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India Timeshare News: July 1, 2017

happyhourgatehouse >> INTERNATIONAL TIMESHARE NEWS

HYDERABAD: There’s a company in India that may or may not be familiar to you, but Indians are certainly familiar with it. It’s called Country Club Hospitality & Holidays Limited and it’s pretty darned big. How big IS it? Well…

It’s engaged in the sale of vacation ownership and other related services. It provides holiday facilities, guest accommodation, training/coaching in recreational activities relating to art, culture and sports, fitness training and clubbing to its members. It also offers room rentals, and food and beverages services. It also offers approximately 20 member fitness centers and over 4,000 holiday exchange associates and Country Vacations global hospitality associates. Its network consists of social clubs in urban hotspots, wellness rejuvenation hubs, beachfront resorts, hilltop vacation homes, wildlife jungle lodges and water amusement parks. It offers a mobile application and a Web portal for holiday reservation, payment transfer, customer grievance and membership data updating facilities.

Of particular interest to us, CCHHL owns 55 vacation membership clubs and resorts across India, West Asia, Far East and Sri Lanka.

Whew!

This is important to know because it is also a publicly traded company on the Bombay Stock Exchange (BSE), and it has decided to sell some of its assets in a bid to cut debt.

How much debt? I don’t know. What assets are they going to sell? I don’t know. I only know that “Country Club Hospitality & Holidays’ board has approved to sell, liquidate, transfer or lease back or dispose such assets which add limited value to the operations and profitability of the company, for the purpose of debt reduction.” And that their stock jumped 8.74% to Rs 13.81 on the news, rising 10.24% in two sessions from its close of Rs 12.70 on 27 June 2017.

As recently as May 2017 the company was planning to expand its network through hybrid franchisee model. Under this model, CCHHL would fund youngsters, who have experience in the holiday sector, to set up shop for selling Country Club’s holiday products.

So I’m guessing that the sell-off of assets doesn’t include their timeshare clubs. Ya think?

According to All India Resort Development Association (AIRDA), the sector in India has been growing at 7% y-o-y over the last five years as Indians still take fewer vacation compared to other countries.

It’ll be interesting to watch this, I think.



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2 comments

  1. Sidharath Bhalla

    In my opinion, in the Indian Timeshare business only two Companies are worth the mention – Mahindra Holidays & Resorts India Ltd. and Sterling Holidays & Resorts.

    MHRIL is the market leader who has made it’s own investment in the resorts across the country and overseas. Sterling has cleared it’s debt and is controlled by professional managers who have started investing in refurbishing their resorts.

    Rest all the Organizations or mom and pop shops intent is to woo the customer and in some cases provide the first holiday thereafter not intending to service the customer. Country Club India Ltd. is no exception to it. Of course the Top Management in CCIL has a strong political clout in India and hence able to pull it through.

    It is not that the Indian consumer does not wish to travel. The industry has not grown in India because of unscrupulous trade practices and intend to dupe the consumer.

    Most of these Companies do not own or have made any investments in the hotels or resorts. They lease 3-4 rooms for a year or longer period of time and showcase the same in publicity material or brochure. Even though there is a principal of Caveat Emptor in the India law which states that ‘Let the buyer beware’, the innocent customer gets mesmerized by the Sales talk of the Sales Executive and falls into the trap.

    It suits the Hotel owners and the occupancy of rooms is around average 25% to 30% and timeshare helps get upfront money per room. Since there is no regulator in the Industry servicing the customer gets a back seat by taking advantage of the clause “Subject to availability”. And if one asks for refund even during grade period or cooling off period, it is denied by these local players. Many consumers have filed complaints with the Economic wing and Crime Branch but in vain. It is quite common in India to bribe these enforcement agencies and suppress the legitimate right of the consumer.

    Seeing this potential, many ex-employees (at Sales Executive and Telemarketing level) have jumped into this business which needs minimal investment and a chance to loot and dupe the consumer. Since the population is large in India it is easy to woo the customers in tier 2 and tier 3 cities in India. Most of these players do not pay salaries of employees on time. In case an employee quits the settlement is seldom done which is another medium of make money taking advantage of the unemployment and under employment situation in India.

    The first question which the consumer must ask any Timeshare Company is how many resorts or hotels does it own where it has made it’s own investment.

    In India we need a regulatory authority who controls the industry and works in the interest of the consumer. The penetration of timeshare in India is currently hovering at 3-4 % and there is a huge potential in this industry.

    Also, major players have either not smelled profit in this business in India or do not wish to enter the country.




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    1. gatekeeper

      Thank you for this intriguing run down on the timeshare industry in India. I admit to not knowing nearly enough about it, so I appreciate the knowledge you shared.




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