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New Delhi: The Tata Group-owned Indian Hotels Co. Ltd (IHC) may spend around 2,000 crore to open 10 new hotels in the next five years under its Vivanta by Taj brand of upscale luxury hotels. This will include two hotels in Guwahati and Amritsar with about 150 rooms each, apart from one in Dubai.

“There is no set number for investment, but it typically costs a crore for a room," said Veer Vijay Singh, chief operating officer (COO), Vivanta Hotels and Resorts. “We have 6,000 rooms in our 40 hotels at present and we will add 2,000 rooms (globally) over the next five years," he said.

Singh was speaking on the sidelines of the launch of a new Vivanta by Taj hotel at Dwarka in Delhi on Monday, the 30th hotel under the five-year-old brand, and the seventh Taj Group property in the National Capital Region (NCR).

“At present, we have 30 Vivanta by Taj and 10 other hotels which we run as strategic business units (SBUs) under the company, but they have not been christened as Vivanta as yet," Singh said.

The company, which has Vivanta by Taj resorts in Sri Lanka, the Maldives and Malaysia, also plans to enter West Asia and Africa.

“We will be opening one Vivanta property in Dubai in the next three years," said Singh, adding, “we are actively looking at the African market to expand."

Of the 10 properties that the company runs as SBUs, “a couple of properties are in Bhutan and Zambia", which “will take some time to be converted to Vivanta".

The Taj Hotels, Resorts and Palaces launched the Vivanta by Taj brand in September 2010 with 19 hotels in the portfolio. By 2013 April, the number of hotels under the brand grew to 27.

The company declined to give the current revenue break-up for the Vivanta brand. Taj Hotels Resorts and Palaces, which comprises 93 hotels in 55 locations across India with an additional 16 international hotels in the Maldives, Malaysia, Australia, UK, US, Bhutan, Sri Lanka, Africa and the Middle East, owns and operates properties under the brands Taj, Taj Exotica, Taj Safaris, Vivanta by Taj Hotels and Resorts, The Gateway Hotels and Resorts and Ginger.

Analysts expect more luxury hotels to come up in India with the government attempting to raise tourist inflows.

“Although easing visa norms and the GoI’s (government of India’s) focus on tourism lend credence to a demand pick-up in the coming 12-18 months, inbound tourism will be impacted by global economic weakness," said a January 2015 report by ICRA Ltd. “Domestic demand continues to grow at a healthy pace both from the leisure and business traveller."

“Premium room supply pipeline (will) continue to be strong (in India) with 6,500 rooms to be added during 2014-15," it said. “India has over 29,000 premium rooms under construction currently, to be launched over the next six years. Over 30% of this supply is targeted at the National Capital Region."

However, it cautioned that “unless demand keeps pace, the widening supply-demand gap in major cities will impact rate integrity over the next two years".

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