast the estimated demand for hotel rooms per annum assuming that past
track in tourist traffic continues in future.
Category
Classified
Others
Total
32
All India Estimated Demand for Hotel Rooms 2011 & 2016
2011
342,053
240,680
582,733
2016
868,913
515,095
1,384,008
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9.2 Occupancy Rates

The hotel sector benefits from both holiday and business travel. Holiday travel in India is
generally seasonal in nature. Historically, over 60% of total tourist arrivals into the
country is during the period between September-May. On the other hand, business travel
is a factor of various factors.
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9.3 Average Room Rates
There are three classes of rooms in a hotel i.e. business, leisure and luxury. It is important
to understand that room rates are less elastic to a fall in price at the higher end of the
segment (luxury) than at the lower end of the spectrum (business/leisure).Currently, the
big hotels have average occupancies of 60%.
Nationwide performance
Year
Occupancy
Rate
% change
Average Room
Rate
% change
2005-06
71.5
2006-07
Revenue Per
Room
3.6
Rs 5,444
26.6
Rs 3,892
31.2
71.4
-0.1
Rs 7,071
29.9
Rs 5,049
29.7
2007-08
68.8
-3.6
Rs 7,989
13.0
Rs 5,496
8.9
2008-09
60.3
-12.4
Rs 7,837
-1.9
Rs 4,726
-14.0
2009-10
65.0
7.8
Rs 6,426
-18.0
Rs 4,177
-11.6
2010-11
68.0
4.6
Rs 6,800
5.8
Rs 4,624
10.7
change
Source: HVS
9.4 Government Measures Benefiting the Project

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Various policy measures undertaken by the Ministry of Tourism and tax incentives have
also aided growth of the hospitality industry; some of them include:
Allowance of 100% FDI in the hotel industry (including construction of hotels,
resorts, and recreational facilities) through the automatic route
Introduction of Medical Visa for tourists coming into the country for medical
treatment
Issuance of visa-on-arrival for tourists from select countries, which include Japan,
New Zealand, and Finland
Promotion of rural tourism by the Ministry of Tourism in collaboration with the
United Nations Development Programme
Elimination of customs duty for import of raw materials, equipment, liquor etc
Capital subsidy programme for budget hotels
Exemption of Fringe Benefit Tax on crches, employee sports, and guest house
facilities
Five-year income tax holidays for 2-4 star hotels established in specified districts
having UNESCO-declared 'World Heritage Sites'.
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CHAPTER 10
10.1 FOREIGN DIRECT INVESTMENT IN HOTEL INDUSTRY

100 per cent FDI is permissible in the sector on the automatic route. The term hotels
include restaurants, beach resorts, and other tourist complexes providing
accommodation and/or catering and food facilities to tourists. Tourism related industry
include travel agencies, tour operating agencies and tourist transport operating agencies,
units providing facilities for cultural, adventure and wild life experience to tourists,
surface, air and water transport facilities to tourists, leisure, entertainment, amusement,
sports, and health units for tourists and Convention/Seminar units and organizations.
10.2 REASONS FOR LOW FDI IN FHOTEL INDUSTRY

The following are the some of the reasons for low foreign direct investment in this
sector. They are:
10.2.1 Multitude of taxes
Ours is the highest tax structure on tourism projects in the Asia Pacific region.
Multitude of central and state taxes is the fundamental problem plaguing the
tourism sector. Expenditure Tax of 10% is charged in hotels wherein room
charges for any unit of residential accommodation are Rs.3000 or more per day
while, simultaneously, States levy Luxury Tax ranging from 5% to 25% on the
hotel tariff. Taking into account heavy administrative costs of collection of HET
by Central Govt. and Luxury Tax by State Govt.s, the net benefit to the economy
is considerably smaller and is not compatible with the loss in revenue accruing
due to diversion of tourists to lesser-taxed estinations. The problem has got
magnified due to increase in the threshold limit, which used to be Rs.2000 per day
per individual to Rs.3000 per day during Union Budget 2002-03. With the
removal of the words per individual, the benefits of raising the threshold limit
were nullified and therefore benefits could not be passed on to tourists. The
revenue stream that the Union Government shall have to forego on abolishing
Expenditure Tax would not be substantial, and would be more than matched by
the benefits that could accrue from the increased flow of tourists who are
currently diverted to other less taxed destinations. There is no national wide tax
policy there by some international hotel chains are hesitating to establish their
subsidiaries in the India.
10.2.2 High Taxes
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One of the fundamental problems plaguing the Indian tourism sector is a
multitude of Central and State level taxes, which lead to an increased cost to the
tourists. A comparison of the Corporate Tax level in India, which affects the
hospitality sector, in comparison with our neighbors, shows Indias poor
competitive positioning.
On the indirect taxes front also, India fairs poorly as compared to competing
destinations. The following table and figure showcases tourism related major
indirect taxes benchmarked across comparable locations.
Cities/Taxes
Kuala Lumpur
Bangkok
Hong Kong
Singapore
New Delhi
Mumbai
Lowest rates
Highest rates
Airport
Related
1.70%
1.26%
0.72%
0.94%
0.94%
0.90%
0.53%
7.66%
Accomadation
Related
4.76%
6.54%
2.91%
3.85%
16.67%
13.79%
0.25%
20.00%
Food &
Beverages
Related
4.76%
6.54%
0.00%
3.85%
6.54%
19.03%
0.00%
20.00%
Car Rentals
Related
4.76%
6.54%
0.00%
4.38%
4.76%
4.76%
0.00%
33.22%
Total
Taxes
6.46%
7.86%
2.18%
4.98%
13.18%
13.90%
0.97%
24.25%
Rank
7
8
2
3
19
21
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10.2.3 Delay in FDI Approvals & Govt. Policies

Huge delay in Foreign Direct Investment approvals in Hotel & Tourism sector. Due to
delay in approvals and lack of guidelines in the tourism policy, the Alfred Fords
proposed Himalayan Sky Village is pending since last three years. If it is approved it
is one of the highest FDI in the country in tourism sector with US$ 300 million which
also provides employment to around 3000 people.
10.2.4 Highest import duty on imported liquor used in hotels:
Under the WTO Negotiations for Market Access under the Agreement of Agriculture
(AOA), India had bound its tariffs at 100% for primary products, 150% for processed
products (this is the relevant category for liquor) and 300% for edible oils, except for
certain items (comprising about 119 tariff lines), which were historically bound at a
lower level in the earlier negotiations. With the additional duties and sales tax levied by
the State Governments the cost of alcoholic spirits sold in hotels to bonafide guests is
exorbitant. The international precedence for liquor related levies also do not substantiate
the current level of taxes. Rationalization of the tax on liquor is therefore important to
make Indian hotels competitive internationally and enable them to extend facilities,
considered important by tourists, on par with the hotels in competing destinations.
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10.3 MAJOR REASONS TO INVEST IN HOTEL INDUSTRY
38
Economic liberalization has given a new impetus to the hospitality industry.

The Indian hospitality industry is growing at a rate of 15 percent annually. The current
gap between supply and demand expected to widen further as the economy opens and
grows.
The government forecasts an additional requirement of 200,000 rooms by the turn of
the century.
The travel and hospitality industry continues to be the sector, which has largely
profited from the fast growing economy of India. This has largely been due to the 3.9
m tourist arrivals in FY06 (15% growth) over the previous period. The compounded
growth in tourist inflow over the last ten years (FY00-FY10) has been 8.2%, while in
the last five years, growth stands at 9.1% per annum.
This increase in the number of tourist arrivals in the country lifted the countrys
standing in the world of tourist destinations. The country is ranked fourth among the
worlds must see countries. The sector continues to face certain problems.
The country continues to be marred by poor infrastructure facilities like poor road
management, rail, air and sea connectivity. However, the present government in its
endeavor has taken a few initiatives like opening of the partial sky policy. This allows
private domestic airline operators to fly on the Indian skies. Some states continue to be
in political uncertainties.
As per the 2009 findings, the total number of approved rooms by the Government of
India stands at around 99,000 (estimated). These rooms are further classified into
various segments out of which, Five star and Five star deluxe hotels account for
around 27% of the total capacity, three star hotels (22%), four star (8%), two star
(9%), one star and Heritage hotels (2% each) and the rest is divided between
unclassified and unapproved hotels.
A rapidly growing middle class, the advent of corporate incentive travel and the
multinational companies into India has boosted prospects for tourism. India's easy visa
rules, public freedoms and its many attractions as an ancient civilization makes
tourism development easier than in many other countries.
The five star hotel segments have grown the fastest during the last five years at a
CAGR of 12%. Further, this segment can be divided into 3 sub-segments Luxury,
Business and Leisure. The growth in this segment indicates the genre of travelers
coming into the country. Over the last few years the country has witnessed a large
influx of business travelers in the country owing to relaxation of the governments
stand on Foreign Direct Investments (FDI) for most of the sectors in the country.
Many foreign companies have already tied up with prominent Indian companies for
setting up new hotels, motels and holiday resorts. The entry of McDonalds, Pepsicos
Kentucky Fried Chicken, Dominos and Pizza Hut has given an international glitz to
the hospitality sector.
It costs an average of US$50-80 million to set up five-star hotels with 300 rentable
rooms in India. The gestation period is usually between three and four years.
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10.4 OTHER GOVERNMENT INITIATIVES
Government has undertaken following initiatives to attract both inbound and outbound
tourists:
Incredible India -Under this program the Government promotes India through
various integrated marketing programs.
Atithie devo bhava (guests are equal to god) -Under this program the Government
create awareness among Indian people who come in contact with the tourist.
Various Infrastructure building initiatives
Encourage religious tourism for instances promote various places in India as Buddhist
abodes. Other projects are the Rs. 5,400 million National Highways Development
Project, the 5,846 km Golden Quadrilateral and the 7,300 km north-south and eastwest corridors. Sagarmala project which intends to create a network of seaports, which
will change the way people discover and experience real India.
Eco-tourism - The government is considering various fiscal and policy measures to
promote ecological and adventure tourism in the country including formulating
uniform ecological guidelines to conserve nature and waiver of service tax charged on
adventure tours.
924 Infrastructure projects worth Rs.1440.86 crore sanctioned
during the 10th Plan. The government has already okayed plans to substantially
upgrade 28 regional airports in smaller towns. The upgradation of national highways
connecting various parts of India has opened up the way for the development of
budget hotels in India.
10.5
GOVERNMENT OPEN SKY POLICIES

The Governments Open Skies policy, permission for domestic airlines to commence
international flights, start-up of various low-cost carriers, and fleet expansion by
domestic players has created a huge incentive for domestic travelers to explore far-off
destinations within and outside India. The booming aviation business is bringing an
ever increasing number of passengers to India, and pulling Indians out of their homes
and into hotels.
Moreover, the governments decision to substantially upgrade 28 regional airports in
smaller towns and privatisation and expansion of Delhi and Mumbai airport will
improve the business prospects of hotel industry in India. Government has taken
several steps to boost travel and tourism which have benfited to hospitality industry in
the country. These includes the abolishment of inland air travel tax by 15%.
Hotel Industry- Worlds Largest Industry
Share of world:
% of Total(2010)
GDP
11.0
Employment
8.0
Exports
7.9
Capital Investment
9.4
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10.5.1 KEY THINGS BEFORE INVESTING INTO A HOTEL PROPOSAL
1.
What is the strategy and the capex plans of the company over the next 5-10
years? As mentioned earlier, hotels are capital intensive in nature having long
gestation periods, which not only has a bearing on the free cash flows of hotels but
also affects the return on capital employed (ROCE) for a period of time. So the
bigger the capex plan, the more caution one should exercise. This criteria is
favorable for established hotel chains.
2.
Economic cycles also determine earnings prospects (during a downturn,
properties are cheaper and hotel chain generally tend to increase capacity).
Moreover, in tough times like September 11, hotel stocks take a beating. It is at
this time that the established players should be looked at, for when the concerns
fade away; these will be the first ones to benefit from an economic upturn.
3. A hotel chain should not be leveraged on any specific segment i.e. luxury or
leisure. Though elasticity is lower at the premium end, when tourist flow is
affected, this player could be the worst hit. Diversification reduces volatility in
earnings, to an extent.
10.6
TAX BENEFITS TO HOTEL INDUSTRY

10.6.1 Direct Taxes
Section 80IA: Infrastructure status for the hotel industry
All new hotel projects will be able to avail the benefit of deductions of 100 per
cent with respect to profits and gains for a period of 10 years. This will lead to
many new hotel projects being set up, with companies re-investing their profits in
the hotel sector. Further, it will help in channelling huge investment about Rs
50,000 crore (Rs 500 billion) in the tourism sector in next 3-4 years and quickly
bridge the shortfall of hotel accommodation.
Section 80HHD: Deduction in respect of earnings in convertible foreign exchange
Section 80 HHD gives tax exemption from the export profits to exporters. If this
is granted to the hotel industry, it would help companies to reinvest profits for
building additional capacity.
Section 32
Hotel buildings are considered as plants for the hotel industry as they are utilised
for 24 hours. The industry is required to make heavy investments in renovation,
upgradation and upkeep of the hotel buildings at all times to keep it in pristine
condition. Section 32 of the IT Act should be amended to restore the depreciation
rate to 20 per cent.
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10.6.2 Service Taxes
Hotels and other tourism related service providers who earn foreign exchange have
been included as the 13th sector in the Service Export Promotion Council set up by
the ministry of commerce, government of India.
As such, they may be granted exemption to the extent of foreign exchange earned
for the following services provided by the hotels, ie banquet rentals, rent-a-cab,
dry cleaning services, health club or fitness centre services, beauty parlour
services, internet cafe services, club/association service, business support services,
business auxiliary services, management consultant services, renting of immovable
property, etc.
10.6.3 Custom Duty
The customs duty structure should be rationalised for hotels and restaurants in tune
with the international practices, to enable the Indian service sector to compete with
their international counterparts.
This is specially so for import duty payable by small sized hotels and restaurants
who do not earn substantial foreign exchange and therefore, are not eligible for
any of the Export Promotion Capital Goods schemes.
10.6.4 Exise Duty
Seeks excise duty exemption on supply of food preparations (as part of their food
and beverage services) by hotels or restaurants to their by guest (staying in the
relevant hotel).
Also, hotels and restaurants with turnover less than Rs 1.50 crore (Rs 15 million)
should be exemption from paying central excise duty on the products produced
and consumed within the premises.
10.6.5 Interest subvention to employment intensive sectors
The 2 per cent interest subvention extended to employment-intensive sectors like
textiles, leather, marine and handicrafts as announced in the relief package
announced by the government of India on December 8, 2008, should be definitely
extended to the hotel sector as their employment generation capacity is much
more than these sectors.
10.6.6 Luxury Tax
Luxury tax varies widely across services and states. Also, in the most of sales it is
charged on the published tariff by not considering the commissions paid to agents
and discount offered to walk-in clients. So the industry seeks exemption of luxury
tax on the room tariff less than Rs 2,500 and to charge a uniform rate of 4 per cent
on the actual tariff where room rent is Rs 2,500 or more per day.
10.6.7 VAT/ Sales Tax & Other Taxes
Vat/Sales tax on food & beverage are different for each state and it should be
uniform over the country. It will help in many hotel projects coming up all over
the country which leads to lowering hotel tariffs and generating employment.
CHAPTER 11
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Although there are signs of a favorable comeback for the industry, lenders have not returned
to the go-go days of 80% loan-to-value and easy construction financing. What we see today is
debt financing for acquisition and refinance projects. While there are a few exceptions,
construction financing is not projected to return in earnest for another three to four years.
Loan-to-value ratios are between 50% and 75%, with the sweet spot between 60% and 65%.
Lenders want equity to remain in properties and debt service coverage around 1.40x.
Interest rates have fallen between 7% and 8%, although lower rates are available on lowerleverage projects. Borrowers need to be financially strong, with all sponsors willing to
personally guarantee the loan. While money is available for hotel projects, there is a smaller
pool of lenders. Banks have failed, lenders have distressed assets on their books, and even
those with performing loans dont have room to do additional hospitality deals.
1. Low leverage We expect loan-to-value ratios to remain low as lenders continue to be
selective with their underwriting. This will lead to a significant decline in supply growth in
the short-term. On refinance projects, many owners will be required to contribute additional
equity in order to meet loan-to-value requirements. If additional cash isnt available to do this,
borrowers will need to take on additional equity partners or work to convince their lenders to
extend the terms on existing loans.
2. No cash out Equity partners will need to be patient about getting money out of their
hospitality investments. No longer can hotels be viewed as piggy banks. Owners need to get
used to making money on the performance of the property rather than through its sale or
refinance.
3. Strong borrower financials Borrowers will continue to need to have strong personal
financials with ample liquidity and high net worth. Personal guarantees by all sponsors will
remain a requirement. According to an April 2010 HVS Career Network survey, financial
stability, good credit history, capital, access to equity and high net worth are critical borrower
characteristics and ones we believe lenders will require in the future as well.
4. Higher interest rates With still much economic volatility and declining hotel values,
lenders will continue to require a premium on hotel investments. Interest rates will remain in
the 7%- to 8-plus % range, with lower rates available on low leverage (50% loan-to-value)
deals. Projects with high cash equity; owners with hotel experience and a proven track record;
a strong management team; risk strategies and policies; and a respected brand will have the
best chance at securing competitive rates.
5. Fewer lenders There will continue to be a more limited number of banks and private
lenders making hotel loans. Lenders are watching their existing hotel loans decline in value,
others have loans on their books that will need to be refinanced during the next three to five
years, and still others are preserving their capital for different uses. These factors will
continue to limit the availability of debt financing in the hospitality sector.
CHAPTER 12
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Public sector involvement in hotel projects is becoming increasingly common as the high cost
of development and limitations on the availability of capital for new hotel investment limits
the feasibility of conventional financing. The presence of a hotel property in a community
may stimulate local economic activity by attracting new visitors and events as well as
accommodating business travel in the region. As most communities desire the economic
impact of group events and the spending of the visitors they attract, many are providing public
subsidies to projects that are not feasible on a purely private basis.
Public involvement in hotel development may be divided into two general categories:
1) Public/private partnerships, and
2) Public financings.
In a public/private partnership, the hotel is typically owned and developed by the private
partner, and public involvement takes the form of a public subsidy or bridging the gap
between the cost of constructing and financing a hotel project and the combination of equity
and loans a private developer is able to secure for the project. In the category of public
financing, the sponsoring municipality issues tax-exempt debt to cover the cost of
constructing and financing the hotel project, accessing the municipal bond market rather than
conventional sources of hotel debt and equity. The net operating revenues of the hotel are
pledged as the first source of funds for the repayment of the bonds.
12.1TRENDS IN PUBLIC/PRIVATE PARTNERSHIPS
The amount of public support required to finance a hotel through a public/private
partnership is dependent upon the gap between the capital cost of the project and the
amount of debt and equity that can be raised in the capital markets. The financial
feasibility of a hotel depends on several factors, including: Estimated net operating
income
Construction cost
Interest rate levels
Availability of equity
Seasonality and volatility of the local hotel market
Other factors that affect the allocation of investment risk and return
Comparison of Hotel Financing Approaches

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Issue
Ownership
Public/Private Partnerships
A privately owned single
purpose
entity,typically
a
limited liability corporation
("LLC") holds title to the hotel.
This owner is responsible for
engaging the developer and
operator.
Operation
A hotel management company

is engaged to operate the hotel.
It may be managed by a major
hotel brand company (e.g.
Marriott, Hilton, Hyatt or
Starwood) or by a third party
operator with a
franchise
agreement to brand the property.
Compensation is typically based
on a percentage of gross
revenue, net operating
income or both.
Financing
Privately owned hotels are

financed with a mix of debt and
equity. In the current markets,
lenders will only provide debt
for 50% to 60% of the project
cost, and equity investors must
provide the balance of funding.
Typically the developer obtains
a variable rate construction loan
which is later taken out with a
permanent Financing at the time
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Public Financing
A publicly controlled entity, that may
be an agency of the sponsoring
municipality or a not-for-profit
corporation, holds title to the hotel.
Through the ownership entity, the
sponsoring municipality is responsible
for engaging the hotel developer and
operator. Various forms of non-profit
ownership are possible under IRS
rules, including a "63-20 corporation"
under Section 115 of the IRS code or a
501(c)(3) under IRS Ruling 57-128.
A hotel management company is
engaged to operate the hotel under a
Qualified Management Agreement
("QMA") that conforms to Internal
Revenue Service regulations. The
maximum length of a QMA is 15 years,
which is shorter than the term of
operating agreements for privately
owned hotels. Compensation to the
operator must be on a fixed fee basis
rather than as a percentage of revenue
or net operating income. Most publicly
financed hotel deals have been
managed by a major hotel brand
company. Franchise agreements are
less common because hotel brands are
reluctant to agree to fixed franchise
fees as is required in a QMA.
Publicly owned hotels are all debt
financed through the issuance of
municipal bonds. Some of the bonds
may be "non-recourse." That is,
the revenues of the project are the only
source of payment and credit for the
bondholders. To be rated as investment
grade, debt service coverage on nonrecourse debt must exceed 2.0 times
debt service. Typically, net operating
income is not sufficient to secure
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Cost of funds
hotel operations stabilize.

Equity investment is obtained
by selling stock in the LLC, and
the development group may
have a controlling interest in the
LLC.
In
public/private
partnerships a governmental
entity may also provide an
equity contribution to the
project with little or no
expectation of getting a cash
return on that equity investment
Interest
rate
levels
on
permanent debt may range from
8% to 10% in the current
financial markets. Private equity
investors may require from 10%
to 15% cash return on equity.
Forms of Public Public subsidies may take the

subsidiaries
form of land contributions,
infrastructure
and
parking
development, tax abatements,
tax turn backs, and cash
subsidies.
Claim on
income & the
asstes
45
The investors in the LLC

typically claim the residual
project income from operations
enough nonrecourse debt to pay for the

project. Consequently, the sponsoring
municipality may provide credit
enhancement. This usually involves
some form of pledge to pay debt
service in the event that hotel revenues
are insufficient. The development team
may be required to hold some
subordinated debt, but this debt is
typically less than 10% of the total
financing.
In today's financial markets, nonrecourse debt carries interest rate levels
of 7% to 7.5%. Interest rate levels on
the credit enhanced debt
depends on the credit of the sponsoring
municipality.
A
AAA-rated
municipality may achieve an interest
rate level of 4.5 to 5.5%.
Subordinated debt carries negotiated
interest rate levels in the range of 9%
to 12%. Consequently, the cost of
funds for a publicly developed hotel
are substantially less then from
privately financed hotels.
As in public/private partnership deals,
public subsidies may take the form of
land contributions, infrastructure and
parking development, tax abatements,
tax turn-backs, and cash subsidies. In
addition, credit enhancing debt is a
form of local public subsidy. Typically
one objective of of a public financing
is to reduce the level of public equity
contribution as compared to a
public/private partnership.
The sponsoring municipality owns the

residual project income from
operations and the sale of the asset.
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and the sale of the asset.
Municipalities mass negotiate a
share of project income in
exchange for providing public
subsidies. Developers often
negotiate a "preferred return."
Public/private partnerships in hotel development are more frequently used in smaller
projects in which a reasonable amount of public equity investment can make the
difference between a feasible and infeasible project. For many smaller projects the
potential benefit of new economic and fiscal impacts are modest and only justify a limited
investment on the part of the sponsoring municipality.
Public Private Partnerships in India In Hospitality Industry
Emaar MGF has collaborated with Government of Uttranchal to Develop an
International Standard Branded 5 Star Hotel and State of Art Convention Centre in
Dehradun.
Emaar MGF has tied up with Intercontinental Hotels Group for the management of the
hotel and convention centre. The international standard up-market hotel comprising
200 guest rooms will be managed under the 'Holiday Inn' brand. The state-of-the art
convention facility, with collapsible seating and hi tech projection facilities, will be
spread over 35,000 sq ft. and will be designed to accommodate over 1,200 people.
CHAPTER 13
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Joint ventures are popping up everywhere in the hotel industry. The biggest players in the
hotel industry are using the joint venture structure to seize opportunities for acquisitions and
expansion. In recent months, Starwood Capital and Hersha Hospitality Management
announced their joint venture to expand Hersha's hotel management platform, and Thayer
Lodging Group and Jin Jiang Hotels formed a joint venture to acquire Interstate Hotels &
Resorts.
Joint Ventures Offer an Alternative to Traditional Financing - and Have Different Risks
and Rewards. Using a joint venture model for hotel acquisitions offers the benefits of
increased access to capital, sharing of risks and rewards with a partner, access to greater
resources, such as specialized staff, technology and expanded relationships. Particularly in the
current economic environment where traditional lenders are reluctant to invest new capital in
the hotel business, a joint venture with partners already active and committed to the hotel
business offers an alternative means of financing potential future business expansion. Hotel
investors hoping to seize buying opportunities for prime assets may find that the only way
they can finance the cost of acquisition is by bringing in joint venture partners. However, a
joint venture also creates its own risks, and these risks are best be addressed by the parties at
the time the joint venture is formed, rather than waiting until problems develop later.
The Essence of a Joint Venture. A joint venture is, essentially, a partnership between two or
more partners who intend to be active in the business. In many joint ventures, the parties
intend that the partners will be co-equal in making key decisions for the joint venture,
including such key decisions as when to contribute more capital to the joint venture, and when
to buy or sell an asset. A joint venture is often created through the formation of a new entity,
most often either a general partnership, limited partnership or limited liability company. The
rights and obligations of the parties to the joint venture are governed by the partnership or
limited liability company ("LLC") agreement entered into by the parties as investors in the
partnership or LLC.
Four Keys to Success in Hotel Joint Ventures Here are four of the most important ways that
the internal risks of a joint venture can be assessed and minimized:
1. Know Your Partners - Do a thorough assessment of the relative financial strength
of the partners, their past history with other business partners, their management
style and philosophy, and the personal chemistry between the management of both
partners.
2. Pick the Bus Driver - Pick the party or the person who is going to run the venture,
and vest that entity or individual with the power and ability to get things done. As
Peter Connolly advises, "Someone has to drive the bus, and that role has to be
made clear at the outset or, when the negotiating process gets to the difficult points,
nothing will get done." That obviously requires that the venture partners have a
great deal of trust in the person or entity who holds the primary power in the
venture, but without that, the joint venture will not be able to act decisively when it
is necessary to make decisions and take actions.
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3. Decide All the Important Issues in Advance and in Writing - Create a thorough
partnership or LLC agreement that provides the full details of each party's specific
obligations, with timelines for performance, as well as specific steps that can be
taken by the aggrieved party when the other party fails to fulfill its obligations. The
partnership or LLC agreement is what the parties have to protect them when things
go wrong, and the more detail there is in the document, the easier, faster and
cheaper it will be to resolve any problems if and when they arise or, if need be,
unwind the joint venture if it is not possible to continue.
4. Deal with Conflicts of Interests Up Front- If there are inherent conflicts between
ventures (i.e., a manager/owner conflict) get those out on the table at the beginning
and resolve them or resolve the method for resolution before engaging in any
serious negotiations. For this process to work, the partners have to understand and
agree that they cannot have secrets from each other on matters that involve the
venture. If there are issues that likely will cause parties to distrust each other's
motivations, set up a process that forces conversation and resolution within a
specified time period.
5. Joint Venture Hotel Projects in India:
Maharaja Hotel Resort Limited: Maharaja Hotels Resort Limited has an
ownership interest of 50%
InterContinental Hotels Group, the world's top hotelier, signed a joint venture
partnership with Duet India Hotels Group to develop its Holiday Inn Express
brand in the Indian market.
CHAPTER 14
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In the year 2000, hospitality in India was primarily dominated by the domestic players,
namely Taj Group of Hotels, Oberoi Hotels & Resorts, ITC Hotels, and the government
owned ITDC (The India Tourism Development Corporation Ltd) Hotels, with only a handful
of international brands having a token presence in the form of marketing alliances in India.
Also, while some of today's home-grown hotel chains like Leela, Bharat Hotels, Sarovar and
Asian Hotels were around at that time, they were for the most part single-asset owners. There
was a perception that India was a tough place for foreign companies to do business in and that
a strong local presence with excellent contacts was required to be able to penetrate this
market. Additionally, several businesses and consequently most international brands were
more focused on fast-growing markets in the Middle East and China, which offered more
opportunities for growth at that time.
The economic downturn, at the beginning of the decade, led to a paradigm shift among these
businesses as they could no longer depend solely on the more mature economies and they
started gauging the vast opportunities that a country like India had to offer. The fact that India
was less impacted by the global downturns - one at the beginning of the decade and the other
at the end of it - as compared to the rest of the world has emphatically proven the inherent
strength of the Indian economy and its consumer base of over a billion people. As Indians
travelled more frequently around the world, they experienced international hotel brands firsthand, as a result of which these brands enjoyed greater recognition and acceptance in India.
Additionally, as international visitation to India increased, the foreign brands were better
placed to attract these visitors due to their strong reservations networks around the world.
With the continued growth in India's GDP, improvement in the per capita income, and
increased aspirational spending, the Indian hospitality sector is expected to grow faster than
most countries around the world. Most major hotel brands such as Starwood, Hilton, Marriott,
Hyatt and Accor already have a growing presence in India and they have an even stronger
pipeline. Additionally, the emergence of a branded budget and economy segment presents
tremendous opportunities and will attract many new players to an India going forward.
Key Game Changers:
Entry of most major international brands
49
Changing perception of Indian markets as a lucrative opportunity among international

brands
Growth of the Indian middle class offering a large consumer base of more than 1
billion people
Educated and well exposed Indian audiences, likely to accept global brands
wholeheartedly
Expected emergence of branded budget and economy hotels

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CHAPTER 15
In the past ten years most commodity prices have gone up. Development costs have always
been a challenge for anyone looking to build a hotel in India. The land cost has increasingly
become a significant portion of the development cost for any project, accounting for 30-50%
of the total development cost, while the same equates to about 15-20% internationally. The
high density of development within Indian cities and the shortage of vacant land parcels
suitable for hotels had led to aggressive bidding wars among prospective buyers and forced
prices upwards. With the increased pace of construction activity around the world, especially
in the Middle East and China, the price of construction material such as steel and concrete
increased steeply in recent years. While this was offset by sourcing furniture and fixtures from
China by several recent hotel projects, the additional concern regarding the quality of Chinese
goods is one that now needs to be addressed.
HVS observes that hotels built in India very often exceed the brand specifications that might
exist for these brands internationally and that developers often tend to spend more money on
their hotels than required. A typical mid-market business hotel in the US or Europe, thus, does
not cost nearly as much to construct as it does in India.
The lengthy cumbersome process of obtaining licenses and permits and construction delays
serves to increase costs even more. Given the time and expense involved in working through
all these issues and finally opening a hotel, developers who managed to do so were not
interested in selling their hotels or asked for prices that were far in excess of replacement cost.
As we look into the next ten years, we believe that as long as asking prices remain
significantly higher than the replacement cost for the product, developers and investors will
choose to build rather than buy.
Positioning
Luxury
Upper Upscale
Upscale
Mid Market
Budget
Economy
50
Typical Development Cost per Key (INR)

12,500,000 and above
8,500,000 to 12,500,000
6,000,000 to 8,500,000
3,500,000 to 5,500,000
2,500,000 to 3,500,000
2,500,000 and below
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Key Game Changers:
Likely rationalization of land costs, due to the recent economic conditions
Increased import of material from global sources, as long as quality goods are
available
Expected rationalization of costs, with government intervention in relaxing the license
process
Expected rationalization of per key development costs, with entry of brands across all
positioning
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CHAPTER 16
The 4 Ps of marketing are Product, Price, Place, and Promotion. Think of each of these as a
variable which you control. The idea is to set these variables in such a way so that sales will
take place. You cannot "make" a customer pull out her credit card, but you can certainly help
her in coming to a decision by setting the "right" price, the retail location, the level of
advertising and even product attributes such as color or perceived quality. You control
everything but the customer herself. These variables are all interdependent. Taken together,
they constitute a certain mix.
PRODUCT:
In the hospitality industry the service that the hotel provides and the other products that the
hotel provides are the facilities the rooms the restaurants the hotel has It's fully refurbished
guest rooms and highly personalized services, make you feel comfortable and cared for,
miles away from home the product that the armadas is into is always to keep the guests happy
who enter and leave their premises
PRICE
Price is not just the sticker price or the price invoiced. It goes deeper. the Ramada is one of the
only 5 star hotels in Goa that has prices that even a common man can avail of on grand
occasions they have a price tag which varies for different persons requirements may from any
walk of life Ramada is a good price package that fits every ones budget due to which they do
not face competition from other hotels
PLACE:
Exclusive international 5 star deluxe hotel located in Gurgaon with 370rooms
PROMOTION:
The year 2010 is a different story as the consumer is well educated, travelled, experienced and
looks beyond the gloss of the brand to the value proposition and the actual delivery of brand
promises. Thus, in the Year 2010, the marketing mantras are differentiation, consistency,
customer satisfaction, delivery of brand promises and customer retention. Today, Brand 2010
has evolved from a one-way communication stream to a two-way one that is more flexible
and accommodates the customer's needs and wants. Hence, Brand 2010 is a product of the
External Stakeholder the needs and wants of the Customers accented by experience led,
sustainable Brand Promises which now translates into the Purchase Decision of 2010. The
state of economic flux wherein each dollar spent is being analyzed, renegotiated and then
minimized, the marketing dilemma of marketing spend vs. incremental revenue assumes more
importance. How do marketing resources of the Indian Hospitality sector continue to build
their brand and market their product successfully? Consistent delivery of a superior and
differentiated product experience that offers a greater perceived value will result in the
acquisition and retention of customers. The pressure on consistent delivery of brand promises
is further maintained by online customer feedback which impacts the attraction quotient of the
product for other prospective customers. Customers in the coming decade will want to 'Find
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Even Before they seek' and the advent of social networking has given a new power to
customers like none other before.
Key Game Changers:
Broadening of the playing field with entry of many domestic and international hotel
chains
Well educated, travelled and experienced customer base
Evolution of the brand from a one-way communication stream to a two-way one that
accommodates customer needs and experiences
Consistent delivery of brand promises and customer experiences
Marketing equations changing in favour of the customer with online channels like
Web 2.0 and social networking
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CHAPTER 17
STRENGHT
India has a rich cultural heritage. The "unity in diversity" tag attracts most tourists.
Indian hotel industry is facing a mismatch between the demand and supply of rooms
leading to higher room rates and occupancy levels.
India's share in international tourism and hospitality market is expected to increase over
the long-term.
Manpower costs in the Indian hotel industry are one of the lowest in the world. This
provides better margins for Indian hotel industry.
India offers a readymade tourist destination with the resources it has. Thus the magnet
to
pull customers already exists and has potential grow.
WEAKNESSES
The lack of adequate recognition for the tourism industry has been hampering its
growth prospects. Whatever steps are being taken by the government are implemented at a
slower pace.
High tax structure in the industry makes the industry worse off than its international
equivalent. In India the expenditure tax, luxury tax and sales tax inflate the hotel bill by over
30%.
The cost of land in India is high at 50% of total project cost as against 15% abroad.
This acts as a major deterrent to the Indian hotel industry.
The hotel industry in India is heavily staffed. This can be gauged from the facts that
while Indian hotel companies have a staff to room ratio of 3:1, this ratio is 1:1 for
international hotel companies.
OPPURTUNITIES
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Rising Income: While there has been much talk about record number of foreign
tourist arrivals, very little has actually been said or done about domestic tourism,
which, according to our estimates, has registered a 40% annual growth in the last three
years.
Per capita income grew by an impressive 8.9% in 2009, while Gross Domestic
Savings touched an all time high of 33%.
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Open sky benefits: The opening up of the aviation industry in India brings exciting
opportunities for the hotel industry (airlines transport around 80% of international
tourists).
Forign Trade Policy: Hotels and Restaurants are allowed to import duty free
equipments and other items including liquor, against their foreign exchange earnings
under the Served from India Scheme.
New business opportunities: We believe that, over the next three to five years, the
biggest surge in accommodation demand is expected to come from commercial zones
that are being developed in metro suburbs and secondary markets. Mixed-use
development projects that include retail and commercial space have also gained
momentum in the last 24 months and will continue to be an attractive option. This
provides a unique opportunity for hospitality projects. Also the new concept, which is
going to gain importance, is that of budget hotels.
Hotel Industry in India currently has supply of 110,000 rooms and there is a shortage
of 150,000 rooms fueling hotel room rates across India. According to estimates
demand is going to exceed supply by at least 100% over the next 2 years.
It is forecasted to be the number 3 market in the world by 2015 for hospitality and
tourism.
Demand between the national and the inbound tourists can be easily managed due to
difference in the period of holidays. For international tourists the peak season for
arrival is between September to March when the climatic conditions are suitable
where as the national tourist waits for school holidays, generally the summer months.
In the long-term the hotel industry in India has latent potential for growth. This is
because India is an ideal destination for tourists as it is the only country with the
most diverse topography. For India, the inbound tourists are a mere 0.49% of the
global figures. This number is expected to increase at a phenomenal rate thus pushing
up the demand for the hotel industry.
The share of convention or meetings tourism is miniscule in India in comparison to
international standards, which accounts for over 20.0% of all international arrivals.
International hospitality chains are expected to acquire local players to increase their
presence in the country.
Domestic and international players are expected to form strategic alliances and
partnerships with regional players to expand in the country, reduce risk and optimize
resources.
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Below is the table representing new hotel opportunities across the country in next five
years.
Cities
Agra
Pune
Bengaluru
Chandigarh
Chennai
Delhi NCR
Goa
Hyderabad
Jaipur
Kolkata
Mumbai
Other Cities
Total
Existing
1,439
2,672
5,597
653
3,806
11,018
3,288
3,782
2,472
1,520
9,877
14,759
62,404
Supply
510
5,196
9,819
1,482
5,995
20,021
1,736
5,302
2,664
3,481
7,477
23,427
89,449
Proposed
35%
194%
175%
227%
158%
182%
53%
140%
108%
229%
76%
159%
143%
Inc in
Five yrs
41%
67%
65%
76%
72%
75%
41%
63%
77%
51%
60%
65%
67%
Develop
ment
11.8%
14.5%
16.9%
11.1%
24.1%
26.7%
18.2%
29.4%
8.2%
28.0%
42.5%
2.3%
18.0%
Luxury
22.0%
31.7%
37.7%
22.1%
28.0%
31.4%
49.1%
28.3%
61.3%
37.2%
22.6%
28.7%
32.0%
First
Class
52.5%
34.1%
22.7%
54.7%
22.3%
25.4%
24.8%
18.2%
22.5%
34.9%
20.6%
47.5%
31.0%
Mid-Market
Budget
Extended Stay
13.7%
19.7%
15.5%
12.1%
13.7%
13.9%
7.9%
20.0%
8.0%
0.0%
14.4%
20.5%
16.0%
THREATS
Event risk: Dependency on foreign tourism can be a double-edged sword as travel
decisions are based on global patterns and events that happen elsewhere can have
serious impact the performance.
Increasing competition: Global hospitality majors like the Four Seasons, Shangri-La
and Aman Resorts are all making their entry into the Indian market. They are not the
only ones who are turning their attention to India. The Hilton Group is deciding on a
comeback and has tied up with the Oberoi Group. Two other groups - the Carlson
Group and the Marriott chain are furiously hunting for new hotels in India's top cities.
This will increase the competition for the existing Indian hotel majors.
Lack Of Infrastructure: Indias poor domestic hospitality structure is leading to
threat a losing foreign tourist to other competing countries. Like terrorist strike, riots,
epidemics, political uncertainity, slowdown in reforms etc.
Growing Land Cost: Land costs have become increasingly important for any project,
accounting for around 30.0-50.0% of the total development cost, as opposed to to
about 15.0-20.0% internationally.
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Regulatory Hurdles: Compliance with a number of regulations related to the

preparation and sale of food and beverages, and various laws and regulations
governing employee relationships. Hotel owners and operators need to obtain multiple
licenses, permits and authorizations, including local land-use permits, building and
zoning permits, environmental, and safety permits and liquor licenses.
Customer expectation: With the emergence of India on global travel map, expectation
of customer are arising, making companies focus on customer loyalty and repeat
purchase.
Image of the country: The competition from neighboring countries and negative
perceptions about the Indian tourism product constrains the growth of tourism. The
image of India as a country overrun by poverty, political instability, safety concerns
and diseases also harms the tourism industry.
Manual Bach End: The majority of the operations data in a hotel is filed in manual
log books or is not tracked. Although most reputed chains have implemented IT
systems for property management and reservations.
Human Resource Development: The sector has been focusing on the development of
white collar jobs as opposed to blue collar jobs, leading to a shortage of blue collar
employees, which might pose various threats to the industry.
Shortage of Skilled Labours: The lack of a quality workforce and low retention
levels of good professionals at different skill levels is hampering the growth of the
hospitality industry.
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CHAPTER 18
The hotel industry in India is going through an interesting phase. One of the major reasons for
the increase in demand for hotel rooms in the country is the boom in the overall economy and
high growth in sectors like information technology, telecom, retail and real estate. Rising
stock market and new business opportunities are also attracting hordes of foreign investors
and international corporate travellers to look for business opportunities in the country.
Development of new products

Emergence of newer concepts and forms is also aiding growth in the industry. Bed and
Breakfast is one such recent concept in the Indian market. To tap this potential, GoI is
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recognising spare rooms available with various home owners by classifying these facilities as
the Incredible India Bed and Breakfast Establishments.
These newer forms of tourism ecotourism, agritourism, cruise tourism are still at a
nascent stage and they hold immense potential. Once adequate measures are taken, these
forms of hospitality can drive strong growth in the industry. In line with these new concepts
and taking into account the requirements of different types of travelers, hotel companies are
offering customised and attractive accomdation packages.
World-class medical facility
The popularity of India as a major medical destination has also aided growth in the hotel
industry in cities such as Delhi and Gurgaon. Many people from the developed countries
come to India for the rejuvenation promised by yoga and Ayurvedic treatments. Furthermore,
a nice blend of top-class medical expertise at attractive prices is enabling more Indian
corporate hospitals to get patients from the developed nations. Most common treatments for
which foreigners come to India are heart surgery, knee transplant, cosmetic surgery and
dental care.
Hosting of international events
Events such as trade fairs, exhibitions, and sports events tend to bring about higher tourist
movement mutuating growth in Hotel Industry. International events held in the country lead
to higher inbound hospitality
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CHAPTER 19
Guest Feedback Program

The best way to know how well the hotel is doing is to ask guests. The Grand Five Star
Hotel will provide evaluation tool that our properties can easily administer to our guests, in
order to have most effectively measure performance and engage in continuous quality
improvement. Our guest feedback program will provide immediate results, so that hotel can
take swift corrective action.
Quality Control Services
The Grand Five star Hotel will looks at operation of hotel from the guest perspective. It will
follow the path of the guest from the first encounter via phone or website through the entire
experience of their stay. The approach includes meaningful customer service decisions.
Safety Audit
The loss prevention specialists will be trained to evaluate a property for total loss prevention
and assisting in the identification of hot spots on safety. We will provide our portfolio of
hotels with complete training programs for hotel managers and line employees. In addition, we
wil provide manuals and programs for the ongoing maintenance of the property safety
program.
Manager on Duty Program
We will provide comprehensive, individualized "manager on duty programs," including policy
manuals, procedures and reports.
Employee Survey Program
Positive employee morale translates into positive customer experiences. The Grand five star
Deluxe Hotel survey tool will enable our hotels to gauge employee morale. This objective
survey determines areas of opportunity, weakness and strength among the property-level
workforce. It enables hotel general managers and executive staff to take constructive steps to
ensure maximum productivity and customer service.
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Five Star Deluxe Hotel
Project Report of The Grand
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CHAPTER 20
In the Indian hospitality industry the major players are Indian Hotels, EIH, ITC hotels, Hotel Leela
Ventures, Bharat Hotels and Asian Hotels, ITDC and Orient Hotels Ltd.
The booming industry has attracted many international players as well. A number of global players
are already well established in India. These include Hilton, Shangri-La, Radisson, Mariott,
Meridian, Sheraton, Hyatt, Holiday Inn, InterContinental and Crown Plaza.
The country has been flooded by some of the world's leading hotel brands. New brands such as
Amanda, Satinwoods, Banana Tree, Hampton Inns, Scandium by Hilt and Mandarin Oriental are
planning to enter the Indian hospitality industry in joint ventures with domestic hotel majors.
International Hotel Brands
Brand
No. of
Target
hotels
date
Carlson
50
2012
Four Seasons
2012-13
Starwood
15
2012
Hyatt
10
2012-13
Marriott
24
2012
Wyndham
50
2011
Hilton
75
2015
Intercontinental
41
2012
Fairmont Raffles
15
2012-13
Accor
44
2012
Source: Business Standard
DELUXE FIVE STAR HOTELS

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Hotels
Description
The Oberoi
The Oberoi is a modern, luxury hotel, the best of its kind in

India. Guests here can be assured of personal service and every
21st century convenience for a comfortable and relaxing stay.
Oberoi Hotels have achieved different award in hospitality.
Galaxy Hotel
Galaxy hotel is located in the commercial hub of Gurgaon in

the National Capital Region, New Delhi. Placed conveniently
off NH 8, Galaxy hotel is a half mall and half hotel, which offer
a budget accommodation in Gurgaon, for business and leisure
travelers. Well designed, Galaxy is among five star hotels in
Gurgaon that is unique in concept and service.
Hyatt Regency
Hyatt Regency Delhi has 508 guest rooms that are tastefully
decorated. The guest rooms at Hyatt Regency New Delhi have
been divided into Presidential Suites, Executive Suites,
Regency Deluxe Suites and Terrace Suites. As well as the
Regency Club rooms, the Pool-facing rooms and the Hyatt
guest rooms at the Hyatt Regency Hotel.
Trident Hilton, Gurgaon
Trident Hilton, is one of the topnotch hotels in India. It is

situated in the National Capital Region and was voted as 'India's
Leading Business Hotel for 2005' in London at World Travel
Awards. The hotel is situated on 7 acres of land and is known
for its long corridors, walkways, inner courtyards, pools, domes
and fountains.
The Bristol Hotel, Gurgaon
Bristol Hotel offers 83 well equipped rooms. It is situated in

commercial hub of Gurgaon.
The Indian Hotels Comapany
The Indian hotels Company and subsidiareies are collectively

known as Taj Hotels Resorts and Places, recognised as one of
the Asias largest and finest hotelcompany.Incorporated by the
founder of Tat Group. Taj Hotels and Places comprises of 59
hotels and40 locations
20.1 OBEROI GROUP OF HOTELS

62
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The Oberoi Group, founded in 1934, operates 27 hotels and three cruisers in five countries
under the luxury Oberoi and five-star Trident brands. The Group is also engaged in flight
catering, airport restaurants, travel and tour services, car rentals, project management and
corporate air charters.
Oberoi Hotels & Resorts is synonymous the world over for providing the right blend of
service, luxury and quiet efficiency. Internationally recognised for all-round excellence and
unparalleled levels of service, Oberoi Hotels & Resorts has received innumerable awards and
accolades.
A distinctive feature of The Groups hotels is their highly motivated and well trained staff that
provides the kind of attentive, personalised and warm service that is rare today. The Groups
new luxury hotels have established a reputation for redefining the paradigm of luxury and
excellence in service amongst leisure hotels around the world. Trident hotels are five-star hotels
that have established a reputation for excellence andare acknowledged for offering quality and
value. These hotels combine state of the art facilities with dependable service in a caring
environment, making them the ideal choice for business and leisure travellers. Recognising the
importance of quality training in hospitality management, The Oberoi Group Established The
Oberoi Centre of Learning and Development in New Delhi in 1966. The Group is committed to
employing the best environmental and ecological practices in technology, equipment and
operational processes. The Oberoi Group also supports philanthropic activities that range from
education to assistance for the mentally and physically challenged. The Group is also a keen
contributor to the conservation of nature and of cultural heritage.
20.1.1Rai Bahadur Mohan Singh Oberoi Founder Chairman, EIH Limited

(1898 - 2002) Early Life
Rai Bahadur Mohan Singh Oberoi was born on 15th August, 1898 in erstwhile undivided
Punjab, which is now in Pakistan. He was only six months old when his father died. Success
and fortune did not, therefore, come easily to him. Initiative, resourcefulness and hard work,
combined with the capability to face and overcome the most overwhelming odds can best
characterise this phenomenal entrepreneur.
Mohan Singh completed his primary education in Rawalpindi and moved to Lahore for his
Bachelor's degree. Shortly thereafter, to flee the ravages of a virulent plague, he went to seek his
fortune in Shimla, the summer capital of British India. Arriving penniless, he found a job at a
monthly salary of INR 50, as the front desk clerk at the Cecil Hotel. Today, The Oberoi Group
owns the hotel The Oberoi Cecil where the young Mohan Singh found his metier. The diligence,
enthusiasm and intelligence displayed by Mohan Singh impressed Mr. Grove, the manager of
the hotel. A quick learner, Mohan Singh did not restrict his efforts to fulfilling the job
description of a desk clerk but sought and shouldered additional responsibilities. A few years
later, when a Mr. Clarke acquired a small hotel he asked Mr. Oberoi to assist him. It was here, at
Clarkes Hotel, that Mohan Singh gained first hand experience in all aspects of operating a hotel.
20.1.2 Budding Entrepreneur

In 1934, Mr. Oberoi acquired his first property, The Clarkes Hotel, from his mentor by
mortgaging his wife's jewellery and all his assets. Four years later, he signed a lease to take over
63
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operations of the five hundred rooms Grand Hotel in Calcutta that was on sale following a
cholera epidemic. With his customary confidence and sheer determination to succeed, he was
able to convert this hotel into a highly profitable business venture.
Over several years, Mr. Oberoi had purchased shares in Associated Hotels of India (AHI), which
owned Cecil and Corstophans hotels in Shimla, Maidens and Imperial hotels in Delhi and a
hotel each in Lahore, Murree, Rawalpindi and Peshawar. In 1943, Mr. Oberoi acquired
controlling interest in AHI. He thus became the first Indian to run the country's largest and finest
hotel chain. In the tumultuous years just prior to Indian independence, Mr. Oberoi met and
intimately interacted with the would-be leaders of Free India, all of whom were, at one time or
other, guests at his hotels.
20.1.3 International Pioneer

Having consolidated his early ventures, Mr. Oberoi became the first Indian hotelier to enter into
an agreement with an internationally renowned hotel chain, to open the first modem, five-star
hotel in the country. The Oberoi Inter Continental, in New Delhi opened in 1965.The I-Con, as
it became popularly known, offered facilities that no other hotel in the country matched and was
India's first luxury hotel.
This achievement was enhanced with the opening of the 35-storey Oberoi Sheraton in Bombay,
in 1973. Mr. Oberoi was the first Indian to work in association with international chains to woo
international travellers to India. This led to a heavy influx of international travellers and foreign
occupancy soared to an average of 85%. This enabled The Oberoi Hotels to significantly
contribute to India's foreign exchange earnings.
Another pioneering landmark was the establishment in 1966 of the prestigious Oberoi School of
Hotel Management, recognised by the International Hotel Association in Paris. Considered
India's premier institute, the school is now known as The Oberoi Centre of Learning and
evelopment and continues to provide high quality professional training in hospitality
management. Other notable firsts were the decision to employ women in his hotels and to
establish a chain of ancillary industries producing and supplying items like consumables and
stationery to ensure the highest quality. The Oberoi Group was also the first to start flight
catering operations in India, in 1959. The Oberoi Flight Services, located in New Delhi,
Mumbai, Cochin and Chennai, provide in-flight meals of international quality to reputed
airlines.
Mr. Oberoi realised that the hotel and hospitality business is greatly dependent on travel agents,
a vital element in the distribution chain. Therefore, he decided to establish his own travel
agency. Mercury Travels, part of The Oberoi Group, ranks amongst the leading travel agencies
in India. With vision and imagination, Mr. Oberoi converted old and dilapidated palaces,
historical monuments and buildings into magnificent hotels such as The Oberoi rand in
Calcutta, the historic Mena House in Cairo and The Windsor in Australia. It was, in fact, in the
face of severe opposition that the State Government of Victoria awarded Mr. Oberoi the lease of
The Windsor, a heritage building in Melbourne. He personally supervised the Restoration of the
hotel to its original grandeur and later acquired it. The Oberoi Cecil in Shimla, built in the early
20th century, reopened in April 1997 after extensive and meticulous renovation.
20.1.4 Awards and Honours
64
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In 1943, Mr. Oberoi was conferred the title of Rai Bahadur by the British Government in
recognition of his services to the Crown. Thereafter, Mr. Oberoi won acclaim and received
several national and international awards including admission to the Hall of Fame by the
American Society of Travel Agents (ASTA) and Man of The World award by the International
Hotel Association (IHA), New York. He was presented the Order of The Republic, First Class
by the President of Egypt. He got an Honorary Doctorate of Business Administration from the
International Management Centre, Buckingham, UK. Newsweek named him one of the Elite
Winners of 1978. The PHDCCI Millennium award in 2000 was presented in recognition of his
entrepreneurial and business success. In 2001, the Government of India accorded him the
Padma Bhushan.
20.1.5 Globalisation of The Oberoi Group
To place The Oberoi Group on the world map, Mr. Oberoi exported management expertise to
Australia, Egypt and Singapore, where The Oberoi Group took charge of the management of
existing luxury hotels. The success of Oberoi Hotels & Resorts overseas, in the face of global
competition, greatly enhanced the image of The Group Today, Oberoi Hotels & Resorts in
fudonesia, Egypt, Mauritius, Saudi Arabia and India add value and distinction to their host
countries.
20.1.6 Mission & Vision Of Oberoi Group Of Hotels
Our Guests
We are committed to meeting and exceeding the expectations of our guests through our
unremitting dedication to every aspect of service.
Our People
We are committed to the growth, development and welfare of our people upon whom we rely
to make this happen.
Our Distinctiveness
Together, we shall continue the Oberoi tradition of pioneering in the hospitality industry,
striving for unsurpassed excellence in high-potential locations all the way from the Middle
East to Asia-Pacific.
Our Shareholders
As a result, we will create extraordinary value for our stakeholders.
20.1.7 Vision Of Oberoi Group Of Hotels
65
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We see an organization which aims at leadership in the hospitality industry by understanding its
guests, and designing and delivering products and services which enable it to exceed their
Expectations.
We will always demonstrate care for our customers through anticipation of their needs, attention
to detail, distinctive excellence, warmth and concern.
We see a lean, responsive organization where decision making is encouraged at each level and
which accepts change. It is committed and responsive to its guests and other stakeholders.
We see a multi-skilled workforce, which consists of team players who have pride of ownership,
translating organizational vision into reality.
We see a multi-skilled workforce, which consists of team players who have pride of ownership,
translating organizational vision into reality.
We see an organization where people are nurtured through permanent learning and skill
improvement, and are respected, heard and encouraged to do their best. Oberoi is recognized as
best practice for training and developing its people.
We see a more multinational workforce which has been exposed to different cultures, problems
and situations and can use its experiences to enrich the local employees whether in India or
overseas.
We see user-friendly technology enhancing value for our customers and helping our personnel
by making information more accessible.
We see an organization which is conscious of its role in the community, supporting social needs
and ensuring employment from within the local community.
We see an organization which is committed to the environment, using natural products and
recycling items, thus ensuring proper use of diminishing natural resources.
20.1.8 DIFFERENT TYPES OF OBEROI HOTELS

66
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Business Hotels
Oberoi Hotels & Resorts is synonymous the world over with providing the right blend of luxury,
warm service and quiet efficiency. Internationally recognised for all-round excellence and
unparalleled levels of service, the business travellers acknowledge Oberoi Hotels & Resorts as
amongst the finest.
This was reaffirmed recently in Cond Nast Traveler, Business Travel Awards, a readers poll of
business travellers, in which Oberoi Hotels & Resorts was rated the best hotel chain in the world
(outside the United States).
The Oberoi, New Delhi The Oberoi, Mumbai The Oberoi, Bangalore The Oberoi Grand,
Kolkata
Leisure Hotels
Oberoi Hotels & Resorts is synonymous the world over with providing the right blend of luxury,
warm service and quiet efficiency. Luxury as a unique, memorable and personal experience is
core to the Oberoi philosophy. It encompasses every element of a guests stay at the Oberoi
hotels that creatively combine breathtaking locations, luxurious environs and the best of modern
amenities with personalised and warm service delivered with genuine care. The design and
architecture of the hotels, is inspired by the historical style of the region. This coupled with
luxurious interiors that replete with local arts and crafts, to menus that offer an extensive
selection of local specialties and classical and folk dance and music performances.
The Oberoi Amarvilas, Agra The Oberoi Rajvilas, Jaipur The Oberoi Udaivilas , Udaipur The
Oberoi Vanyavilas, Ranthambhore Wildflower Hall, Shimla in the Himalayas The Oberoi Cecil,
Shimla Mena House Oberoi, Cairo The Oberoi, Sahl Hasheesh,Red Sea,Egypt The Oberoi, Bali
The Oberoi, Lombok The Oberoi, Mauritius
Cruises
Oberoi Hotels and Resorts offer unparalleled luxury cruise experiences, on the Nile and the
Kerala Backwaters. The right blend of impeccable service, luxury and quiet efficiency,
hallmarks of Oberoi Hotels & Resorts worldwide, make the stay onboard the Luxury Cruisers
memorable.
The Oberoi, Motor Vessel Vrinda, Kerala The Oberoi Philae, Nile Cruiser The Oberoi
Zahra, Luxury Nile Cruiser
Spas
Oberoi Spas provide a serene and truly unforgettable experience of pure pampering and
relaxation in exquisitely beautiful surroundings, using holistic therapies and massages which
combine the very best of Eastern and Western practices. Expert in the use of Western &
traditional Eastern techniques, only highly skilled and trained therapists are handpicked for our
hotels and resorts. Oberoi Spa recipes feature only the finest natural ingredients, often local to
the resort and the Oberoi Group are committed to remaining true to the Asian tradition of
respect for the environment. The extraordinary levels of comfort and service that guests expect
from Oberoi reach a peak in the Oberoi Spas, world-acclaimed pioneers of the tropical spa
experience.
PRODUCT PROFILE OF OBEROI GROUP OF HOTELS
67
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The group is committed to employing the best environmental and ecological practices in
technology, equipment and operational processes. The Oberoi group also supports hilanthropic
activities that range from education to assistance for the mentally and physically challenged.
The group is also keen contributor to the conservation of nature and of cultural heritage.
20.1.9 SWOT ANALYSIS OF OBEROI & TRIDENT

Strengths
Cost advantage
Asset leverage
Effective communication
High R&D
Innovation
Online growth
Loyal customers
Market share leadership
Strong management team
Strong brand equity
Weaknesses
Bad communication
Diseconomies to scale
Over leveraged financial position Low R&D
Low market share
No online presence
Not innovative
Not diversified
Poor supply chain
Weak management team
Weak real estate
Opportunities
Acquisitions
Asset leverage
Financial markets (raise money through debt, etc)
Emerging markets and expansion abroad
Innovation
Online
Product and services expansion
Takeovers
68
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Threats
Competition
Cheaper technology
Economic slowdown
External changes (government, politics, taxes, etc)
Exchange rate fluctuations
Lower cost competitors or imports
Maturing categories, products, or services
Price wars
69
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20.1.10 SHAREHOLDING PATTERN OF OBEROI GROUP OF HOTELS
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu
Undivided Family
Bodies Corporate
Sub Total
(2) Foreign
Total shareholding of
Promoter and Promoter
Group (A)
(1) Institutions
Mutual Funds / UTI
Financial Institutions /
Banks
Insurance Companies
Foreign Institutional
Investors
Sub Total
(2) Non-Institutions
Bodies Corporate
Individuals
Individual shareholders
holding nominal share
capital up to Rs. 1 lakh
Individual shareholders
holding nominal share
capital in excess of Rs. 1
lakh
Any Others (Specify)
Non Resident Indians
Foreign Nationals
Trusts
Directors & their Relatives
& Friends
Sub Total
Total Public shareholding
(B)
Total (A)+(B)
(C) Shares held by
Custodians and against
which Depository
Receipts have been
issued-m
Sub Total
70
5
9
14
26,352,663
171,475,834
197,828,497
26,352,663
171,475,834
197,828,497
4.61
30.02
34.63
4.61
30.00
34.61
14
197,828,49
7
197,828,497
(B) Public Shareholding
34.63
34.61
11
943,912
905,587
0.17
0.17
43
9
933,446
72,923,139
908,106
72,923,139
0.16
12.77
0.16
12.76
50
113
11,888,521
86,689,018
11,881,502
86,618,334
2.08
15.18
2.08
15.17
1,816
211,220,849
-
211,181,248
-
36.98
-
36.95
-
85,820
65,354,595
51,613,214
11.44
11.43
48
853
836
9,023,049
1,120,376
1,056,302
8,972,019
917,417
892,731
1.58
0.20
0.18
1.58
0.20
0.18
6
10
38,953
24,686
24,686
0.01
-
0.01
-
1
88,537
435
286,718,869
272,683,898
50.19
50.16
88,650
88,664
373,407,887
571,236,384
359,302,232
557,130,729
65.37
100.00
65.33
99.94
333,030
332,655
0.06
Gh
Total (A)+(B)+(C)
88,666
571,569,414
557,463,384
100.00
Balance Sheet of Oberoi Group Of Hotels
Sources Of Funds
Total Share Capital
Equity Share Capital
Share Application Money
Preference Share Capital
Reserves
Revaluation Reserves
Networth
Secured Loans
Unsecured Loans
Total Debt
Total Liabilities
Application Of Funds
Gross Block
Less: Accum. Depreciation
Net Block
Capital Work in Progress
Investments
Inventories
Sundry Debtors
Cash and Bank Balance
Total Current Assets
Loans and Advances
Fixed Deposits
Total CA, Loans &
Advances
Deffered Credit
Current Liabilities
Provisions
Total CL & Provisions
Net Current Assets
Miscellaneous Expenses
Total Assets
71
(fig In Cr.)
Mar '11
12 mths
Mar '10
12 mths
Mar '09
12 mths
Mar '08
12 mths
Mar '07
12 mths
114.31
114.31
0.00
0.00
2,241.24
232.25
2,587.80
823.97
0.00
823.97
3,411.77
Mar '11
12 mths
78.59
78.59
0.00
0.00
1,103.25
235.25
1,417.09
1,174.54
85.00
1,259.54
2,676.63
Mar '10
12 mths
78.59
78.59
0.00
0.00
1,100.79
238.25
1,417.63
1,019.33
0.00
1,019.33
2,436.96
Mar '09
12 mths
78.59
78.59
0.00
0.00
985.39
241.25
1,305.23
800.87
12.00
812.87
2,118.10
Mar '08
12 mths
78.59
78.59
0.00
0.00
851.33
244.25
1,174.17
693.82
97.81
791.63
1,965.80
Mar '07
12 mths
2,619.69
563.38
2,056.31
127.59
605.14
33.67
126.56
63.13
223.36
306.85
531.16
2,486.09
488.05
1,998.04
174.46
378.24
30.06
99.22
10.39
139.67
384.91
3.39
1,828.99
432.92
1,396.07
586.85
349.81
30.36
92.20
23.86
146.42
369.40
18.25
1,726.87
390.63
1,336.24
425.16
358.81
33.26
114.37
22.48
170.11
231.02
3.94
1,497.64
369.11
1,128.53
375.83
411.81
30.34
101.27
44.59
176.20
416.18
5.98
1,061.37
0.00
363.33
75.31
438.64
622.73
0.00
3,411.77
527.97
0.00
335.13
66.94
402.07
125.90
0.00
2,676.64
534.07
0.00
362.62
67.23
429.85
104.22
0.00
2,436.95
405.07
0.00
315.23
93.68
408.91
-3.84
1.73
2,118.10
598.36
0.00
272.04
285.25
557.29
41.07
8.55
1,965.79
Gh
Profit & Loss of Oberoi Group Of Hotels
Income
Sales Turnover
Excise Duty
Net Sales
Other Income
Stock Adjustments
Total Income
Expenditure
Raw Materials
Power & Fuel Cost
Employee Cost
Other Manufacturing
Expenses
Selling and Admin Expenses
Preoperative Exp Capitalised
Total Expenses
Operating Profit
PBDIT
Interest
PBDT
Depreciation
Other Written Off
Profit Before Tax
Extra-ordinary items
PBT (Post Extra-ord Items)
Tax
Reported Net Profit
Total Value Addition
Preference Dividend
Equity Dividend
Corporate Dividend Tax
Per share data (annualised)
Shares in issue (lakhs)
Earning Per Share (Rs)
Equity Dividend (%)
Book Value (Rs)
Mar '10
12 mths
Mar '09
12 mths
Mar '08
12 mths
Mar '07
12 mths
968.60
0.00
968.60
161.57
0.00
1,130.17
774.13
0.00
774.13
130.51
0.00
904.64
888.67
0.00
888.67
179.62
0.00
1,068.29
1,079.87
0.00
1,079.87
60.86
0.00
1,140.73
938.97
0.00
938.97
98.84
0.00
1,037.81
0.00
72.69
318.88
0.00
59.45
244.80
0.00
63.67
250.60
0.00
63.51
232.81
0.00
53.29
196.46
201.58
159.77
47.62
0.00
800.54
Mar '11
168.06
329.63
155.19
174.44
87.44
0.00
87.00
-3.89
83.11
18.57
64.54
800.54
0.00
51.44
7.14
170.79
131.65
40.04
0.00
646.73
Mar '10
127.40
257.91
100.89
157.02
68.03
0.00
88.99
-0.30
88.69
31.46
57.23
646.73
0.00
47.15
7.62
153.57
153.21
37.23
0.00
658.28
Mar '09
230.39
410.01
82.50
327.51
54.24
0.00
273.27
-0.50
272.77
102.32
170.44
658.28
0.00
47.15
7.89
160.55
169.47
41.58
0.00
667.92
Mar '08
411.95
472.81
74.95
397.86
45.33
2.69
349.84
0.00
349.84
132.62
217.23
667.92
0.00
70.73
12.02
142.21
157.73
44.49
0.00
594.18
Mar '07
344.79
443.63
98.08
345.55
42.69
6.40
296.46
-1.51
294.95
94.50
200.45
594.17
0.00
55.01
9.35
5,715.69
1.13
45.00
41.21
3,929.54
1.46
60.00
30.08
3,929.54
4.34
60.00
30.01
3,929.54
5.53
90.00
27.08
3,929.54
5.10
70.00
23.66
Cash Flow of Oberoi Group Of Hotels

72
(fig in Cr.)
Mar '11
12 mths
(fig in Cr.)
Gh
Mar '11
Mar '10
Mar '09
Mar '08
Mar '07
12 mths
12 mths
12 mths
12 mths
12 mths
87.00
88.99
273.26
349.84
257.16
84.24
54.93
143.69
241.19
182.00
-190.17
-271.39
-264.04
-231.82
-252.31
686.44
188.11
136.05
-33.52
56.41
580.51
-28.35
15.69
-24.15
-13.90
13.77
42.12
26.42
50.57
64.47
594.28
13.77
42.12
26.42
50.57
Mar '11
Mar '10
Mar '09
Mar '08
Mar '07
Face Value
2.00
2.00
2.00
2.00
2.00
Dividend Per Share
0.90
1.20
1.20
1.80
1.40
Operating Profit Per Share (Rs)

Net Operating Profit Per Share
(Rs)
2.94
3.24
5.86
10.48
8.77
16.95
19.70
22.62
27.48
23.90
Free Reserves Per Share (Rs)
37.42
25.47
25.41
22.40
18.81
Bonus in Equity Capital
47.82
69.56
69.56
69.56
69.56
17.35
16.11
25.92
38.14
36.72
7.05
6.25
18.05
31.88
30.35
Net Profit Before Tax

Net Cash From Operating
Activities
Net Cash (used in)/from
Investing Activities
Financing Activities
Net (decrease)/increase In
Cash and Cash
Equivalents
Opening Cash & Cash
Equivalents
Closing Cash & Cash
Equivalents
Key Financial Ratio of Oberoi Group Of Hotels
Investment Valuation Ratios
Profitability Ratios
Operating Profit Margin (%)
Profit Before Interest And Tax
Margin (%)
Gross Profit Margin (%)
8.32
7.32
19.82
33.95
30.44
Cash Profit Margin (%)
14.74
13.80
13.59
23.86
24.43
Adjusted Cash Margin (%)
14.74
8.83
13.59
23.86
20.94
Net Profit Margin (%)
5.64
6.69
17.46
18.89
20.14
Adjusted Net Profit Margin (%)

Return On Capital Employed
( %)
5.64
6.30
17.46
18.89
16.01
8.01
7.09
11.97
23.12
20.44
Return On Net Worth (%)

Adjusted Return on Net Worth
(%)
Return on Assets Excluding
Revaluations
Return on Assets Including
Revaluations
2.73
4.03
14.45
20.44
21.56
3.44
0.63
6.65
21.30
17.29
41.21
30.08
30.01
27.03
23.45
45.28
36.06
36.08
33.17
29.66
8.01
6.07
11.97
24.27
20.56
Current Ratio
2.42
0.89
1.24
0.69
1.04
Quick Ratio
2.31
1.20
1.14
0.88
1.01
Debt Equity Ratio
0.35
0.89
0.86
0.76
0.85
Return on Long Term Funds (%)

Liquidity And Solvency Ratios
73
Gh
Long Term Debt Equity Ratio
0.35
0.89
0.86
0.68
0.84
Interest Cover
1.64
1.88
3.19
5.79
3.59
Total Debt to Owners Fund

Financial Charges Coverage
Ratio
Financial Charges Coverage
Ratio Post Tax
0.35
1.07
0.86
0.76
0.85
2.21
2.06
3.85
6.43
4.09
1.98
2.24
3.72
4.54
3.54
70.33
25.75
--
--
32.80
Debt Coverage Ratios
Management Efficiency Ratios

Inventory Turnover Ratio
Debtors Turnover Ratio
8.58
8.09
8.60
10.02
10.06
Investments Turnover Ratio
70.33
60.24
--
32.47
5,589.10
Fixed Assets Turnover Ratio
0.37
0.31
--
--
0.80
Total Assets Turnover Ratio
0.31
0.29
--
0.58
0.55
Asset Turnover Ratio
0.37
0.31
0.49
0.63
0.63
Average Raw Material Holding
--
--
--
--
--
Average Finished Goods Held

Number of Days In Working
Capital
--
--
--
--
0.09
231.45
58.54
42.22
-1.28
15.75
--
--
--
--
--
--
--
--
--
--
4.62
4.50
5.07
4.42
4.23
49.50
56.95
56.36
55.31
56.05
Dividend Payout Ratio Net Profit

Dividend Payout Ratio Cash
Profit
90.76
95.70
32.29
38.09
32.10
38.54
43.72
24.49
31.19
25.79
Earning Retention Ratio
27.74
-631.24
29.84
63.45
59.61
Cash Earning Retention Ratio
65.24
27.48
58.52
69.84
69.13
4.89
16.68
7.68
2.96
3.80
Mar '11
Mar '10
Mar '09
Mar '08
Mar '07
1.13
1.46
4.34
5.53
5.10
41.21
30.08
30.01
27.08
23.66
Profit & Loss Account Ratios

Material Cost Composition
Imported Composition of Raw
Materials Consumed
Selling Distribution Cost
Composition
Expenses as Composition of
Total Sales
Cash Flow Indicator Ratios
AdjustedCash Flow Times

Earnings Per Share
Book Value
20.2 LEELA HOTELS

Incorporated in 1981 to set up and operate 5-star hotels, Hotel Leela Venture entered into a
74
Gh
Collaboration with Penta Hotels, UK, which was subsequentl transferred to Kempinski hotels,
European chain of 5-star deluxe hotels, owned by Lufthansa, the German airline.
The Company entered into collaboration agreement with Penta Hotels Ltd. (Penta) for a period of
10 years for sales, marketing & technical know-how. Penta also agreed to provide full marketing
support to the hotel including selling of the hotel by the 3 airline partners of Penta viz. Lufthansa,
Swissair & British Airways.
Hotel Leela Venture Ltd. has appointed Mr. V.L. Ganesh as the Chief Financial Officer of the
Company with effect from November 01, 2006.
20.2.1 VISSIONS & MISSIONS OF LEELA GROUP OF HOTEL
THE LEELA VISION
Innovation Excellence Perfection
The three pillars on which The Leela Group has built its reputation are Innovation, Excellence, and
Perfection. They also represent the three faces of modern India. World class technology, great
tradition enriched over the centuries and the obsessive desire to be hospitable to global travellers.
THE LEELA MISSION
To sustain and surpass excellence in service, ambience and performance hall marks that
distinguishes The Leela Group. . The strategic locations, individuality, architectural aesthetics, lush
greens and the intrinsic Indian culture holds true for every Leela property. Reflecting thereby 'The
Essence of India'.
Our focused operating philosophy is personalized service and comprehensive logistic support. We
ensure that our esteemed clients, devote their time to the sole purpose of their stay - to conduct
business and relax in the most conducive environment.
20.2.2 FINANCIALS OF LEELA HOTEL

75
Gh
Balance Sheet of Hotel Leela Ventures
(fig in Cr.)
Mar '11
Mar '10
Mar '09
Mar '08
Mar '07
12 mths
12 mths
12 mths
12 mths
12 mths
Total Share Capital
77.57
75.57
75.56
75.56
74.06
Equity Share Capital
77.57
75.57
75.56
75.56
74.06
Share Application Money
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
812.05
752.38
626.77
642.08
610.85
Revaluation Reserves
1,213.26
1,226.20
1,237.69
212.53
216.28
Networth
2,102.88
2,054.15
1,940.02
930.17
901.19
Secured Loans
3,307.40
2,353.48
1,818.63
1,291.12
591.72
495.74
525.18
630.89
744.54
361.07
Total Debt
3,803.14
2,878.66
2,449.52
2,035.66
952.79
Total Liabilities
5,906.02
4,932.81
4,389.54
2,965.83
1,853.98
Mar '11
Mar '10
Mar '09
Mar '08
Mar '07
12 mths
12 mths
12 mths
12 mths
12 mths
4,622.39
4,145.53
3,833.45
2,604.31
1,795.98
Sources Of Funds
Reserves
Unsecured Loans
Application Of Funds
Gross Block
Less: Accum. Depreciation
519.58
476.86
398.46
336.38
278.77
Net Block
4,102.81
3,668.67
3,434.99
2,267.93
1,517.21
Capital Work in Progress
1,598.33
1,221.19
934.54
405.77
193.60
Investments
46.14
46.19
46.24
0.28
59.92
Inventories
54.38
43.43
41.96
38.67
31.50
Sundry Debtors
49.30
37.90
31.51
38.63
37.10
Cash and Bank Balance
48.29
6.61
20.01
8.34
5.10
Total Current Assets
151.97
87.94
93.48
85.64
73.70
Loans and Advances
434.17
321.24
301.42
222.08
241.55
7.77
6.87
10.38
287.25
5.60
593.91
416.05
405.28
594.97
320.85
0.00
0.00
0.00
0.00
0.00
335.36
290.66
280.74
190.73
223.81
99.81
128.64
150.77
112.38
13.79
Total CL & Provisions
435.17
419.30
431.51
303.11
237.60
Net Current Assets
158.74
-3.25
-26.23
291.86
83.25
0.00
0.00
0.00
0.00
0.00
5,906.02
4,932.80
4,389.54
2,965.84
1,853.98
352.06
231.76
259.79
234.92
78.11
22.94
21.91
18.59
18.99
18.50
Mar '10
Mar '09
Mar '08
Fixed Deposits
Total CA, Loans & Advances
Deferred Credit
Current Liabilities
Provisions
Total Assets
Contingent Liabilities
Book Value (Rs)
Profit & Loss of Hotel Leela Ventures

Mar '11
76
(Fig in Cr.)
Mar '07
Gh
12 mths
12 mths
12 mths
12 mths
12 mths
526.23
430.12
452.23
514.58
380.86
Income
Sales Turnover
Excise Duty
Net Sales
Other Income
Stock Adjustments
0.00
0.00
0.00
0.00
0.00
526.23
430.12
452.23
514.58
380.86
25.30
32.53
119.12
44.82
71.55
0.00
0.00
0.00
0.00
0.00
551.53
462.65
571.35
559.40
452.41
Raw Materials
22.37
21.43
20.23
21.50
17.87
Power & Fuel Cost
44.46
43.95
44.69
41.40
26.97
Employee Cost
Other Manufacturing
Expenses
121.43
100.53
94.77
88.49
57.02
51.34
43.17
39.87
45.14
33.09
Selling and Admin Expenses
103.65
74.73
77.84
68.17
49.11
13.91
11.89
13.24
12.48
6.64
0.00
0.00
0.00
0.00
0.00
Total Income
Expenditure
Preoperative Exp
Capitalised
Total Expenses
357.16
295.70
290.64
277.18
190.70
Mar '11
Mar '10
Mar '09
Mar '08
Mar '07
12 mths
12 mths
12 mths
12 mths
12 mths
Operating Profit
169.07
134.42
161.59
237.40
190.16
PBDIT
194.37
166.95
280.71
282.22
261.71
Interest
PBDT
Depreciation
68.30
34.00
32.34
42.98
38.25
126.07
132.95
248.37
239.24
223.46
68.43
68.33
54.92
45.34
33.75
Other Written Off
0.00
0.00
0.00
0.00
0.00
Profit Before Tax
57.64
64.62
193.45
193.90
189.71
Extra-ordinary items
-1.04
-3.99
-2.82
-1.56
-0.19
PBT (Post Extra-ord Items)
56.60
60.63
190.63
192.34
189.52
Tax
18.75
19.63
45.65
73.18
63.27
Reported Net Profit
38.88
41.02
144.98
150.12
126.43
Total Value Addition
334.80
274.27
270.40
255.67
172.83
Preference Dividend
0.00
0.00
0.00
0.00
0.00
Equity Dividend
5.82
7.56
15.11
18.89
16.66
Corporate Dividend Tax
0.94
1.26
2.57
3.21
2.50
3,878.25
3,778.25
3,778.25
3,778.25
3,703.03
Per share data (annualised)

Shares in issue (lakhs)
Earning Per Share (Rs)
1.00
1.09
3.84
3.97
3.41
Equity Dividend (%)
7.50
10.00
20.00
25.00
22.50
22.94
21.91
18.59
18.99
18.50
Book Value (Rs)
Cash Flow of Hotel Leela Ventures

Mar '11
12 mths
77
(fig in Cr.)
Mar '10
12 mths
Mar '09
12 mths
Mar '08
12 mths
Mar '07
12 mths
Gh
Net Profit Before Tax
Net Cash From Operating
Activities
Investing Activities
Financing Activities
Net (decrease)/increase In
Cash and Cash
Equivalents
Opening Cash & Cash
Equivalents
Closing Cash & Cash
Equivalents
57.62
64.64
193.45
223.30
189.70
68.80
88.93
267.93
117.70
216.78
-845.07
-601.97
-596.98
-910.44
-124.49
818.84
495.09
63.85
1077.56
-244.28
42.57
-17.95
-265.19
284.81
-151.99
13.48
31.43
295.58
10.77
162.69
56.05
13.48
30.39
295.58
10.70
Key Financials of Hotel Leela Ventures

Investment Valuation Ratios
Face Value
Dividend Per Share
Operating Profit Per Share (Rs)
Net Operating Profit Per Share (Rs)
Free Reserves Per Share (Rs)
Bonus in Equity Capital
Profitability Ratios
Operating Profit Margin (%)
Profit Before Interest And Tax
Margin (%)
Gross Profit Margin (%)
Cash Profit Margin (%)
Adjusted Cash Margin (%)
Net Profit Margin (%)
Adjusted Net Profit Margin (%)
Return On Capital Employed (%)
Return On Net Worth (%)
Adjusted Return on Net Worth (%)
Return on Assets Excluding
Revaluations
Return on Assets Including
Revaluations
Return on Long Term Funds (%)
Liquidity And Solvency Ratios
Current Ratio
Quick Ratio
Debt Equity Ratio
Long Term Debt Equity Ratio
Debt Coverage Ratios
Interest Cover
78
Mar'11
Mar '10
Mar '09
Mar '08
Mar '07
2.00
0.15
4.36
13.57
17.11
--
2.00
0.20
3.56
11.38
16.46
--
2.00
0.40
4.28
11.97
13.29
--
2.00
0.50
6.28
13.62
14.49
--
2.00
0.45
5.14
10.29
14.13
--
32.12
31.25
35.73
46.13
49.92
18.20
19.12
19.64
19.64
7.03
7.03
2.71
4.37
4.51
14.29
15.36
24.44
24.44
8.87
8.87
2.65
4.95
5.39
18.60
23.58
35.71
35.71
25.28
25.28
7.23
20.64
21.34
32.82
37.32
32.76
32.76
25.65
25.65
9.53
20.91
20.39
38.88
41.06
27.34
27.34
31.43
31.43
10.85
18.45
11.12
22.94
21.91
18.59
18.99
18.50
54.22
2.91
54.37
2.74
51.35
7.34
24.62
9.66
24.34
11.07
0.75
1.21
4.28
3.90
0.72
0.86
3.48
3.32
0.80
0.82
3.49
3.42
1.70
1.82
2.84
2.79
1.10
1.02
1.39
1.34
2.21
4.02
8.53
7.38
5.89
Gh
Total Debt to Owners Fund
Financial Charges Coverage Ratio
Financial Charges Coverage Ratio
Post Tax
Management Efficiency Ratios
Inventory Turnover Ratio
Debtors Turnover Ratio
Investments Turnover Ratio
Fixed Assets Turnover Ratio
Total Assets Turnover Ratio
Asset Turnover Ratio
Average Raw Material Holding
Average Finished Goods Held
Number of Days In Working Capital
Profit & Loss Account Ratios
Material Cost Composition
Imported Composition of Raw
Materials Consumed
Selling Distribution Cost
Composition
Expenses as Composition of Total
Sales
Cash Flow Indicator Ratios
Dividend Payout Ratio Net Profit
Dividend Payout Ratio Cash Profit
Earning Retention Ratio
Cash Earning Retention Ratio
AdjustedCash Flow Times
Earnings Per Share
Book Value
4.28
2.86
3.48
4.90
3.49
8.74
2.84
7.16
1.39
5.53
2.57
4.22
7.18
5.55
5.19
47.63
12.07
47.63
0.11
0.11
0.11
--108.59
62.76
12.39
62.76
0.10
0.12
0.10
---2.72
59.78
12.90
59.78
0.12
0.14
0.12
---20.88
76.78
13.59
76.78
0.20
0.19
0.20
--204.18
74.47
12.36
74.47
0.21
0.23
0.21
--78.70
4.25
4.98
4.47
4.17
4.69
23.40
17.75
--
--
--
7.69
3.91
3.36
2.30
2.43
33.04
39.81
61.18
63.01
67.58
17.39
6.30
83.18
93.78
35.01
Mar '11
1.00
22.94
21.48
8.05
80.29
92.21
25.47
Mar '10
1.09
21.91
12.19
8.84
88.21
91.37
11.96
Mar '09
3.84
18.59
14.72
11.30
84.91
88.48
10.62
Mar '08
3.97
18.99
15.15
11.96
74.86
82.58
8.66
Mar '07
3.41
18.50
20.3 TARRIF RATES OF DIFFERENT HOTELS IN GURGAON

Room Type
No. Of Rooms
Deluxe
Luxury
Premier Room
Deluxe Suite
Premier Suite
Presidential Suite
79
Oberoi
Hotel
202
30000.00
34000.00
38000.00
70000.00
150000.00
300000.00
Hyatt
508
15350.00
15350.00
18750.00
18750.00
26250.00
27250.00
Trident
Hotel
136
19000.00
23000.00
26000.00
30000.00
48000.00
--
Bristol
Hotel
84
9999.00
--12999.00
25999.00
--
The Leela
322
22500.00
24500.00
55000.00
80000.00
200000.00
Proposed
Hotel
370
19500.00
------
Gh
20.4 PROXIMITY COMPARISION WITH PROPOSED HOTEL
Locations
International
Airport
New Delhi
Railway Station
From Nearest
Metro Station
Oberoi
Hotel
Hyatt
Trident
Hotel
Bristol
Hotel
The Leela
Proposed
Hotel
12 kms
17 Kms
16 kms
23 kms
13 kms
25 kms
22 Kms
16 Kms
32 Kms
33 Kms
26 Kms
28 Kms
10Kms
8 Kms
17 Kms
8 kms
17 kms
3 kms
20.5 COMPARISON OF SERVICES RENDERED IN HOTELS IN GURGAON

Oberoi
Hotel
Hyatt
Trident
Hotel
Bristol
Hotel
Gym
Spa
NA
NA
Baby Sitting Services
Meeting & Board Rooms
NA
Proposed
Hotel
Fitness center
80
The
Leela
Gh
Lounge with Nightly Live
Music
Baby Play Area
NA
NA
NA
NA
NA
NA
NA
Internet Access
Tennis Court
Shopping Complex
Pool Bar
Banqueting Facilities
NA
NA
NA
NA
NA
NA
NA
Swimmimg Pools
NA
NA
NA
Visit to Taj Facility
NA
NA
NA
NA
Welcome ammenities
NA
NA
NA
NA
NA
City Sight Seeing Tours
NA
NA
NA
NA
Laundry Services
Business Centres & services
NA
Parking Services
NA
Wheel Chair Facility
NA
Doctors on Call`
Currency Exchange Facility

Wedding Floor Space &
Events
Indian Restaurants
NA
NA
Coffe shops
Computer/ Laptop on hire
Airline Reservation Services
Beuty salon Services
Secretarial services
81
Gh
CHAPTER 21
21.1 BRIEF OF JV AGREEMENT

(fig in lakhs)
Actual Value of Land
Amt already paid
Amount yet to be paid
6000.00
400.00
5600.00
Total Realisable Value to US develpoer

Cost of One Room
No of rooms
Area of One Room
Stage 1: Construction will start when 70% of
total rooms are sell out
Less: Value paid to Land Owner is 60%of vale in
JV agreement
Net accumulated cash at First Stage
Sell of next 30% of Rooms
Less: Value paid to Land owner is 40% of value of
Land in JV agreement
Net accumulated cash at Second Stage
Total Accumulated Cash to Developer
Cost of Contruction of One Room
Cost of Furniture & Interiors
Total Cost of Construction
Cash Accumulation
Fig in Lakhs
146.50
370.00
402.00
Sq. ft
259
i.e 60% of
300Cr
37943.50
18000.00
19943.50
16261.50
111
i.e 40% of
300 Cr
12000.00
4261.50
24205.00
40.20
64.32
38672.40
-14467.40
10000/sq ft
16000/Sq ft
Extra Benefits:
Gold Card may be issued at 50% discount
Gift of mercidies Car worth Rs.50Lacs
21.2 INCOME GENERATION SHEET:
HOTEL CAPACITY
Year 1
Year 2
2015-16
2016-17
Year 3
201718
Year 4
201819
Year 5
201920
Year 6
202021
Year7
2021-22
Year 8
202223
In terms Of Rooms
370
370
370
370
370
370
370
370
Rooms Ready to Use
370
370
370
370
370
370
370
370
82
Ye
20
2
Gh
Occupancy
Occupied No Of Rooms in a
day
Per Day per Room (Rs.)
Per day Revenue Generation
(Rs.)
Per Month Revenue
Generation (Rs.)
Per Year Revenue
Generation from Rooms
(Rs.)
40%
40%
40%
40%
40%
40%
40%
40%
148
148
148
148
148
148
148
148
0.195
0.234
0.281
0.337
0.404
0.485
0.582
0.699
28.860
34.632
59.844
1795.32
3
71.813
2154.38
7
2585.265
103.411
3102.31
8
124
372
1038.960
49.870
1496.10
2
86.175
865.800
41.558
1246.75
2
12467.52
14961.0
2
17953.2
3
21543.8
7
25852.6
5
31023.18
37227.8
2
446
10389.60
Year 1
Year 2
2015-16
2016-17
Year 3
201718
14961.
02
1645.7
13
1496.1
02
748.05
12
598.44
1
2244.1
54
448.83
07
598.44
1
448.83
07
6732.4
61
2019.7
Year 4
201819
17953.2
3
1974.85
5
1795.32
3
897.661
4
718.129
2
2692.98
4
538.596
9
718.129
2
538.596
9
8078.9
53
2423.68
Year 5
201920
21543.
87
2369.8
26
2154.3
87
1077.1
94
861.75
5
3231.5
81
646.31
62
861.75
5
646.31
62
9694.7
44
2908.4
Year 6
202021
25852.6
5
2843.79
1
2585.26
5
1292.63
2
1034.10
6
3877.89
7
775.579
5
1034.10
6
775.579
5
11633.
69
3490.10
Year 8
202223
37227.
82
4095.0
6
3722.7
82
1861.3
91
1489.1
13
5584.1
72
1116.8
34
1489.1
13
1116.8
34
16752.
52
5025.7
Ye
20
2
446
21.3 EXPENSE SHEET :
Net Services Provided
10389.6
12467.52
1142.856
1371.427
1038.96
1246.752
519.48
623.376
Reserves for Maintainence
415.584
498.7008
Repais & Maintainance
1558.44
1870.128
Insurance Exp
311.688
374.0256
Elecricity Exp
415.584
498.7008
License & Taxes
311.688
374.0256
5610.38
4
1683.115
Franchisee Fees
Managemnt & Staff Salaries
Daily Consumables
Profit Before Tax

Less: Tax @ 30%
83
4675.32
1402.596
Year7
2021-22
31023.18
3412.55
3102.318
1551.159
1240.927
4653.477
930.6954
1240.927
930.6954
13960.4
3
4188.129
491
446
223
178
670
134
178
134
20
603
Gh
3272.724
3927.26
9
Net Profit to Land Owner
1669.089
2002.907
Net Profit to Developer
1603.635
1924.362
Profit After Tax
84
38
4712.7
23
2403.4
89
2309.2
34
6
5655.2
67
2884.18
6
2771.08
1
23
6786.3
2
3461.0
23
3325.2
97
8
8143.5
85
4153.22
8
3990.35
6
9772.30
2
4983.874
4788.428
55
11726.
76
5980.6
49
5746.1
13
14
717
689
Gh
21.4 CASH FLOW
201213
FINANCIAL YEAR ENDED
201314
Year 1
201415
Year 2
201516
Year 3
201617
Year 4
201718
10389.6
0
12467.
52
0.00
Year 5
2018-19
Year 6
201920
Year7
202021
14961.0
2
17953.2
3
21543.8
7
25852.6
5
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
10389.
60
0.00
12467.
52
0.00
14961.0
2
0.00
17953.2
3
0.00
21543.
87
0.00
25852.
65
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
1246.7
5
1371.4
3
0.00
0.00
0.00
0.00
1496.10
1795.32
2154.39
2585.26
1645.71
1974.86
2369.83
2843.79
RECEIPT
NET INCOME from summary
SALES PROCEEDS
0.00
37943.
50
0.00
0.00
0.00
0.00
37943
.50
0.00
PROMOTER CONTRIBUTION
UNSECURED LOAN
GROSS RECEIPT
0.00
0.00
16261.5
0
15000.0
0
0.00
0.00
31261.
50
12000.0
0
19336.2
0
EXPENDITURE
18000.
00
LAND
CONSTRUCTION COST
0.00
0.00
19336.2
0
STAFF SALARIES
0.00
0.00
0.00
1038.96
FRANCHISE FEES
CONSUMABLES ( soaps, shampoo,
etc)
0.00
0.00
0.00
1142.86
0.00
0.00
0.00
519.48
REPAIRS & MAINTANANCE
0.00
0.00
0.00
INSURANCE EXP
0.00
0.00
ELECTRICITY EXPENSES
0.00
LICENSE & TAXES

REPAYMENT OF LOAN - PRINCIPAL
REPAYMENT OF LOAN - INTEREST
TOTAL EXPENDITURE
NET CASH GENERATION
ACCUMULATED CASH
GENERATION
748.05
897.66
1077.19
1292.63
1974.02
623.38
2368.8
3
2842.59
3411.11
4093.34
4912.00
0.00
311.69
374.03
448.83
538.60
646.32
775.58
0.00
0.00
415.58
498.70
598.44
718.13
861.75
1034.11
0.00
0.00
0.00
311.69
374.03
448.83
538.60
646.32
775.58
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
18000
.00
0.00
19336.
20
19336.
20
0.00
31336.
20
0.00
5714.2
8
0.00
6857.1
4
0.00
0.00
8228.56
9874.28
0.00
11849.
13
0.00
14218.
96
607.30
532.60
4675.3
2
5207.9
2
5610.3
8
10818.
30
6732.46
17550.7
6
8078.95
25629.7
2
9694.7
4
35324.
46
11633.
69
46958.
15
19943
.50
-74.70
21.5 PROFITABILITY PROJECTION

Projecti
on
2012-13
Project
ion
201314
Project
ion
201415
Project
ion
201516
Project
ion
201617
Project
ion
201718
Project
ion
201819
Project
ion
201920
Project
ion
202021
0.00
0.00
0.00
10389.6
0
12467.5
2
14961.0
2
17953.2
3
21543.8
7
25852.6
5
Production during the year

(Quantity)
% Utilization of installed
capacity
Sales
1. Gross Income from
Summary
85
Gh
2. Sales Proceeds
37943.50
0.00
3. Total Sales
37943.5
0
0.00
0.00
18000.00
19336.2
0
0.00
0.00
16261.5
0
16261.
50
0.00
0.00
0.00
0.00
0.00
0.00
10389.
60
12467.
52
14961.
02
17953.
23
21543.
87
25852.
65
0.00
0.00
0.00
0.00
0.00
0.00
Cost of Production
1. Construction Cost
0.00
0.00
0.00
0.00
0.00
0.00
0.00
19336.2
0
12000.0
0
0.00
1142.86
1371.43
1645.71
1974.86
2369.83
2843.79
0.00
0.00
0.00
415.58
498.70
598.44
718.13
861.75
1034.11
0.00
0.00
0.00
0.00
0.00
0.00
1038.96
519.48
1246.75
623.38
1496.10
748.05
1795.32
897.66
2154.39
1077.19
2585.26
1292.63
0.00
0.00
0.00
0.00
0.00
0.00
1974.02
623.38
2368.83
748.05
2842.59
897.66
3411.11
1077.19
4093.34
1292.63
4912.00
1551.16
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
18000.0
0
0.00
19336.
20
0.00
31336.
20
0.00
5714.2
8
0.00
6857.1
4
0.00
8228.5
6
0.00
9874.2
8
0.00
11849.
13
0.00
14218.
96
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
18000.0
0
19943.5
0
19336.
20
19336.
20
31336.
20
15074.
70
5714.2
8
4675.3
2
6857.1
4
5610.3
8
8228.5
6
6732.4
6
9874.2
8
8078.9
5
11849.
13
9694.7
4
14218.
96
11633.
69
1. Term Loans
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
2. Working Capital
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
3. Other Loans if any
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
Selling, General &

Administrative Expenses
Profit before Taxation {E(F+G)}
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
19943.50
19336.2
0
0.00
15074.7
0
0.00
4675.32
5610.38
6732.46
8078.95
9694.74
11633.6
9
0.00
0.00
0.00
0.00
0.00
0.00
19336.2
0
0.00
15074.7
0
0.00
4675.32
5610.38
6732.46
8078.95
9694.74
11633.6
9
0.00
0.00
0.00
0.00
0.00
0.00
15074.7
0
0.00
4675.32
5610.38
6732.46
8078.95
9694.74
11633.6
9
0.00
19336.2
0
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
2. Land Cost
2.Franchisse Fees
3.Power & Fuel
4.Direct labour & wages
5.Consumable Stores
6.Repairs & Maintenance
7.Other expenses
8.Depreciation/
Development Rebate
Reserve
Total Cost of Production
9.Add opening stock-inprocess & finished goods
10.Deduct closing stock-inprocess & finished goods
Cost of Sales
Gross Profit (B-D)
Interest on
Provision for Taxes

Net Profit (H-I)
Depreciation added back
Net Cash Accruals
Repayment obligations
1. Towards Existing Term Loan
2. Towards Proposed Term
Loan.
Total Repayment
Debt Service ratio (L:M)
86
0.00
19943.50
0.00
19943.50
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
Gh
21.6 Projected Balance Sheet:
Projectio Projectio Projecti Projectio Projectio Projectio Projecti Projecti Projectio P

n
n
on
n
n
n
on
on
n
2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21
A Liabilities
1. Equity Share Capital
2.Reserve & Surplus
0.00
19943.50
1
0.00 15000.00 15000.00 15000.00 15000.00 15000.00 15000.00 15000.00
4
607.30 14467.40 -9792.08 -4181.70 2550.76 10629.72 20324.46 31958.15
3. Term loans
4.Bank Borrowings for Working
Capital
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
5. Unsecured Loan
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
6. Sundry Creditors
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
7. Other liabilities (Installment

Due within Next One Year)
0.00
0.00
0.00
0.00
0.00
0.00
19943.50
607.30
0.00
0.00
0.00
0.00
0.00
0.00
Total Liabilities
B
0.00
0.00
0.00
25629.7 35324.4
532.60 5207.92 10818.30 17550.76
2
6 46958.15
Assets
1. Gross Block
0.00
0.00
0.00
2.Depreciation
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
3. Net Block
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
4.Investment
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
5. Inventory
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
6. Sundry Debtors
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
7. Other Current Assets
0.00
0.00
0.00
532.60
8. Working Capital Margin
0.00
0.00
0.00
0.00
0.00
19943.50
607.30
532.60
4675.32
5610.38
19943.50
607.30
4
5207.92 10818.30 17550.76 25629.72 35324.46
0.00
0.00
0.00
0.00
1
9. Cash & Bank Balances
Total Assets
87
6732.46 8078.95 9694.74 11633.69

25629.7 35324.4
532.60 5207.92 10818.30 17550.76
2
6 46958.15
Gh
21.7 CMA OPERATING STATEMENT :
(Amo
Year 2
Project
ion
201516
Year 3
Project
ion
201617
Year 4
Project
ion
201718
Year 5
Project
ion
201819
Year 6
Project
ion
201920
Year7
Project
ion
202021
10389.6
0
10389.6
0
12467.5
2
12467.5
2
14961.0
2
14961.0
2
17953.2
3
17953.2
3
21543.8
7
21543.8
7
25852.6
5
25852.6
5
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
16261.5
0
0.00
10389.6
0
0.00
12467.5
2
0.00
14961.0
2
0.00
17953.2
3
0.00
21543.8
7
0.00
25852.6
5
-100%
#DIV/0!
-36%
20%
20%
20%
20%
20%
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
b) Indigeneous
ii) Construction & Land
Cost
0.00
18000.0
0
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
18000.0
0
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
31336.2
0
19336.2
0
12000.0
0
0.00
a) Construction Cost
0.00
19336.2
0
19336.2
0
0.00
0.00
0.00
0.00
0.00
0.00
Sr.
N
o.
Particulars
Project
ion
201213
Gross Sales
37943.5
0
I) Gross Income
ii) Sales Proceeds
2
Less : Excise Duty
Net Sales
%age rise(+) or fall (-) in
net sales
4
5
Cost of Sales
I)Raw Material (incl.
stores and other items
used in process of mfg.)
Project
ion
201314
Year 1
Project
ion
201415
0.00
16261.5
0
0.00
37943.5
0
0.00
0.00
37943.5
0
0.00
0.00
0.00
16261.5
0
a) Imported
b) Land Cost
iii) Power & Fuel
iv) Direct labour (factory
wages & labour)
0.00
0.00
0.00
415.58
498.70
598.44
718.13
861.75
1034.11
0.00
0.00
0.00
2181.82
2618.18
3141.82
3770.18
4524.21
5429.06
v) Other expenses
vi) Depreciation (on
assets for mfg.)
0.00
0.00
0.00
2493.50
2992.20
3590.65
4308.77
5170.53
6204.64
0.00
18000.0
0
0.00
19336.2
0
0.00
31336.2
0
0.00
0.00
0.00
0.00
5090.90
6109.08
7330.90
8797.08
0.00
10556.5
0
0.00
12667.8
0
0.00
18000.0
0
0.00
19336.2
0
0.00
31336.2
0
0.00
0.00
0.00
0.00
5090.90
6109.08
7330.90
8797.08
0.00
10556.5
0
0.00
12667.8
0
0.00
18000.0
0
0.00
19336.2
0
0.00
31336.2
0
0.00
0.00
0.00
0.00
5090.90
6109.08
7330.90
8797.08
0.00
10556.5
0
0.00
12667.8
0
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
18000.0
0
0.00
19336.2
0
0.00
31336.2
0
0.00
0.00
0.00
0.00
5090.90
6109.08
7330.90
8797.08
0.00
10556.5
0
0.00
12667.8
0
0.00
18000.0
0
0.00
19336.2
0
0.00
31336.2
0
0.00
0.00
0.00
0.00
5090.90
6109.08
7330.90
8797.08
0.00
10556.5
0
0.00
12667.8
0
vii) SUB-TOTAL
viii) Add : Opening stockin-process
Sub-Total
ix) Deduct : Closing stockin-process
x) Cost of Production
xi) Add : Opening stock of
finished goods
Add: Purchase of
finished goods
Sub-Total
xii) Deduct : Closing stock
of finished goods
xiii) SUB TOTAL (Total
cost of sales)
88
Gh
6
Selling, general and

admns. Expenses (incl.
depr. of assets which are
not used for mfg.)
SUB TOTAL
0.00
18000.0
0
Operating profit before

interest
19943.5
0
Interest
10
11
Operating profit after

interest
I) Add : Other nonoperating income
0.00
19336.2
0
19336.2
0
0.00
31336.2
0
15074.7
0
9874.28
1292.63
11849.1
3
1551.16
14218.9
6
6732.46
8078.95
9694.74
11633.6
9
19943.5
0
0.00
19336.2
0
0.00
15074.7
0
0.00
0.00
0.00
0.00
0.00
4675.32
5610.38
6732.46
8078.95
9694.74
11633.6
9
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
19336.2
0
0.00
15074.7
0
0.00
0.00
0.00
0.00
0.00
0.00
4675.32
5610.38
6732.46
8078.95
9694.74
11633.6
9
0.00
15074.7
0
0.00
0.00
0.00
0.00
0.00
0.00
19943.5
0
0.00
19336.2
0
4675.32
5610.38
6732.46
8078.95
9694.74
11633.6
9
19943.5
0
19336.2
0
15074.7
0
4675.32
5610.38
6732.46
8078.95
9694.74
11633.6
9
100%
100%
100%
100%
100%
100%
100%
100%
100%
0.00
623.38
748.05
897.66
1077.19
5714.28
6857.14
8228.56
4675.32
5610.38
0.00
a) Duty draw-back etc.

b) Others
Sub Total (income)
ii) Deduct other nonoperating expenses
a) Transfer to export
business reserve
b) Others
Sub-Total (expenses)
iii) Net of other nonoperating
income/expenses (net of
11(I) & (ii))
12
Profit before tax / loss
13
Provision for taxation
14
Net profit / loss
15
a) equity dividend
19943.5
0
0.00
b) Dividend rate
16
17
Retained profit
Retained profit / Net profit
(%)
89
Gh
21.8 CMA - ANALYSIS OF BALANCE SHEET : ( LIABILITIES SIDE )

Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year
2012-13
Project
ion
201314
Project
ion
201415
Project
ion
201516
Projec
tion
201617
Project
ion
201718
Projec
tion
201819
Project
ion
201920
Projec
io
2020
2
ii) From other banks
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
iii) (of which BP and BD)

TOTAL BANK
BORROWINGS
Short-term borrowing from
others
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
Sundry creditors (Trade)

Advance payment from
customers
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
Provision for taxation
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
Dividend payable
Other statutory liabilities
(due within one yr)
Deposits / instalments of
term loans / DPG /
debentures (due within one
year)
Other current liabilities and
provisions due within one
year
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
0.00
0.00
0.00
0.00
0.00
0.00
425.58
311.82
602.4
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
Sr.
No
.
Particulars
Projecti
on
CURRENT LIABILITIES
Short-term borrowing from
banks (incl. bill purchased /
discounted & excess
borrowing placed on
repayment basis
I) From applicant bank
2
3
8
9
I) Inter-corporate deposits
10
11
ii)Others
OTHER CURRENT
LIABILITIES
TOTAL CURRENT
LIABILITIES
Debentures (not maturing
within one year)
90
Gh
12
13
Redeemable preference
share (redeemaable after
one year)
Term Loans (excl.
installments payable within
1 yr.)
Deferred Payment Credits
(excl. installments due
within 1 year)
Term Deposits (repayable
after 1 year)
Other term liabilities Unsecured Loans
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
0.00
0.00
15000.0
0
15000.0
0
15000.
00
15000.0
0
15000.
00
15000.0
0
15000.
Partners' capital
(maturing after 12 yrs.)
0.00
0.00
0.00
0.00
0.00
0.0
607.30
9792.08
2550.76
10629.
72
20324.4
6
31958.
19943.50
0.00
4181.7
0
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
22
A) General reserve
B) Development rebate
reserve / Investment
allowance reserve
Other reserve (excluding
provisions)
0.00
14467.4
0
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.0
23
Surplus / deficit in P&L a/c
0.00
0.00
0.00
0.00
NET WORTH
TOTAL LIABILITIES
(18+24)
19943.50
607.30
532.60
5207.92
19943.50
607.30
532.60
5207.92
0.00
17550.7
6
17550.7
6
0.00
25629.
72
25629.
72
0.00
35324.4
6
35324.4
6
0.0
46958.
24
0.00
10818.
30
10818.
30
14
15
16
17
18
TOTAL TERM LIABILITIES

TOTAL OUTSIDE
LIABILITIES (10+17)
NET WORTH
19
20
21
25
46958.
21.9 CMA - ANALYSIS OF BALANCE SHEET : ( ASSET SIDE) :

Sr.
No
.
Particulars
Projec
tion
201213
Project
ion
201314
Year 1
Projec
tion
201415
Year 2
Project
ion
201516
Year 3
Projec
tion
201617
Year 4
Project
ion
201718
Year 5
Projec
tion
201819
Year 6
Project
ion
201920
Year 7
Project
ion
202021
19943.
50
607.30
532.60
4675.32
5610.3
8
6732.46
8078.9
5
9694.74
11633.6
9
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
CURRENT ASSETS
26
27
28
Cash & Bank Balances

Investments (other than
long term)
i) Govt. & other trustee
securities
ii) Fixed Deposits with banks
I) Receivables other than
deferred & exposrts (incl.
bill purchase / disc.)
91
Gh
ii) Export receivables
(incl.bills purchsed &
discounted
Installment of deferred
receivables
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
Inventory
I) Raw materials (incl. stores
& other items used in the
process of manufacturing
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
a) Imported
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
b) Indigenous
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
ii) Stock-in-process
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
iii) Finished Goods

iv) Other consumables
stores & spares
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
31
Advance to suppliers
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
32
Advance payment of taxes
0.00
0.00
0.00
0.00
33
Other current assets
0.00
0.00
532.60
34
TOTAL CURRENT ASSETS
0.00
19943.
50
607.30
532.60
5207.92
0.00
5207.9
2
10818.
30
0.00
10818.3
0
17550.7
6
0.00
17550.
76
25629.
72
0.00
25629.7
2
35324.4
6
0.00
35324.4
6
46958.1
5
35
FIXED ASSETS
Gross block (land &
building,machinery, workin-progress
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
36
Depreciation to date
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
37
Net Block
OTHER NON CURRENT
ASSETS
Investments / book-debts /
advance deposits which are
non-current assets
i) a) Investments in
subsidiaries/ affiliate
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
42
b) Others
ii) Advance to suppliers of
capital goods
iii) Deferred receivables
(maturing after 1 year)
Other non consuamable
stores & spares
Other non-current assets
(int. suspense)
TOTAL NON-CURRENT
ASSETS
Intangible assets (Goodwill
patents, Pre-expenses, bad
& doubtful debts)
0.00
0.00
0.00
43
TOTAL ASSETS
607.30
532.60
5207.92
44
TANGIBLE NET WORTH
607.30
532.60
5207.92
45
NET WORKING CAPITAL
607.30
5207.92
0.00
46958.1
5
46958.1
5
46958.1
5
#DIV/0!
#DIV/0!
#DIV/0!
0.00
25629.
72
25629.
72
25629.
72
#DIV/0
!
0.00
35324.4
6
35324.4
6
35324.4
6
CURRENT RATIO
532.60
#DIV/0
!
0.00
10818.
30
10818.
30
10818.
30
#DIV/0
!
0.00
17550.7
6
17550.7
6
17550.7
6
46
0.00
19943.
50
19943.
50
19943.
50
#DIV/0
!
#DIV/0!
#DIV/0!
51
TOTAL OUTSIDE
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
29
30
38
39
40
41
92
Gh
LIABILITIES/TNW
21.10 COMPARATIVE STATEMENT OF CA & CL
Sr.
No
.
1
2
3
4
5
6
7
8
WORKING
CAPITAL
ASSESSMENT
Total Current
Assets
Other CL (other
than bank
borrowing)
WCG
Minimum
stipulated NWC
(25% of WCG /
25% of total CA
as the case may
be)
Actual /
projected NWC
Item 3 minus
Item 4
Item 3 minus
Item 5
MPBF (Item 6 or
7 whichever is
lower)
Excess borrowing
representing
shortfall in NWC
(4-5)
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year7
Yea
Project
ion
201516
607.30
532.60
5207.92
Project
ion
201617
10818.3
0
Project
ion
201718
17550.7
6
Project
ion
201819
25629.7
2
Project
ion
201920
35324.4
6
Project
ion
202021
46958.1
5
Proj
2013-14
Project
ion
201415
0.00
0.00
0.00
532.60
5207.92
0.00
17550.7
6
0.00
25629.7
2
0.00
35324.4
6
0.00
46958.1
5
0
6091
607.30
0.00
10818.3
0
151.83
133.15
1301.98
607.30
532.60
5207.92
2704.58
10818.3
0
455.48
399.45
3905.94
8113.73
4387.69
17550.7
6
13163.0
7
6407.43
25629.7
2
19222.2
9
8831.12
35324.4
6
26493.3
5
11739.5
4
46958.1
5
35218.6
2
1522
4985.88
19943.5
0
14957.6
3
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
8113.73
13163.0
7
19222.2
9
26493.3
5
35218.6
2
4568
-399.45
3905.94
Project
ion
201213
19943.5
0
Projecti
on
0.00
19943.5
0
14957.6
3
-455.48
202
6091
6091
4568
21.11 TURNOVER METHOD
Sr.
No
.
1
WORKING CAPITAL
ASSESSMENT
Gross Sales
93
Projec
tion
201213
37943.
50
Project
ion
201314
0.00
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year7
Year
Projec
tion
201415
16261.
50
Project
ion
201516
10389.6
0
Projec
tion
201617
12467.
52
Project
ion
201718
14961.0
2
Projec
tion
201819
17953.
23
Project
ion
201920
21543.8
7
Projec
tion
202021
25852.
65
Projec
io
2021
2
31023.
Gh
2
25% of gross sales
3
4
5% of gross sales
Actual / projected
NWC
Item 2 minus Item 3
Item 2 minus Item 4

Permissible bank
finance(Item 5 or
6,whichever is lower)
9485.8
8
1897.1
8
19943.
50
7588.7
0
10457.
63
10457.
63
0.00
4065.3
8
2597.40
0.00
813.08
519.48
607.30
5207.92
0.00
532.60
3252.3
0
-607.30
3532.7
8
2610.52
-607.30
3252.3
0
2610.52
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year7
Ye
Project
ion
201516
15000.0
0
15000.0
0
Project
ion
201617
15000.0
0
15000.0
0
Project
ion
201718
15000.0
0
15000.0
0
Project
ion
201819
15000.0
0
15000.0
0
Project
ion
201920
15000.0
0
15000.0
0
Project
ion
202021
15000.0
0
15000.0
0
Pro
2077.92
3116.8
8
623.38
10818.
30
2493.5
0
7701.4
2
7701.4
2
3740.26
748.05
17550.7
6
2992.20
13810.5
1
13810.5
1
4488.3
1
897.66
25629.
72
3590.6
5
21141.
41
21141.
41
5385.97
1077.19
35324.4
6
4308.77
29938.4
9
29938.4
9
6463.1
6
1292.6
3
46958.
15
5170.5
3
40494.
99
40494.
99
7755.7
1551.1
60918.
6204.6
53162.
53162.
21.12 CMA - FINANCIAL POSITION

(Amoun in Lacs)
Project
ion
201213
Project
ion
201314
Paid up Capital :
0.00
0.00
- Equity
0.00
0.00
Project
ion
201415
15000.0
0
15000.0
0
- Preference Share
Tangible Net worth
(Excl. rev. reserve &
net of intangible
assets)
Investment in cos.
(of which associated
companies/
subsidiaries)
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
19943.5
0
607.30
532.60
5207.92
10818.3
0
17550.7
6
25629.7
2
35324.4
6
46958.1
5
0.00
17550.7
6
0.00
25629.7
2
0.00
35324.4
6
0.00
46958.1
5
a)
b)
c)
0.00
0.00
0.00
Adjusted TNW
0.00
19943.5
0
607.30
532.60
5207.92
0.00
10818.3
0
Quasi Capital
Capital
Employed*(total
funds employed)
19943.5
0
607.30
532.60
5207.92
10818.3
0
17550.7
6
25629.7
2
35324.4
6
46958.1
5
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
d)
e)
f)
g)
Net Block
94
20
150
150
609
609
609
Gh
h)
Net sales :
Domestic
Exports
Total
0.00
37943.5
0
37943.5
0
0.00
0.00
0.00
16261.5
0
16261.5
0
0.00
10389.6
0
12467.5
2
14961.0
2
17953.2
3
21543.8
7
25852.6
5
0.00
10389.6
0
0.00
12467.5
2
0.00
14961.0
2
0.00
17953.2
3
0.00
21543.8
7
0.00
25852.6
5
310
310
i)
Other Income
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
j)
Depreciation
0.00
0.00
19336.2
0
19336.2
0
19336.2
0
3183.96
%
0.00
15074.7
0
15074.7
0
15074.7
0
2830.40
%
0.00
0.00
0.00
0.00
0.00
0.00
5610.38
6732.46
8078.95
9694.74
11633.6
9
139
4675.32
5610.38
6732.46
8078.95
9694.74
11633.6
9
139
4675.32
5610.38
6732.46
8078.95
9694.74
11633.6
9
139
4675.32
89.77%
532.60
5207.92
38.36%
17550.7
6
31.52%
25629.7
2
27.44%
35324.4
6
24.77%
46958.1
5
22.
609
607.30
51.86%
10818.3
0
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
52.56%
#DIV/0!
-92.70%
45.00%
45.00%
45.00%
45.00%
45.00%
45.00%
45.
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DI
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DI
0.00%
#DIV/0!
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
k)
Gross Profit/Loss
19943.5
0
Net profit/loss
19943.5
0
Cash Accruals (l+k)
19943.5
0
l)
m
)
n)
Net profit / Capital
Employed (%)
o)
Current Assets
p)
Current Liabilities
100.00
%
19943.5
0
RATIOS :
q)
Current Ratio
r)
Debt/Equity :
Total Term
Liab./TNW
Total Outside Liab./
TNW
Profitability %:
PAT/Net Sales
DSCR a) Company
as a whole
b) For
specific TL
s)
t)
u)
v)
Interest Coverage
Inventory +
Receivables/ Sales
Debt quasi equity
ratio
95
#DI

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