Hot Seat

Taking A Steady And Humble Growth Route

From Shimla to Bangalore, Chander K Baljee, the chairman and managing director of Royal Orchid Hotels, has steered his company to success with equal measure of patience and intellect. Vyas Sivanand finds out the secret and his future plans…

Chander K Baljee CMD, Royal Orchid Hotels

Chander K Baljee never comes across as a person who is on the verge of a massive augmentation drive in the Indian hospitality industry. Humble in his demeanour, Baljee has had the resolve, patience, and the sensibility to use a calculated approach towards growth and success. For it is not easy to perceive success, especially when you start with nothing commendable that too in an unknown territory.

Having grown up in a family of hoteliers in Shimla, Baljee always had an inclination towards the hospitality industry. Quite naturally, he got down to family business after he completed his studies. And today he runs the Royal Orchid Hotels.

It was his deftness to believe in himself that made him dream of making it big on his own. Baljee earned an MBA from IIM-Ahmedabad, following which instead of taking up highly paid jobs, Baljee took the risky step of venturing into his stream of family business elsewhere. His idea being that he saw less potential of growth in the existing market in Shimla apart from his reluctance to compete with his family members.

A chance meeting with a tourism department official from Karnataka in Shimla brought Baljee to Bangalore. The official informed him of a hotel in Bangalore that was available on lease. “I wanted to move out of Shimla and do something of my own. I could have gone to any place like Delhi or Chandigarh, but at that time the Bangalore proposal seemed pertinent,” recollects Baljee.

Baljee’s journey started in Bangalore in 1973, when he took over Hotel Stay Long and launched it as Hotel Harsha. “Bangalore was home to several public sector units like HMT, BHEL, BMEL etc and was popularly known as a public sector town. For me, the 70s was pretty bad but then there was no going back and I loved the city too. But there was a lot of struggle.”

Baljee then began expansion in 1985, when he acquired the land near Airport Road, which now houses the Royal Orchid. “Litigation delayed ownership till 1998, when the Supreme Court cleared the way. We started Royal Orchid in 2001. The hotel now has 200 rooms,” notes Baljee. Baljee tied up with Park Inn and Park Plaza for the hotel but later backed out and launched its own management company.

Baljee currently runs five hotels in the city, which includes the five-star hotel- Royal Orchid - a four-star property, Central Park - a three-star hotel, Harsha - a heritage property, Dominion Club - a recently acquired luxury resort and Metropole in Mysore. He also runs a hotel management institute in Bangalore - Presidency College.

With huge expansion plans, Royal Orchid also announced its intention of hitting the market with an IPO. The group underwent a complete re-branding exercise recently. The Royal Orchid Hotels also announced that WestBridge Capital Partners would be making a significant equity investment in the company. WestBridge Capital Partners has bought about 10 per cent stake the group for Rs 250 million.

Royal Orchid hotels is looking at increasing their portfolio by adding another six properties in the country. The company is looking at a total investment of Rs 250 crore approximately for the expansion, out of which about Rs 100-150 crore would be through equity and the rest through debt. Royal Orchid posted a net profit of Rs 130 million in the last fiscal year to March 2005.

“We see good potential in secondary cities like Chandigarh, Jaipur, Ahmedabad, etc, and would be aggressively targeting these cities with our Royal Orchid Central brand apart from other metros,” informs Baljee. The hotel company will expand by way of acquisitions, greenfield projects, revenue sharing basis, franchise and management options. The hotel is also aiming for an international tie-up.

Baljee says that he is open to the option, however, it will be done at a later stage. “Currently we want to build a strong base in the country by establishing the brand in every potential market and segment of hospitality. Once we have consolidated, we would look at acquiring a master franchise of an international hospitality brand for India,” confirms Baljee. Baljee has also encouraged his son, Arjun Baljee to enter the food business. Arjun now looks after the food and beverage segment and has launched fast food outlets in the city named Takatak.

With many more projects lined up for the coming years, looks like Chander Baljee is all set to take Royal Orchid hotels to the pinnacle in the Indian hospitality panorama.