Newstrack

Govt plans Rs 237 cr capex for ITDC hotels

Profits show threefold growth in 2006

EH Staff - New Delhi

Ailing public sector unit India Tourism Development Corporation (ITDC) may get a fresh lease of life as the government plans to infuse equity capital of over Rs 237 crore for reviving Ashok Hotel, Samrat Hotel and Hotel Janpath in New Delhi.

The expenditure is set to be financed through market borrowings and government equity. The equity amounting to Rs 75 crore is proposed to be contributed by the tourism ministry, sources said. ITDC plans to raise Rs 97 crore through market borrowing from banks and financial institutions.

Moreover, chairman and managing director of ITDC, Parwez Dewan, announced that its profits for the period April-December 2006 increased from Rs 15.05 crore during the corresponding period in 2005 to an estimated Rs 44 crore in the first three quarters of 2006.

The tourism ministry had earlier announced that ITDC's profits had increased by a record 1346 per cent during the seven off-season months of April-October 2006 compared to the same period in 2005. The main growth has come from the Ashok Hotels Division which has made a profit of Rs 36 crore in April-December 2006, which is almost three times the profit earned in the same period in 2005. The duty-free business of the ITDC also showed an almost threefold rise in profits. Most divisions of the ITDC have shown improved performance over last year. However, within profitable divisions, some units such as the hotels at Jammu, Jaipur and Bhubaneshwar, continue to be in the red.