HOSPITALITY INDUSTRY

Financial Accounting & Control - Group Assignment on Financial

Statement Analysis

COMPANIES

Taj GVK Hotels and Resorts

Ltd.

Mahindra Holidays and Resorts India

Ltd.

Part A: Industry Analysis

The hospitality sector in India is estimated to be Rs. 1537 billion

in 2015.

Growth rate: 8%-10% annually

Market share of major players: Taj Group 25%, Oberoi 17%, ITC group 1.1%, Leela group 0.6%,

Others 0.5%

contributing 2% to GDP of India

Porter’s Five Forces of competitive power

Industry Rivalry:

High. The

likelihood of new

entrants is

moderate.

Threat of Substitut

e: LOW

. Supplier power is assessed

as moderate

overall.

. Thus Buyer

power is high.

S.W.O.T Analysis of Indian Hospitality Industry

STRENGTHS Wide variety of hotels International players in the market such as Taj and Oberoi Low manpower costs-high margins WEAKNESS

Cost of land in india is high at 50% of total project cost as against 15% abroadeaknessStaff to room ratio of 3:1, this ratio is 1:1 for international hotel Luxury tax and sales tax inflate the hotel bill by over 30%.

OPPORTUNITIES

Diverse topographyThe inbound tourists are a mere 0.49% of the global figuresHeritage hotels.

THREATS Guest houses Political turbulence, Insurgency in Jammu Kashmir Lack of training man power in the hotel industryhigh project costs

SWOT

Policy ProcurementIn the Hotel Industry Sector, Foreign Direct

Investment (FDI) has been permitted up to 100% under the automatic route

Make in IndiaA deduction of an amount equal to 100 % of

the profit and gain for the first 5 consecutive years to an undertaking derived profit from the business of a hotel located in the specified district having a World Heritage Site. If such hotel is constructed and has started functioning before 31st March, 2013.

Part B: Company analysis

Part C: Interpretation of findings from analysis

Part D: Group presentation topics