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Jan 19, 2015
TANGERINE HOTELS
Brainwave Management
Services
November 2010
Executive Summary
Confidential Information3
Tangerine Hotels
Executive Summary
An experienced Hospitality Management Team is looking to implement their concept of Luxury Hotel
Apartments in India
Tangerine will be competing in the 4 Star Hotel / Residential space with Luxury Hotel Apartments concept
The Team is looking at investment to take live the new concept in Indian Hospitality
Concept Introduction
Confidential Information5
Tangerine Hotels
Concept Introduction
Tangerine will be competing in the 4 Star Hotel Apartments/ Luxury Residential Space concept
The idea is to offer people a residential-style apartment with hotel-like amenities fulfilling clients Lifestyle
and Living needs
Apartment hotels fill up huge gap that exists for business travelers, family travelers and large groups which
hotels are not able to offer
Tangerine services Lifestyle and Living needs of business clientele and residential families through
infrastructure, service, speed and price structure
Target age group will be 25-50 with good disposable income, and limited leisure time
Amenities of an ultramodern Hotel with the comfort of Home
Confidential Information6
Tangerine Hotels
Concept Introduction
Homely atmosphere compared to a conventional hotel room
Facilities include Bedroom, Dining, Kitchen in the room
Hotel facilities include 24hour room service, housekeeping, laundry, security, doctor on call, salon & spa,
supermarket, conference rooms, ball room, swimming pool, fitness center and full fledged F&B services
Concept is aimed at Expatriate and Corporate executives, NRIs who come with their families, and medical
tourists
A Home with Top Business & Recreation Facilities
Confidential Information7
Tangerine Hotels
Concept Introduction
Focus on Luxury Lifestyle Apartments for Long & Short stays
60-100 rooms, 4 star category with Food & Beverages element
1 Coffee shop / All Day Dining
1 Lounge Bar / Specialty Restaurant
Conference & Banquet Facility
1 Board Room / 2 Meeting Rooms
1 Ball Room
1 Rooftop Concept Bar (concept bar at night)
Pool area, preferable covered
Open spaces, Gym, Recreation & Play area for kids
Supermarket
Salon & Spa
Confidential Information8
Tangerine Hotels
Design
Modern, Trendy, Chic & Cool
Touch of Finesse
Elements of nature blended in, fresh Flavors & Fragrances
Confidential Information9
Tangerine Hotels
Target Market
Tourists
Western Expats
Working Professionals in the age group of 25-50 years
Corporate & Business House
Families
Rooms
Confidential Information11
Tangerine Hotels
Rooms
Studio
1 Bedroom
2 Bedrooms
Rooms will have cable TV, Internet access, room service & housekeeping facilities & laundry services
Cooking mini kitchens/utensils/plates/glasses & cutlery/chinaware
All rooms will have a terrace or balcony
Food & Beverages
Confidential Information13
Tangerine Hotels
All Day Dining
o 80 covers
o Should give a feel of Home Kitchen
o 45 covers indoor & 35 covers outdoor /terrace / patio with a roof
o Breakfast, Lunch, Dinner
Confidential Information14
Tangerine Hotels
Specialty Restaurant
o International Cuisine
o 60covers
o 20 covers Bar
Confidential Information15
Tangerine Hotels
Pool Bar
o 40 covers
o 60 Sun Lounges
o Same level as coffee shop
Confidential Information16
Tangerine Hotels
Rooftop Bar / Lounge (with covered roof)
o Sheesha, Mezze & Tapas
o 80-100 covers
o Party place including events, promotions
Facilities
Confidential Information18
Tangerine Hotels
Board Rooms / Meeting Rooms
o 15 covers, all round table for Board Room
o 80 covers called Senate I & Senate II for Meeting Rooms
Confidential Information19
Tangerine Hotels
Ball Room
o 400 covers
o 3 doors with pre function area
Confidential Information20
Tangerine Hotels
Other Facilities (Optional & Location dependent)
Essentials Supermarket
o Supermarket in every Hotel
o Could follow outsourced business model
Salon & Spa
o Could follow strategic / outsourced business model
Laundry Services called “Laundromat”
Fitness Center
Travel Desk
Concept Positioning & Marketing
Confidential Information22
Tangerine Hotels
Positioning of Tangerine
Tangerine will be competing in the market void set between 4 star and 5 star with luxury hotel apartments
The brand will be positioned to be the number one choice for tourism and corporate sectors of India for
Lifestyle and Living needs based on service, speed and price structure
The hotel will cater to leisure guests, business clientele and residential families
The concept and brand is attractive and affordable to people from different walks of life
The brand will be launched in the most upcoming and growing cities catering primarily to families and
corporate sectors with main clientele being between 25-50 with limited time to enjoy a lifestyle
Confidential Information23
Tangerine Hotels
Marketing & Promotion
Press Conferences & Promotional Campaign
Discount Vouchers
Entertainer Vouchers
“Biggest Party in Town” campaigns
Fashion shows and Entertainment shows in tie-ups with fashion & entertainment companies in India and
from outside
Print Media- Lifestyle & Business magazines, F&B publication, Newspapers
Outdoor Campaigns
Cable TV, Radio and Satellite
Internet Marketing
Development and Expansion Plans
Confidential Information25
Tangerine Hotels
Development & Expansion Plans
The Management Team is looking at the metros in India for hotel development
Expansion plans will include Tier II cities with growth potential
Target markets include Mumbai, NCR , Chennai, Bangalore, Hyderabad, Ahmadabad, Pune, Kolkatta
Cities with growing GDP & business potential will be targeted first
Land / Real Estate (ready infrastructure) model used will be acquisition, lease or JV
The Team is looking at 5 hotels in the first 3 years
Indian Hotel Industry
Confidential Information27
Tangerine Hotels
Indian Hotel Industry
The Indian travel & tourism is ranked 5th in the long-term (10-year) growth
It is ranked the 14th best tourist destination in the world
Country Brand Index survey conducted by Future Brand puts India as “the best country brand for value-
for-money”
India is counted among the rising stars that are likely to become major tourist destinations in the next five
years
Confidential Information28
Tangerine Hotels
Road ahead for the Indian Hotel Industry
The demand for travel & tourism in India is expected to grow at healthy rate of 8% for the next 5-7 years
placing India at the 3rd position in the world
India is forecasted to become the fifth fastest growing business travel destination between 2010-2019
India’s travel & tourism sector is expected to be second largest employer in the world; providing jobs to
more than 40 million by 2019
This will attract FDI, global brands and new concepts into the Indian hospitality space
Confidential Information29
Tangerine Hotels
Low Phase to Growth Phase
The financial year 2008-2009 was not a very good year for the Indian Hotel Industry with Mumbai Terror
attacks and global economic slowdown
This resulted in overall decline in occupancy and revenue per available room
But the mood is upswing trend again in 2010 with global economy slowing moving out of recession and
India’s own growth story looking good again
Study of 6 big hotel groups in India shows expected revenue growth of 22%-25% till 2012
HVS Hospitality Services does see an opportunity in this weak period by describing this as “The best time
to make investments in hotel sector”
Today’s Low Phase seems the best investment opportunity to take advantage of the coming Growth Phase
Confidential Information30
Tangerine Hotels
Low Phase to Growth Phase
2010 is expected to see an increase in Revenue Per Available Room and Occupancy rates compared to
2009
Reserve Bank of India has recently has removed hotel industry from Commercial Real Estate
classification. This will ensure easier bank lending on much lesser rates as compared to earlier
The Government policies are expected to be more favorable
The domestic market has shown huge potential and continues to support the growing tourism industry
Many international hotel brands are keen to have a presence in India to include emerging market in their
portfolio to offset losses from mature markets
Government Policies and Domestic Market potential are expected to push Indian Hotel Industry again to Growth Phase
Confidential Information31
Tangerine Hotels
Growth in Hotel Rooms
Indian Hotel rooms are expected to be nearly double by 2014 compared to 2009 ; indicating high growth
23,185
48,475
94,115
10,000
25,000
40,000
55,000
70,000
85,000
100,000
1998-1999 2008-2009 2013-2014
No of Rooms
Confidential Information32
Tangerine Hotels
Occupancy Rate for Indian Hotel Industry
Indian Hotels enjoy a healthy occupancy rate of 62% ; expected to maintain an increasing trend over the next few years
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
1995
-96
1996
-97
1997
-98
1998
-99
1999
-00
2000
-01
2001
-02
2002
-03
2003
-04
2004
-05
2005
-06
2006
-07
2007
-08
2008
-09
2009
-10
Avg 62.2%
Confidential Information33
Tangerine Hotels
RevPAR for Indian Hotel Industry (in INR)
Indian Hotel Industry expects RevPAR to touch the 2006-2007 figures again in 2010-2011 on account of global economy revival and domestic business growth
0
1000
2000
3000
4000
5000
6000
1995
-96
1996
-97
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-98
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-00
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-03
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-04
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-05
2005
-06
2006
-07
2007
-08
2008
-09
2009
-10
RevPAR has recently seen a drop
due to terror attacks and
slowdown of global economy
The industry is bracing for growth
phase from 2010 onwards; which
is expected to show higher
RevPAR
Avg INR 3004
Confidential Information34
Tangerine Hotels
RevPAR numbers based on hotel status
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
1995
-96
1996
-97
1997
-98
1998
-99
1999
-00
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-05
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-06
2006
-07
2007
-08
2008
-09
Five Star Deluxe Five Star Four Star Three Star
Confidential Information35
Tangerine Hotels
Occupancy Rate numbers based on hotel status
35.0%
45.0%
55.0%
65.0%
75.0%
85.0%
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
Five Star Deluxe Five Star Four Star Three Star
Confidential Information36
Tangerine Hotels
Financial Aspects of the Hotel Industry
A financial analysis was done on India’s 6 big hotels
The goal was the analyze the coming years in terms of growth revenue and P/E valuation
Hotels studied were
Indian Hotels Company,
EIH (Oberoi Group of Hotels),
Hotel Leela,
Taj GVK Hotels,
Kamat Hotels and
Royal Orchid
Confidential Information37
Tangerine Hotels
Average Revenue Growth
17.9%
-9.1%
12.8%
22.0%
26.6%
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
2007-08 2008-09 2009-10 2010-11 2011-12
The Industry is forecasting strong Revenue Growth
Confidential Information38
Tangerine Hotels
Average P/E valuation
22.7x
32.5x
24.6x
15.9x
-
5.0x
10.0x
15.0x
20.0x
25.0x
30.0x
35.0x
2008-09 2009-10 2010-11 2011-12
The Industry expects favorable valuation in the coming years
Indian Hospitality Industry Trends
Confidential Information40
Tangerine Hotels
Indian Economy
Indian economy is expected to grow at projected GDP of more than 7% when other countries are
struggling to come out of negative growth
India’s resilient economy was only marginally affected by the global financial crisis
Exponential service sector growth with emergence of BPO, Telecom and other sectors
Indian younger demographics is the right fit for global business audience
India’s exponential FDI growth likely to continue- last 3 years (2007-2009) has seen $90 billion
The Indian Elephant is dancing on growth stories
Confidential Information41
Tangerine Hotels
Indian Hotel Market
The Indian Hotel Market has been growing from the days of 1990s when the handful of major hotel market
were limited to the big cities
Recent years have seen emergence of secondary and tertiary cities also
Infrastructure in Indian cities & towns have been continuously improved
India as a Brand has also been well accepted globally
There has been development of niche tourism like medical tourism, religious circuits, adventure tourism
Emergence of secondary cities has led to increase in hotel development activities; providing new expansion avenues
Confidential Information42
Tangerine Hotels
Hotel Brand Growth in India
There is a growing perception of Indian markets as a lucrative opportunity among international brands
Last few years have seen entry of major international brands in India and growth of Indian brands
Also expected is emergence of branded budget and economy hotels
Educated and well exposed Indian audience are likely to accept global brands and new concepts
Growth of the Indian middle class offering a large consumer base of more than 1 billion people
Indian and International Hotel Brands are being well accepted by growing Indian Middle Class
Confidential Information43
Tangerine Hotels
The M.I.C.E. Business Opportunity in India
Meetings, Incentive, Conventions, and Exhibitions business is a key contributor to overall hospitality
industry; accounting for 20% of all international arrivals worldwide.
Indian has seen growth of Science & Technology related industries like biotechnology and
pharmaceuticals that host large conference
Growth of the manufacturing sector
Increased interest in India as a travel-worthy destination
Expected emergence of dedicated convention centers in more cities
Successful and replicable model in Hyderabad International Convention Centre
Indian Hospitality Industry needs to make several strides towards developing MICE facilities
Confidential Information44
Tangerine Hotels
Hotel Development Costs
Hotel Development costs in India are expected to be rationalized due to market maturity and economic
conditions
Experts forecasts further rationalization of per key development costs with entry of brands across all
positioning
Industry is looking at favorable Government policies w.r.t license process
Current trend of building hotels is expected to shift to buying hotels once cost rationalization is seen in the market
Positioning
Luxury
Upper Upscale
Upscale
Mid Market
Budget
Economy
Typical development cost per key (INR millions)
12.5 and above
6 to 8.5
3.5 to 5.5
2.5 to 3.5
2.5 and below
8.5 to 12.5
Confidential Information45
Tangerine Hotels
Financial Aspects of the Hotel Industry
Industry has been lobbying for infrastructure status for the hotel industry. The Government is expected to
come out with favorable policy
This change in industry status will increase possibility of debt at reasonable rates; thus ensuring financial
maturity for the market
Industry is expecting more involvement of Private Equity and Hospitality Funds in the near future
This will bring about rise in sale /purchase of hospitality assets
Financial maturity will also bring in rationalization of valuations
The Indian Hospitality Industry is forecasting Financial Maturity with favorable policies and entry of financial institutions
Confidential Information46
Tangerine Hotels
Food and Beverages (F&B) Concepts
Recent years have seen rapid growth of standalone restaurants
Well traveled customer is open to different dining experiences
Entry of restaurant focused investors
The F&B space is looking at impetus from Government in form of ease of acquiring licenses
Indian F&B industry is in for some exciting and great times ahead
Management Team
Confidential Information48
Tangerine Hotels
Management Team
Management
Mr. Ashwin D’Cunha ; Managing Director
Mrs. Snigdha Banerjee D’Cunha ; Director Operations & actively involved in Food & Beverages
Mr. Shivraj Johar ; Business Head Hospitality
Mr. Sameer Despande ; Operations Manager and actively involved in Rooms Division
Mr. Rahul Kotyan ; Food & Beverages
Mr. Shaik Mohammad Sultan ; Corporate Chef
Origami / Bloombox ; Sales & Marketing
Advisors
Mr. Praveen Roy
Mr. Aldrin D’Cunha
Confidential Information49
Tangerine Hotels
Ashwin D’Cunha ; Managing Director
17 years experience in Food & Beverages, Project Management and Hotel operations across the globe
Worked with President Hotel, India; Carnival Cruise Lines, Miami, USA ; Atlas Hospitality Group, Dubai;
One & Only One Royal Mirage, Dubai; The Embassy Club, Dubai; Rendezvous Restaurants, India;
Bombay Palace Group of Restaurants, New York, USA
Type of Projects handled :
Management of Hotel and Food & Beverages operations
Human Resources- training & recruitment
Sales & Marketing planning for Hotels and Restaurants
Concept & Design Planning
Financial Planning for Hotels & Restaurants
Pre-Opening and Opening Project Management
Education
Honors student in PG Hotel Management Course from KC College, Mumbai India
Honors student in Food Production & Patisserie from IHM, Mumbai
Honors from “All Star Bartenders & Mixologist”, New York.
Honors from WSET UK; Wine and Spirit Advanced Education
Confidential Information50
Tangerine Hotels
Ashwin D’Cunha ; Managing Director
Major Projects
Pre-Opening and Post Opening Management of 3 hotels over 5 years for “One & Only Royal Mirage
Resort”- among the 10 best resorts in the world as declared by Conde Nast Traveler
Pre-Opening of Bombay Palace Restaurants in New York City, USA
Opened the “Embassy Club London” in Abu Dhabi – an enterprise of Mark Fuller & Andy Taylor (Co-
Manager of Iron Maiden, The Rock Group)
Started an entire vertical of Food & Beverage and Hotel Apartments for Elite Hospitality, Bahrain
Opened Dubai’s first Arabesque with 3 level concepts- sports bar, main dance & VIP bar
Concept of Nina, Dubai’s first Indo Euro Restaurant and Rooftop Lounge & Open Sky Bar
Concept, Design and Operations for “Food & Beverages” – a retail, lifestyle, dining & entertainment
venue in Bangalore
Concept and recruitment for Southern Sun, a Retail & 5 Star Hospitality venue in Dubai
Pre-Opening and Post-Opening Operations of 2 mega liners for Carnival Cruise Liners, Miami, USA
Confidential Information51
Tangerine Hotels
Ashwin D’Cunha ; Managing Director
One & Only Royal Mirage , Dubai
Elite Hospitality , Bahrain
Bombay Palace , New York
Among the 10 Best Resorts in the World
Embassy Club, Abu Dhabi
Confidential Information52
Tangerine Hotels
Snigdha Banerjee ; Director Operations
14 years experience in Food & Beverages, Project Management and Hotel operations across the globe
Worked with Taj Group of Hotels, UEI Global Hotel Education
Type of Projects handled :
Management of Food & Beverages operations
Human Resources- training & recruitment
Planning & Holding Events such as fashion shows, music album launches, product launch
Concept Planning
Pre-Opening and Opening Project Management
Set Up and Operations in India for UEI Global Hotel Education for Berggruen Group, USA
Education
Honors in Hotel Management from Indian Institute of Hotel Management (IIHM) by Taj Hotels India
Total Quality Management from Indian Institute of Hotel Management (IIHM) by Taj Hotels India
Confidential Information53
Tangerine Hotels
Snigdha Banerjee ; Director Operations
Major Projects
Pre-Opening and Post Opening Management of restaurants for “One & Only Royal Mirage Resort”-
among the 10 best resorts in the world as declared by Conde Nast Traveler
Set Up and Operations in India for UEI Global Hotel Education for Berggruen Group, USA
Restaurant Manager with The Taj Group of Hotels, India
Human Resources solutions for Southern Sun Hotel, Dubai
Confidential Information54
Tangerine Hotels
Snigdha Banerjee ; Director Operations
One & Only Royal Mirage , DubaiTaj Group of Hotels , India UEI Global Education India
Among the 10 Best Resorts in the World
Confidential Information55
Tangerine Hotels
Shivraj Johar ; Business Head
19 years experience in Food & Beverages industry spread across Luxury Hotels, Banqueting and
Restaurant Chains
Worked in Taj Group of Hotels for over 10 years in India and Maldives; Mayfair Celebrations – Gravis
Hospitality, India; Jones Lang LaSalle, India
Type of Projects handled :
Pre-Opening and Operation of large Food & Beverages operations
Operations and Business Development of 5 Star Hotels
Restaurant Operations
Education
Diploma in Hotel Management, Catering Technology & Applied Nutrition from Institute of Hotel
Management Chennai
Confidential Information56
Tangerine Hotels
Shivraj Johar ; Business Head
Major Projects
Opened and Operated Taj Hotel in Maldives
Part of the Food & Beverages Team to launch Taj Residency in Vishakhapatnam
Operations for Mayfair Celebrations (Gaylord Restaurant) across North India
Handled Integrated Facilities Business Line for Jones Lang LaSalle, India
Confidential Information57
Tangerine Hotels
Shivraj Johar ; Business Head
Taj Resort Maldives Gaylord Restaurant, New Delhi
Taj Residency, Vishakhapatnam
Confidential Information58
Tangerine Hotels
Sameer Deshpande ; Operations Manager
15 years experience in Hospitality Operations and Management
Worked with Elite Group, Bahrain; Palms Hotel, India ; Sahara India Parivar, India; & Sahil Resorts, India
Type of Projects handled :
Day to Day operations of a hotel
Maintaining service standards
Pre-Opening Management
Team Building
Inspection & Compliances
Quality Control
Budgeting and Manpower planning to make operations cost effective and in line with business goals
Education
Bachelors in Hotel Management from The Presidency College Of Hotel Management, India
Confidential Information59
Tangerine Hotels
Sameer Deshpande ; Operations Manager
Major Projects
Operations Manager for Apartment Hotel of Elite Hospitality with 298 rooms in Bahrain
Pre-Opening and Opening of Sahil Sarovar Hotel in Lonvala, India
Concept and Planning for Radisson Spa & Resort, Alibaug
Conceptualization and Pre-Opening for 6 multi-cuisine restaurants at Amby Valley Sahara Lake City
Confidential Information60
Tangerine Hotels
Sameer Deshpande ; Operations Manager
Elite Hospitality , Bahrain
Radission Resorts & Spa, Alibaug
Sarovar Hotel & Amby Valley , Lonvala
Confidential Information61
Tangerine Hotels
Rahul Kotyan ; Food & Beverages
14 years of experience in Food & Beverages operations within Hotels, Multi-unit Restaurant operations
and Pre-Opening & Project Startups
Worked with Taj Group; Ramee Group of Hotels; Flora Hotels, Dubai; MARS Restaurant, India and
Lite Bite Foods, India
Type of Projects handled:
Heading Food & Beverages operations including Restaurants, Banquets, Conferences, Catering
Pre-Opening project operations
Menu Planning
Vendor and Product Sourcing
Team recruitment and training
Formulating standards and procedures
Education
Advanced Diploma in Hospitality Management from Australian College of Travel & Hospitality
Management, Melbourne.
Diploma in Hotel Management, Catering & Nutrition from Institute of Hotel Management, Catering and
Nutrition, Ahmedabad
Confidential Information62
Tangerine Hotels
Rahul Kotyan ; Corporate Head Food & Beverages
Major Projects
Mumbai Operations for Lite Bite Foods with responsibilities including branding, operations, feasibility
evaluation, recruitment & training, setting up systems, vendor handling
Handling Food & Beverages operations for 2 hotel apartments of Flora Hotels, Dubai
Pre-Opening and Operations of 7 restaurants at Ramee Royal Hotel, Dubai
Operations of 4 restaurants, nightclub and 24 hour room service with a team of 76 at Gordon House
Mumbai & Pune
Pre-Opening of Masala Bay restaurant at Taj Land’s End, Mumbai
Confidential Information63
Tangerine Hotels
Rahul Kotyan ; Food & Beverages
Flora Park Hotel, Dubai
Ramee Hotel, Dubai
Masala Bay Restaurant, Taj Land’s End, Mumbai
Confidential Information64
Tangerine Hotels
Shaik Mohammad Sultan ; Corporate Chef
Culinary professional with more than 20 years of experience in industry and academia
Worked with Taj Group of Hotels, Elite Group Bahrain, Shri Shakti College of Management and
Osmania University
Type of Projects handled:
Oversee Food & Beverages operations
Selection, Planning, Requisitioning for supplies and approval of Standard of Supplies
Coordinate the Planning of menus like-, Daily Buffets, Theme menus for banquets & food festivals
Controlling of all operational costs; food, labor and materials
Banquet Kitchen and Conference Operations standardization
Designing of facilities requirements in coordination & consultation with the builder, equipment
manufacturers and suppliers
Education
Diploma in Hotel Management from Institute of Hotel Management, Catering Technology & Applied
Nutrition, Hyderabad
Confidential Information65
Tangerine Hotels
Shaik Mohammad Sultan ; Corporate Chef
Major Projects
Setting up 2 Hotel properties’ kitchen operations from ground zero in tandem with requirements on its
catering role, budgets and desired business returns at the Elite Group, Bahrain
Sous Chef for Majorda Beach Resort, Goa, India
Chef De Partie at Taj Banjara, Hyderabad, India
Faculty; Food Production at Shri Shakti College of Management and Osmania University, Hyderabad
Confidential Information66
Tangerine Hotels
Shaik Mohammad Sultan ; Corporate Chef
Elite Resort & Spa , Bahrain
Majorda Resort & Spa, Goa
Taj Banjara, Hyderabad
Confidential Information67
Tangerine Hotels
Origami / Bloombox ; Sales & Marketing (optional)
25 years experience in Hospitality Sales & Marketing
Worked for various projects of Hospitality Groups, Carmasutra, Gsport, Rogue Beer
Type of Projects handled :
Sales & Marketing Strategy
Brand Standards and Corporate Brand Development
Developing and Controlling Marketing and Advertising budgets
Database management & CRM
Public Relations, Media Buying, Media Relations, Road shows with major international property
developers
Strategic & Promotional Tie-ups
Confidential Information68
Tangerine Hotels
Praveen Roy ; Advisor
25+ years stalwart of Indian Hospitality Industry
He has set up various hospitality projects across India and Internationally
Work experience includes Taj Group of Hotels for over 18 years and successful creation of Indian Institute
of Hotel Management (IIHM)
Dean of IIHM and General Manager of the Taj Hotel
Setup of UEI Global Hotel Education in India for Berggruen Group, USA
Currently assisting Restructuring of Baisan Hospitality Institute and Hotels in Bahrain
Aldrin D’Cunha ; Advisor
A Visionary & Guiding Force for the team
An Advertising & Media expert
Setup Brainwave Advertising in Dubai and holds worldwide royalty for Qatar Yellow Pages
Member of Launch Team of Tata Yellow Pages in Mumbai
An Entrepreneurial and Business mindset
Financials
Confidential Information70
Tangerine Hotels
Financial Assumptions for a 80 room 4 Star Hotel with Luxury Apartments
Starting with 80 rooms 4 Star Hotel with luxury Apartments as 1) Land buyout & 2) Land Lease
Costs – Land Buyout
Total project costs with land, license, development and working capital Rs.101.80 crores
Development costs per room is ~ Rs.80 lacs ($0.2 m) including F&B and other facilities
Land cost for ~ 4 acres is ~ Rs.30 crores ($6.7m)(land appreciation at 25% every year)
Working capital required of ~ Rs.3.8 crores($0.85m) including management expenses
License fees of Rs.5 crores ($1.2m) (assumed to be sold for Rs.5 crores during exit)
Pre-opening costs including salary of employees/management accounted for
Financials
Equity: Debt ratio at 50:50
Debt paid over 10 years with 1 year moratorium
Bank interest rate at 12%
Corporate Tax at 33.5%
Confidential Information71
Tangerine Hotels
Financial Assumptions
Operations
Average revenue per room & Occupancy Rate lowest during monsoon quarter and higher during year end
quarter
Average occupancy assumed at 67% over 7 years
Average RevPar over 7 years comes to Rs.6850 per room ($152)
Revenue from F&B to be at an average of 29% of room revenue (below current levels of 35%-40% seen in
other hotels)
Other revenue includes facilities such as spa, salon, laundromat, supermarket, traveling, etc
Confidential Information72
Tangerine Hotels
Source & Use of Funds (INR lacs)
Sources of Funds
Amount % of Total
Credit Facility 0.0 0%
Debt 5,090.0 50%
Equity 5,090.0 50%
10,180.0 100%
Use of Funds
Amount % of Total
Hotel 9,800.0 96.3%
Working Capital 380.0 3.7%
Transaction Fees 0.0 0.0%
Other 0.0 0.0%
10,180.0 100.0%
Confidential Information73
Tangerine Hotels
P&L Statement (INR lacs)
No of roomsAverage Occupancy Rate
Average Revenue per Room
RevPAR
Room Revenue
% of Total Revenue
F&B Revenue
% of Total Revenue
Total Revenue
Growth
EBITDA
% margin
Net income
% margin
Year I Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
80 80 80 80 80 80 80
63.8% 63.8% 68.8% 68.8% 68.8% 68.8% 68.8%
7,250 8,700 9,570 10,527 11,053 11,606 12,186
4,622 5,546 6,579 7,237 7,599 7,979 8,378
991.8 1,611.4 1,910.3 2,101.3 2,206.4 2,316.7 2,432.6
68.7% 71.3% 71.5% 72.5% 73.0% 73.5% 74.0%
342.0 495.7 588.1 617.5 632.9 648.7 664.9
23.7% 21.9% 22.0% 21.3% 21.0% 20.6% 20.2%
1,443.2 2,261.3 2,673.0 2,896.9 3,021.0 3,150.8 3,286.5
56.7% 18.2% 8.4% 4.3% 4.3% 4.3%
794.9 1,296.7 1,544.8 1,683.4 1,753.4 1,826.6 1,903.2
55.1% 57.3% 57.8% 58.1% 58.0% 58.0% 57.9%
(93.7) 264.3 455.1 578.1 658.7 751.4 798.6
-6.5% 11.7% 17.0% 20.0% 21.8% 23.8% 24.3%
Confidential Information74
Tangerine Hotels
Debt Payment Ability(INR lacs)
Year I Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
5,090.0 4,901.5 4,713.0 4,524.4 4,335.9 4,147.4 3,958.9
610.8 596.7 574.0 551.4 528.8 506.2 517.5
6.4x 3.8x 3.1x 2.7x 2.5x 2.3x 2.1x
1.3x 2.2x 2.7x 3.1x 3.3x 3.6x 3.7x
Debt
Interest expense
Debt / EBITDA
EBITDA/ Interest
Confidential Information75
Tangerine Hotels
Exit Return with Enterprise Value @3.5x of revenue (INR lacs)
Plus Cash
Plus Working Capital
Less Credit Facility
Less Senior Debt
Plus: License
Net Equity Value
Hotel IRR
Payback multiple
Total IRR
Payback multiple
Total Enterprise Value
Year I Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
5,051.3 7,914.6 9,355.5 10,139.2 10,573.5 11,027.7 11,502.9
NA 30% 36% 34% 30% 27% 25%
0.4x 1.7x 2.5x 3.2x 3.7x 4.2x 4.8x
-11% 27% 30% 29% 27% 26% 25%
0.9x 1.6x 2.2x 2.7x 3.3x 4.0x 4.8x
89.1 399.3 885.2 1,533.3 2,288.3 3,097.9 4,067.4
433.4 514.1 609.8 666.1 696.4 598.7 522.2
0.0 0.0 0.0 0.0 0.0 0.0 0.0
5,090.0 4,901.5 4,713.0 4,524.4 4,335.9 4,147.4 3,958.9
500.0 500.0 500.0 500.0 500.0 500.0 500.0
0.0 0.0 0.0 0.0 0.0 0.0 0.0
983.9 4,426.4 6,637.5 8,314.3 9,722.3 11,076.9 12,633.5
Confidential Information76
Tangerine Hotels
Financial Assumptions for a 80 room 4 Star Hotel with Luxury Apartments
Starting with 80 rooms 4 Star Hotel with luxury Apartments as 1) Land buyout & 2) Land Lease
Costs – Land Lease
Total project costs with land lease, license, development and working capital Rs.101.80 crores (78 crores
?)
Development costs per room is ~ Rs.80 lacs ($0.2 m) including F&B and other facilities
Land Lease ~ 4 acres is ~ Rs.4 crores ($0.89m) (deposit of 5 crores ($1.2m) to be replaced during exit)
Working capital required of ~ Rs.5 crores ($1.2m) including management expenses
License fees of Rs.5 crores ($1.2) (assumed to be sold for Rs.5 crores during exit)
Pre-opening costs including salary of employees/management accounted for
Financials
Equity: Debt ratio at 50:50
Debt paid over 10 years with 1 year moratorium
Bank interest rate at 12%
Corporate Tax at 33.5%
Confidential Information77
Tangerine Hotels
Financial Assumptions
Operations
Average revenue per room & Occupancy Rate lowest during monsoon quarter and higher during year end
quarter
Average occupancy assumed at 67% over 7 years
Average RevPar over 7 years comes to Rs.6850 per room ($152)
Revenue from F&B to be at an average of 29% of room revenue (below current levels of 35%-40% seen in
other hotels)
Other revenue includes facilities such as spa, salon, laundromat, supermarket, traveling, etc
Confidential Information78
Tangerine Hotels
Source & Use of Funds (INR lacs)
Sources of Funds
Amount % of Total
Credit Facility 0.0 0%
Debt 3,900.0 50%
Equity 3,900.0 50%
7,800.0 100%
Use of Funds
Amount % of Total
Hotel 7,300.0 93.6%
Working Capital 500.0 6.4%
Transaction Fees 0.0 0.0%
Other 0.0 0.0%
7,800.0 100.0%
Confidential Information79
Tangerine Hotels
P&L Statement (INR lacs)
No of roomsAverage Occupancy Rate
Average Revenue per Room
RevPAR
Room Revenue
% of Total Revenue
F&B Revenue
% of Total Revenue
Total Revenue
Growth
EBITDA
% margin
Net income
% margin
Year I Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
80 80 80 80 80 80 80
63.8% 63.8% 68.8% 68.8% 68.8% 68.8% 68.8%
7,250 8,700 9,570 10,527 11,053 11,606 12,186
4,622 5,546 6,579 7,237 7,599 7,979 8,378
991.8 1,611.4 1,910.3 2,101.3 2,206.4 2,316.7 2,432.6
68.7% 71.3% 71.5% 72.5% 73.0% 73.5% 74.0%
342.0 495.7 588.1 617.5 632.9 648.7 664.9
23.7% 21.9% 22.0% 21.3% 21.0% 20.6% 20.2%
1,443.2 2,261.3 2,673.0 2,896.9 3,021.0 3,150.8 3,286.5
56.7% 18.2% 8.4% 4.3% 4.3% 4.3%
394.9 876.7 1,103.8 1,220.3 1,267.2 1,316.1 1,367.1
27.4% 38.8% 41.3% 42.1% 41.9% 41.8% 41.6%
(322.1) 59.3 243.1 343.2 399.7 463.8 495.6
-22.3% 2.6% 9.1% 11.8% 13.2% 14.7% 15.1%
Confidential Information80
Tangerine Hotels
Debt Payment Ability(INR lacs)
Debt
Interest expense
Debt / EBITDA
EBITDA/ Interest
Year I Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
3,900.0 3,755.6 3,611.1 3,466.7 3,322.2 3,177.8 3,033.3
468.0 457.2 439.8 422.5 405.2 387.8 396.5
9.9x 4.3x 3.3x 2.8x 2.6x 2.4x 2.2x
0.8x 1.9x 2.5x 2.9x 3.1x 3.4x 3.4x
Confidential Information81
Tangerine Hotels
Exit Return with Enterprise Value @3.5x of revenue (INR lacs)
Plus Cash
Plus Working Capital
Less Credit Facility
Less Senior Debt
Plus: License
Net Equity Value
Hotel IRR
Payback multiple
Total Enterprise Value
Year I Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
5,051.3 7,914.6 9,355.5 10,139.2 10,573.5 11,027.7 11,502.9
30.1 181.7 502.3 962.4 1,505.3 2,084.9 2,773.4
384.1 462.3 555.4 609.1 636.4 535.8 459.2
0.0 0.0 0.0 0.0 0.0 0.0 0.0
3,900.0 3,755.6 3,611.1 3,466.7 3,322.2 3,177.8 3,033.3
500.0 500.0 500.0 500.0 500.0 500.0 500.0
500.0 500.0 500.0 500.0 500.0 500.0 500.0
2,565.5 5,803.0 7,802.1 9,244.1 10,393.0 11,470.6 12,702.2
NA 17% 22% 21% 20% 18% 17%
0.6x 1.4x 1.8x 2.2x 2.4x 2.7x 3.0x
Financials in USDLand Buyout Model
Confidential Information83
Tangerine Hotels- Land Buyout
Source & Use of Funds ($ million)
Sources of Funds
Amount % of Total
Credit Facility 0.0 0%
Debt 11.3 50%
Equity 11.3 50%
22.6 100%
Use of Funds
Amount % of Total
Hotel 21.8 96.3%
Working Capital 0.8 3.7%
Transaction Fees 0.0 0.0%
Other 0.0 0.0%
22.6 100.0%
Confidential Information84
Tangerine Hotels
P&L Statement ($ million)
No of roomsAverage Occupancy Rate
Average Revenue per Room
RevPAR
Room Revenue
% of Total Revenue
F&B Revenue
% of Total Revenue
Total Revenue
Growth
EBITDA
% margin
Net income
% margin
Year I Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
80 80 80 80 80 80 80
63.8% 63.8% 68.8% 68.8% 68.8% 68.8% 68.8%
161.1 193.3 212.7 233.9 245.6 257.9 270.8
102.7 123.3 146.2 160.8 168.9 177.3 186.2
2.2 3.6 4.2 4.7 4.9 5.1 5.4
68.7% 71.3% 71.5% 72.5% 73.0% 73.5% 74.0%
0.8 1.1 1.3 1.4 1.4 1.4 1.5
23.7% 21.9% 22.0% 21.3% 21.0% 20.6% 20.2%
3.2 5.0 5.9 6.4 6.7 7.0 7.3
56.7% 18.2% 8.4% 4.3% 4.3% 4.3%
1.8 2.9 3.4 3.7 3.9 4.1 4.2
55.1% 57.3% 57.8% 58.1% 58.0% 58.0% 57.9%
(0.2) 0.6 1.0 1.3 1.5 1.7 1.8
-6.5% 11.7% 17.0% 20.0% 21.8% 23.8% 24.3%
Confidential Information85
Tangerine Hotels
Debt Payment Ability($ million)
Debt
Interest expense
Debt / EBITDA
EBITDA/ Interest
Year I Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
11.3 10.9 10.5 10.1 9.6 9.2 8.8
1.4 1.3 1.3 1.2 1.2 1.1 1.1
6.4x 3.8x 3.1x 2.7x 2.5x 2.3x 2.1x
1.3x 2.2x 2.7x 3.1x 3.3x 3.6x 3.7x
Confidential Information86
Tangerine Hotels
Exit Return with Enterprise Value @3.5x of revenue ($ million)
Plus Cash
Plus Working Capital
Less Credit Facility
Less Senior Debt
Plus: License
Net Equity Value
Hotel IRR
Payback multiple
Total Enterprise Value
Year I Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
11.2 17.6 20.8 22.5 23.5 24.5 25.6
0.2 0.9 2.0 3.4 5.1 6.9 9.0
1.0 1.1 1.4 1.5 1.5 1.3 1.2
0.0 0.0 0.0 0.0 0.0 0.0 0.0
11.3 10.9 10.5 10.1 9.6 9.2 8.8
1.1 1.1 1.1 1.1 1.1 1.1 1.1
0.0 0.0 0.0 0.0 0.0 0.0 0.0
2.2 9.8 14.7 18.5 21.6 24.6 28.1
NA 30% 36% 34% 30% 27% 25%
0.4x 1.7x 2.5x 3.2x 3.7x 4.2x 4.8x
Total IRR
Payback multiple
-11% 27% 30% 29% 27% 26% 25%
0.9x 1.6x 2.2x 2.7x 3.3x 4.0x 4.8x
Financials in USDLand Lease Model
Confidential Information88
Tangerine Hotels- Land Lease
Source & Use of Funds ($ million)
Sources of Funds
Amount % of Total
Credit Facility 0.0 0%
Debt 8.67 50%
Equity 8.67 50%
17.3 100%
Use of Funds
Amount % of Total
Hotel 16.2 93.6%
Working Capital 1.1 6.4%
Transaction Fees 0.0 0.0%
Other 0.0 0.0%
17.3 100.0%
Confidential Information89
Tangerine Hotels
P&L Statement ($ million)
No of roomsAverage Occupancy Rate
Average Revenue per Room
RevPAR
Room Revenue
% of Total Revenue
F&B Revenue
% of Total Revenue
Total Revenue
Growth
EBITDA
% margin
Net income
% margin
Year I Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
80 80 80 80 80 80 80
63.8% 63.8% 68.8% 68.8% 68.8% 68.8% 68.8%
161.1 193.3 212.7 233.9 245.6 257.9 270.8
102.7 123.3 146.2 160.8 168.9 177.3 186.2
2.2 3.6 4.2 4.7 4.9 5.1 5.4
68.7% 71.3% 71.5% 72.5% 73.0% 73.5% 74.0%
0.8 1.1 1.3 1.4 1.4 1.4 1.5
23.7% 21.9% 22.0% 21.3% 21.0% 20.6% 20.2%
3.2 5.0 5.9 6.4 6.7 7.0 7.3
56.7% 18.2% 8.4% 4.3% 4.3% 4.3%
0.9 1.9 2.5 2.7 2.8 2.9 3.0
27.4% 38.8% 41.3% 42.1% 41.9% 41.8% 41.6%
(0.7) 0.1 0.5 0.8 0.9 1.0 1.1
-22.3% 2.6% 9.1% 11.8% 13.2% 14.7% 15.1%
Confidential Information90
Tangerine Hotels
Debt Payment Ability($ million)
Debt
Interest expense
Debt / EBITDA
EBITDA/ Interest
Year I Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
8.7 8.3 8.0 7.7 7.4 7.1 6.7
1.0 1.0 1.0 0.9 0.9 0.9 0.9
9.9x 4.3x 3.3x 2.8x 2.6x 2.4x 2.2x
0.8x 1.9x 2.5x 2.9x 3.1x 3.4x 3.4x
Confidential Information91
Tangerine Hotels
Exit Return with Enterprise Value @3.5x of revenue ($ million)
Plus Cash
Plus Working Capital
Less Credit Facility
Less Senior Debt
Plus: License
Net Equity Value
Hotel IRR
Payback multiple
Total Enterprise Value
NA 17% 22% 21% 20% 18% 17%
0.6x 1.4x 1.8x 2.2x 2.4x 2.7x 3.0x
Year I Year 2 Year 3 Year 4 Year 5 Year 6 Year 7
11.2 17.6 20.8 22.5 23.5 24.5 25.6
0.1 0.4 1.1 2.1 3.3 4.6 6.2
0.9 1.0 1.2 1.4 1.4 1.2 1.0
0.0 0.0 0.0 0.0 0.0 0.0 0.0
8.7 8.3 8.0 7.7 7.4 7.1 6.7
1.1 1.1 1.1 1.1 1.1 1.1 1.1
1.1 1.1 1.1 1.1 1.1 1.1 1.1
5.7 12.9 17.3 20.5 23.1 25.5 28.2
Exit Strategy
Confidential Information93
Tangerine Hotels
Exit Strategy for Angel Investor
Share buyback by the Team after 4-7 years
PE funding to initiate the growth of chain of hotels
Sell Out to Strategic Buyer
Confidential Information
Thank You
94
Ashwin D’Cunha
Email: [email protected]
Mobile: + 91 9619279635
Bharat Vasandani
Email: [email protected]
Mobile: +91 9820789895