OVERALL REVIEW
India is now the fastest growing, major economy in the world. The First Advance
Estimates of National Income released by the National Statistical Office (NSO) of the
Government of India in January 2023 estimates Indias GDP to have grown by 7.0% in FY
2022-23 following a growth of 8.7% in FY 2021-22. Total Consumption grew by 7.0% in FY
2022-23 mainly due to private consumption. Growth in exports for FY 2022-23 seems to have
plateaued at 12.5% while Imports grew by 20.9% in FY 2022-23. By sectors, agriculture grew
by 3.5% during FY 2022-23 after a growth of 3.0% in FY 2021-22. Mining grew by 2.4%,
manufacturing by 1.6% and construction by 9.1% while electricity, gas water supply and
other utilities services grew by 9.0% in FY 2022-23. Services sector exhibited the
strongest growth in FY 2022-23 at 9.1%. Within services, ‘trade, hotels, transport,
communication and broadcasting related services constituting about a third of overall
services, grew by 13.7%. The consensus of GDP growth for FY 2022-23 was in the range of
6.5% to 7.0%. (Source: India Economic Survey 2022-23 – January 2023 and National
Statistical Office estimates) Indias economic recovery from the pandemic exhibited a
K-Shaped recovery where certain sectors like information technology, e-Commerce and
financial services registered healthy recoveries while other sectors such as retail trade
and consumer discretionary were highly impacted. Travel and hospitality remained
beneficiaries of such recovery. The outlook for FY 2023-24 is optimistic. Global tourism
is steadily improving towards pre-pandemic levels consequent to the relaxation of travel
restrictions across countries and increase in demand for travel. Tourist arrivals
internationally for 2022 were 917 million, double that of 2021 but recovering to 63% of
pre-pandemic levels of 2019, according to data from the United Nations World Tourism
Organization (UNWTO).
In the Tourism Ministry, budgetary allocation for 2022-2023 stands at Rs 2400.00 crore
and is 18.42% higher than the Budget allocation for the year 2021-22 and 76.82% more than
the allocation of 2013-14. The Ministry of Tourism launched the NIDHI portal to understand
the geographical spread of the hospitality sector, its size, structure and existing
capacity in the country. NIDHI will serve as a common data repository for the Ministry of
Tourism, State Departments of Tourism and Industry; this will enable the Central and State
Governments to deliver better support and services including policies and strategies for
the tourism sector.
The launch of several branding and marketing initiatives by the Government of India
such as ‘Incredible India! and ‘Athiti Devo Bhava has provided a focused
impetus to growth. The Indian Government has also released a fresh category of visa - the
medical visa or M-visa, to encourage medical tourism in the country. The Government is
working to achieve 2% share in worlds international tourist arrivals by 2025.
The Indian Railway Catering and Tourism Corporation (IRCTC) runs a series of Bharat
Darshan tourist trains aimed at taking people to various pilgrimages across the country.
Post the pandemic crisis, the government plans to tap into regional tourism by opening
doors for South Asian country tourists. The Government is also making serious efforts to
boost investment in the tourism sector. In the hotel and tourism sector, 100% FDI (Foreign
Direct Investment) is allowed through the automatic route. A five-year tax holiday has
been offered for 2-, 3- and 4-star category hotels located around UNESCO World Heritage
sites (except Delhi and Mumbai). Government is planning to boost the tourism in India by
leveraging on the lighthouses in the country. 71 lighthouses have been identified in India
which will be developed as tourist spots. The lighthouses will feature museums,
amphi-theatres, open air theatres, cafeterias, childrens parks, eco-friendly cottages and
landscaping according to its capacity. Ministry has also setup an account on KOO for @
incredlibleindia &@ tourismgoi handles for enhancing its presence on different
platforms. Further, the social media promotions were carried out in both the Incredible
India and Ministry of Tourism platforms. The Ministry of Tourism along with Associations
of Indian Universities (AIU) initiated a 12 Episode Webinar series under ‘Ek Bharat
Sresth Bharat (EBSB) to engage and expose young minds of our country to the rich and
diverse heritage of the country so that they take pride in being Indian with a
responsibility to take forward a vibrant and modern nation.
The PM Gati Shakti master plan for expressways will facilitate speedier implementation
of development projects under the National Infrastructure Pipeline through the use of
technology to facilitate faster movement of people and goods, seamless multimodal
connectivity, economic transformation, and logistical synergy. The Gati Shakti master plan
is driven by 7 engines: roads, railways, airports, ports, mass transport, waterways, and
logistics infrastructure. All 7 engines further supported by energy transmission, IT
communication, bulk water, sewerage, and social infrastructure, will pull forward not just
the economy but will also play a role in boosting tourism in India.
1. FUTURE TRENDS
• Robust demand: By 2029, Indias tourism sector is expected to grow 6.7% to reach
Rs 35 trillion (US$ 488 billion), and accounting for 9.2% of the total economy.
• Diverse Attractions: India offers geographical diversity, attractive beaches, 37
World Heritage sites and 10 bio-geographic zones.
• Policy support: Campaigns such as Swadesh Darshan, a theme-based tourist circuit
was launched to harness the tourism industrys potential. Another new tourism policy
focusing on developing medical, religious tourism and adding more destinations to the
prevailing ones is also under consideration.
• A new Scheme named Loan Guarantee Scheme for COVID affected Tourism Service
Sector (LGSCATSS) has been started during the current financial year. Guarantee free loan
upto Rs 10.00 lakh each for Ministry of Tourism approved travel and tourism stakeholders
(Tour operator/Travel Agents/ Tourist Transport Operator) and up to Rs 1.00 Lakh each to
RLGs/IITGs approved by MoT, Tourist Guides approved by State Govt./UTs administration is
covered under the Scheme. The Scheme is to executed through NCGTC. Around ten Scheduled
Commercial Banks have launched the scheme and Cheques/ sanction letters have been
distributed to some of the beneficiaries of LGSCATSS An allocation of Rs 12.50 crore is
provided under the Ministrys Budget for 2022-23 for this purpose. The total allocation
proposed under the Scheme for five years is Rs 62.5 crores.
2. SECTOR OUTLOOK
Financial Year 2022-23 continued to be a year of strong recovery in the Indian travel
and tourism industry. Restrictions on flights were relaxed in most countries into and from
India. Travel restrictions, documentation and certifications were also progressively
relaxed for travel within India. Consequently, demand for accommodation grew
significantly, mainly arising from domestic leisure travel, weddings, social events,
conferences and resumption of business travel within the country. Foreign tourist arrivals
were 6.19 million for the calendar year 2022 in comparison with 1.52 million in 2021. The
outlook for the Indian hospitality industry during 2023 remains positive. The upsides
working in favour of the hospitality industry in India are good macroeconomic environment
evidenced by 6%+ GDP growth, superior performance by the services sector of the Indian
economy, abating COVID-19 fears, continuing infrastructure development projects within the
country, growth in air and railway passenger traffic and growth in demand for branded
rooms outpacing a tepid growth in supply of those rooms to provide long-term sustainable
demand. Moreover, the industry has learnt to work with volatility and adopt leaner cost
structures thus contributing to higher profitability. Balance Sheets of large corporates
have also strengthened over the past few years. Growth in the industry is largely expected
from domestic demand which is expected to remain strong through FY 2023-24 even as
international travel has shown green shoots of recovery and provides scope for further
growth in demand. Additionally, the Indias G20 Presidency and an opportunity to host
international events, including the ICC Mens World Cup, is expected to increase demand
for hotels in the cities hosting the events. Growth in Indias service sector and higher
disposable income of people working in it, is also expected to increase demand for
corporate travel and holidays. All segments of leisure, weddings, conferences events,
airline crew layovers and corporate travel are expected to grow further during the year.
3. SWOT ANALYSIS
Strengths
- A major strength for our Hotel is its preferred owned brands with its vast portfolio
commanding leadership in their market segments. Quality service from the said brand
strengthens the market position of hotels giving it its competitive edge as it seeks to
take advantage of increasing business. Strengthening individual services in the areas of
exclusive business meetings, food and spa to offer a wide spectrum of hospitality services
in accommodations and beyond.
- Ministry of Tourism has two major schemes viz. Swadesh Darshan - Integrated
Development of Theme- Based Tourist Circuits and PRASHAD Pilgrimage Rejuvenation and
Spiritual, Heritage Augmentation Drive for development of tourism infrastructure in the
country including historical places and heritage cities.
- The Government of Gujarat strongly initiated the promotion of tourism in Gujarat with
the slogan like "Kuch Din to Gujaro Gujarat mein."
- The Indian Government organized many types of International exhibitions and
Celebration in Gujarat providing impetus to hospitality industry.
- Launch of the "Incredible India 2.0" Campaign of the Ministry by the
Honble President of India during the National Tourism Awards function. The 2.0 Campaign
marks a shift from the generic promotions being undertaken across the world to market
specific promotional plans and content creation. The Campaign covers the important source
markets for Indian tourism and also takes into account emerging markets with significant
potential.
- A world level corporate conference viz. "Vibrant Gujarat", providing
impetus to hospitality industry.
- The promoters have an established track record, having created a niche for itself in
hospitality industry with good brand image for last 23 years.
- A loyal clientele base of corporate built-up over the years, providing a ready
customer base.
- Strategic location of the hotel in the immediate vicinity of Airport with
well-developed infrastructure gives it an added advantage over other competitors.
- Your Company continuously renovates its properties to meet the increasing competition
in the market and insured its property against natural and men made disasters.
- The Ummed Ahmedabad, Ahmedabads first Five star hotel is been fruitfully proceeding
its successful journey with all its pride.
- The hotel property of the company is situated just 1km from the airport and in close
proximity to the government and developing industrial areas makes this location an apt
choice for all the business travelers. The property is surrounded with greenery and
perfectly manicured lawns compliment the citys biggest open-air swimming pool. Enjoy the
tranquility of our guest rooms and suites, explore local and global cuisines at the
24-hour coffee shop and fine dining restaurant. The hotel is known for patronizing the
whos who of the worlds in recent days.
- Improvement of Road connectivity and Way Side amenities to the important Tourist
Destinations with the help of Ministry of Road. Transport & Highways (MoRTH). Ministry
of Tourism (MoT) has been pursuing the matter regarding improvement of road connectivity
to important tourist destinations with the Ministry of Road Transport &Highways
(MoRTH) and had submitted a list of50 Tourism Destinations to MoRTH for taking up in the
first phase. MoRTH has been requested to consider setting up of Wayside Amenities,
prominent sign-ages and beautification of the area, at a distance of 15-20 km where good
road connectivity already exists. Out of these 50 destinations, only 23 fall under the
purview of MoRTH / NHAI, where working in progress. The rest comes under the purview of
PWD, BRO and the respective State Govt. The Ministry has accordingly addressed letters to
the State Governments, PWD and BRO for improvement of road connectivity and provision of
way side facilities. Ministry of Tourism is further in the process of finalizing a further
list of 50 Tourist Destinations to be sent to MoRTH to take up in the second phase. For
this, Ministry is coordinating with States/UTs for their inputs.
Weaknesses
- Hospitality Industry suffers from event risks such as pandemic Covid-19, Lockdown,
terrorist attack, government stability, dollar and foreign currency condition, rupee
devaluation etc. the company is operating in area, which is prone to these risks.
- Hotel business in general is sensitive to fluctuation in the economy. Since, demand
for hotels is affected by economic growth; a global recession might lead to downturn in
the hotel industry.
- Since tourism is global phenomenon, any adverse developments on the geo-political
front are likely to impact global tourist flow and India is not an exception to same. The
future of the hospitality industry is very sensitive to the global security environment.
Opportunities
- Ahmedabad is emerging as a global city with a confluence of various culture, positive
political circumstances and values and also being a leading industrial city of India, the
Company will be able to exploit the business travel potential offered by the city.
- UNESCO has declared Ahmedabad as World Heritage City resulting into increase in
foreign visitors.
- At a time of the World Economy melt down, Global Investors envisage for safer
Investments and fetch assured returns. Investors look towards India and Gujarat has been a
preferred Investment Destination by way of Vibrant Gujarat Summit.
- The Government of Gujarat has declared and initiated many automobile projects
resulting into increase in foreign corporate visitors.
- With the increase in the demand of Gujarati Film and Entertainment Industry, the
related visitors also increased, who prefer our location only.
- The Government of Gujarat has declared and initiated many automobile projects
resulting into increase in foreign corporate visitors
- The Hotel is well established and the promoters with their experience have passed
through such phases without many adversities.
- Encapsulated in an oasis of warm and soothing surroundings, "The Ummed
Ahmedabad" is a low-rise property spread over four acres of manicured gardens. Feel
welcomed in one of the 91 rooms and suites, tastefully appointed using subtle tones,
styled with custom made teak furniture and convenient amenities. Elegantly appointed rooms
and suites overlook the landscaped gardens and tall trees around the hotel or provide
breathtaking views of the turquoise waters of the poolside. Classic Indian and regional
art adorn the rooms along with thoughtful amenities to ensure guests feel at home.
Threats
- Guest houses replace the hotels. This is a growing trend in the west and is now
catching up in India also, thus diverting the hotel traffic.
- Changing trends in the west demand similar changes in India, which here are difcult
to implement due to high project costs.
- Fluctuation in foreign tourist arrival. The total dependency on foreign tourists can
be risky, as there are wide fluctuations in international tourism.
4. FINANCIAL PERFORMANCE WITH RESPECT TO OPERTIONAL PERFORMANCE
The financial performance of the Company for the year 2022-23 is described in the
Directors Report under the head ‘FINANCIAL RESULTS.
5. SEGMENT WISE PERFORMANCE
The Company has only one segment i.e. Hotel Business.
6. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Internal Control Systems and their Adequacy of the company for the year 2022-23 are
described in the Directors Report under the head of ‘Internal Control Systems and
Their Adequacy.
7. HUMAN RESOURCE DEVELOPMENT/INDUSTRIAL RELATIONS
During the year, the Company maintained harmonious and cordial industrial relations. No
operating days were lost due to strike, lock out etc. Human Resources Development, in all
its aspects like training, safety and social values is under constant focus of the
management. The Management and the Employees are dedicated to achieve the corporate
objective and the targets set before the Company.
During the financial year 2022-23, the company has not received any complaints on
sexual harassment and hence no complaints remain pending as of March 31, 2023.
8. MATERIAL DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT,
INCLUDING NUMBER OF PEOPLE EMPLOYED
We admire our employees for better performance by taking seminars, exports talk and
healthy competition among them. We motivate them to do research and development of Hotel
Industries and welcome their suggestion if it achieves the benchmark of our standards.
Company understands the value of human capital and tries to preserve and develop it.
9. DETAILS OF SIGNIFICANT CHANGES (I.E. CHANGE OF 25% OR MORE AS COMPARED TO THE
IMMEDIATELY PREVIOUS FINANCIAL YEAR) IN KEY FINANCIAL RATIOS, ALONG WITH DETAILED
EXPLANATIONS THEREOF, INCLUDING:
Sr. No. Financial Ratios |
Year Ended 31.03.23 |
Year Ended 31.03.22 |
| 1 Debtors Turnover |
8.57 |
3.86 |
| 2 Inventory Turnover |
10.62 |
6.78 |
| 3 Interest Coverage Ratio* |
7.56 |
2.64 |
| 4 Current Ratio |
1.61 |
2.39 |
| 5 Debt Equity Ratio |
0.08 |
0.15 |
| 6 Operating Profit Margin (%) |
21.60 |
11.18 |
| 7 Net Profit Margin (%) |
17.88 |
6.97 |
* Improved business and lower finance costs resulted in improved Interest Coverage
Ratio and consequently Net Profit Margin
10. Details of any change in Return on Net Worth as compared to the immediately
previous financial year along with a detailed explanation thereof
Return on Net Worth for the Current Financial Year ended on 31.03.23 is 8.05% as
compared to 2.10% in Previous Financial Year ended on 31.03.22. ROI has significantly
improved as the Company has maintained healthy capital structure as is evident from debt
equity ratio and improved Net Profit Margin.
11. CAUTIONARY STATEMENT
Statements in the Management Discussion and Analysis Report describing the Companys
objectives, projections, estimates, predictions and expectations may be
"forward-looking statements" within the meaning of applicable securities laws
and regulations. As "forward- looking statements" are based on certain
assumptions and expectations of future events over which the Company exercises no control.
The Company assumes no responsibility to publicly amend, modify or revise the forward
looking statement on the basis of subsequent developments, domestic and international
economic conditions affecting demand, supply and price conditions in the hospitality
industry, changes in the Government regulations, tax regimes and other status.
|
By Order of the Board of Directors |
|
Sd/- |
|
Vishwajeet Singh U Champawat |
| Place: Ahmedabad |
Chairman and Managing Director |
| Date: 04/09/2023 |
(DIN: 00519755) |
+91-9892691696
