ITC invests close to ₹3,000 crore in Welcomhotels Sri Lanka
By: Staff Writer
Colombo (LNW): Official data from the Reserve Bank of India shows that in July, ITC invested $20 million in Welcomhotels Lanka Pvt Ltd equity
ITC Ltd, which recently announced the demerger of its hotels business, has made an equity investment of about ₹3,000 crore in Welcomhotels Lanka Pvt Ltd with the latest investment of $20 million.
Official data from the Reserve Bank of India shows that in July, ITC invested $20 million in Welcomhotels Lanka Pvt Ltd equity. According to Welcomhotels’ annual report, in FY23, the parent company (ITC Ltd) has ₹2,775-crore equity and preference capital.
The Sri Lankan property is spread across 5.86 acres of prime sea-facing land in Colombo, including a luxury hotel and a super-premium residential apartment complex – ‘Sapphire Residences’.
The property includes 352 rooms, suites and serviced apartments, and 12 restaurants. According to ITC Hotels’ web site, the hotel is slated to be completed in 2023.
According to the annual report, “The project construction activities, which had ramped up post the pandemic, were also impacted during the year on account of the challenging operating conditions prevalent in the country.
Despite these challenges, the company took all steps to expedite project work; significant progress was made during the year in the façade, finishes, mechanical, electrical, and plumbing works.”
However, it also mentioned that the muted business environment and macro-economic challenges faced by the country have impacted sales of ‘The Sapphire Residences’ luxury apartments.
“Given its unique positioning in the market and superior value proposition, it is anticipated that apartment sales would gain traction as the project nears completion and the situation in the country normalizes,” the company added.
“Project construction activity was running on schedule till Q3 of FY2018-19,” it said, adding that conditions were adversely impacted due to disruptions in the aftermath of the terror incidents in 2019, recurrent waves of Covid and the challenging socio-economic and operating conditions prevailing in the country over the last 18 months.
The government of Sri Lanka has undertaken several steps to stabilize the economy; these include securing financial assistance from multi-lateral agencies and other countries, increasing interest rates to curb inflation, restricting non-essential imports to conserve foreign exchange, introduction of taxes to boost government revenues, etc.