Tourism Government of Gujarat - Development of - iNDEXTb

 
Tourism Government of Gujarat - Development of - iNDEXTb
Development of
5 star beach resorts

Tourism
Government of Gujarat
Tourism Government of Gujarat - Development of - iNDEXTb
Contents

   Project Concept                                 3
   Market Potential                                4
   Growth Drivers                                  5
   Gujarat – Competitive Advantage                 6
   Project Information                             12
     - Location/ Size
     - Key Players/ Machinery Suppliers
     - Infrastructure Availability/ Connectivity
     - Raw Material/ Manpower
     - Key Considerations
   Project Financials                              16
   Approvals & Incentives                          18
   Key Department Contacts                         20

Page 2
Tourism Government of Gujarat - Development of - iNDEXTb
Project Concept

   Indian hotel industry
    The Indian hotel industry is expected to
     reach US$1.8 billion by 2016, driven by an
     increase in online bookings. The industry is       Classification of hotels
     closely linked to the tourism industry and is
     a major driving force behind the growth of
     the services sector in India
    Tourism infrastructure includes hotels and                Star category               Heritage
     resorts, tourist amenities (cloak room,                      hotels                category hotels
     changing rooms, crèche, spa, wayside
     amenities), boarding and allied facilities               One star                   Heritage Grand
     (multi-cuisine restaurants, bars, specialty              Two star                   Heritage
     restaurants) and transport facilities (tourists          Three star                  Classic
     buses, boats, battery operated vehicles,                 Four star                  Heritage Basic
     ropeways, porter services)                               Five star
    The Indian hotel industry is highly
     fragmented with a large number of small
     and unorganized players accounting for the
     majority share
  Tourism activities in India
      Religious and spiritual
                                         Religious places, meditation centres
           experiences

         Natural experiences             Beach tourism, wild life excursions, hill stations

          Built environment              Fairs and festivals, art and craft

         Cultural experiences            Archaeological remains, heritage monuments

                                         Advanced health care systems, traditional healing
           Medical tourism
                                         services

   Top 5 hotel brands in India by existing inventory
                                 Number of rooms* (August 2015)
Taj Hotels, Resorts & Palaces (includes Ginger)                                                    13,250
                   ITC Hotels (includes Fortune)                                       9,000
                   Carlson Rezidor Hotel Group                                         8,900
                             Marriott International                               8,000
                       Starwood Hotels & Resorts                               7,000
Source: HVS Research

Page 3
Tourism Government of Gujarat - Development of - iNDEXTb
Market Potential

              Indian tourism and hospitality industry
                     The Indian tourism and hospitality industry contributed ~US$187.9 billion or 12.5% to the
                      country’s GDP in FY15, growing at a CAGR of 11.7% from FY12-FY15
                     The industry is expected to employ 13.5 million people across sub-segments such as
                      restaurants (10.5 million), hotels (2.3 million) and travel agents/tour operators (0.7 million)
                     According to HVS, the average rate and occupancy rate in the Indian hotel industry improved
                      in FY15
                     The average rate of hotels in India increased slightly to INR4,789 in FY15 from INR4,729 in
                      FY14. Hotel occupancy also increased after two years of stagnation to 61.3% in FY15

                                                    Occupancy and average rate
                                                                                                4,789
 Average rate (INR)

                              5000       4,578        4,677        4,507         4,729                     70%

                                                                                                                      Occupancy rate
                              4000                                                                         65%

                              3000       62.1%                                                             60%
                                                      60.9%        60.4%         60.4%          61.3%
                              2000                                                                         55%

                              1000                                                                         50%
                                         FY11        FY12          FY13          FY14       FY15
Source: HVS                              Average rate (INR)                      Occupancy rate (%)

                     In the Indian hotel industry, the contribution of        On a per available room basis, both
                      revenue from rooms has declined from 57.2% in             revenue as well as net income has
                      FY11 to 50.9% in FY15, while contribution from            increased since FY11
                      F&B increased from 36.6% in FY11 to 42.6% in             However, there is a declining trend in
                      FY15                                                      net income ratio from 32.4% in FY11 to
                                  Sources of revenue (%
                                                                                28.9% in FY15
                               contribution to total revenue)
                                                                                 Revenue and net income (per
               6.2%            6.5%       6.6%       6.9%        6.6%              available room in `000s)

          36.6%               38.3%                                                                      2,010    2,108
                                         41.2%       41.9%      42.6%                 1,861     1,864
                                                                           1,746

          57.2%               55.2%      52.2%       51.3%      50.9%           523       566      585      559      604

               FY11           FY12        FY13       FY14        FY15       FY11       FY12      FY13     FY14     FY15

                          Rooms        F&B* and banquets       Others                           Revenue
                                                                                                Net income
       Source: HVS                                                          Source: HVS

Page 4
Growth Drivers

                       Rise in foreign tourist arrivals (FTAs) and tourist movement within the
                        country has driven growth in the hospitality industry. The number of
                        FTAs reached 7.4 million in 2014, up 27.6% from 2010
  Increase in          India is known as a destination for spiritual tourism and also offers
    tourist             cruises, adventure, medical, wellness, sports, film, rural and religious
  movement              tourism. Medical tourists inflow is estimated to be 320 million in 2015,
                        up from 85 million in 2012
                       Travel and tourism is the third largest forex earner for India, which
                        contributed US$19.7 billion in 2014
                       Campaigns such as Khushboo Gujarat Ki, Incredible India, Athithi Devo
                        Bhava launched to harness the tourism industry’s potential
                       FDI under the automatic route in tourism and hospitality is allowed up
                        to 100%, subject to applicable regulations and laws
    Policy
                       Capital subsidy programme for budget hotels
   support
                       Introduction of ‘Medical Visa’ for tourists coming into the country for
                        medical treatment
                       Exemption of Fringe Benefit Tax on crèches, employee sports and
                        guest house facilities

                       The GoI has made efforts to improve and upgrade infrastructure
                        facilities at important tourist destinations, thereby, improving
   Improved             accessibility
 infrastructur         FY16 Union Budget allocated INR14.8 billion toward infrastructure
       e                development for destination and circuits, domestic / overseas
                        promotion and publicity

  Trends in Indian hotel industry
                       There is a rise in the concept of budget/no frill hotels which offer smart
   Emerging             basic services at an affordable price
 budget hotels         Examples include Ginger, Lemon Tree and Red Fox Hotels

                       Online and mobile based booking is picking up in hotel industry with
 Apps for web           the emergence of companies such as Make My Trip, Yatra, Cleartrip,
  and mobile            Goibibo and ixigo
    based              It is estimated that ~8.4 million Indians will book hotels online by 2016,
   booking              up from 3.5 million in 2014

                       There are sites that compare the results from all these sites to provide
    Growing             cheapest booking options to the customers
aggregators sites      Examples include Trivago and OYO Rooms

Page 5
Gujarat - Competitive
Advantage
 Mapping Gujarat Tourism
                        Somnath              Dwarka                  Palitana
         Religious      Temple,              Temple,                 Jain              Ambaji
           Sites        Junagadh             Jamnagar                Temple            Temple

                                                                                    Kevadia
      Beaches/          Mandvi            Chorwad                                   Colony
                                                                Dumas
     Water Bodies

                        Gir             Ratanmahal               Ran of            Nal
     Forest, wildlife                   Dahod                    Kutch             Sarovar
     & Ecosystems

                        Pavagadh
     Archaeologica      Archaeologica            Lothal              Dholavira
         l Sites        l Park

                        Modhera               Adalaj               Rani ki
     Heritage and       Sun                   Step well            Vav                 Idar
     Architectural      Temple

     Key initiatives to promote Gujarat tourism by the Government
     Tourism policy announced by the Government in 2015 provides many incentives to boost
      tourism in Gujarat. Investment in Gujarat’s tourism sector is expected to grow five-fold from
      INR54 billion (US$0.8 billion) to INR269 billion (US$4 billion) during 2014–2025
     Eight tourism hubs have been created for the convenience of tourists visiting Gujarat. These
      are in Ahmedabad metro, Ahmedabad (north Gujarat), Surat (south Gujarat), Vadodara (central
      Gujarat), Rajkot, Junagadh, Jamnagar (Saurashtra) and Bhuj (Kutch)
     Gujarat Infrastructure Development Board has prepared concession agreement model under
      PPP for the development of tourism sector projects in Gujarat
     The state government has implemented Panchavati Yojana, with the objective of providing
      facilities for recreation in villages and encouraging environment friendly activities to develop
      natural sites with tourism potential
     Emerging areas in Gujarat’s tourism industry are spiritual tourism, heritage tourism, cultural
      tourism, event based tourism, water and adventure sports, nature tourism, cruises, theme
      parks, convention centres for meetings and conferences

Page 6
Gujarat - Competitive
Advantage
     Availability of skilled resources
     Tourism policy announced by the Government in 2015 provides many incentives to boost
      tourism in Gujarat. Investment in Gujarat’s tourism sector is expected to grow five-fold from
      INR54 billion (US$0.8 billion) to INR269 billion (US$4 billion) during 2014–2025
     Eight tourism hubs have been created for the convenience of tourists visiting Gujarat. These
      are in Ahmedabad metro, Ahmedabad (north Gujarat), Surat (south Gujarat), Vadodara (central
      Gujarat), Rajkot, Junagadh, Jamnagar (Saurashtra) and Bhuj (Kutch)
     Gujarat Infrastructure Development Board has prepared concession agreement model under
      PPP for the development of tourism sector projects in Gujarat
     The state government has implemented Panchavati Yojana, with the objective of providing
      facilities for recreation in villages and encouraging environment friendly activities to develop
      natural sites with tourism potential
     Emerging areas in Gujarat’s tourism industry are spiritual tourism, heritage tourism, cultural
      tourism, event based tourism, water and adventure sports, nature tourism, cruises, theme
      parks, convention centres for meetings and conferences

 Gujarat stands at an excellent business opportunity for domestic and
 international tourists
    As per HVS State Ranking Survey 2015 of Hospitality Industry, Gujarat stands fifth among the
     Indian states, scoring high in the ease of doing business, Gross State Domestic Product (GSDP)
     per capita and intangible parameters
          The supply of branded hotel rooms in India reached 107,132 in FY15, up 3.2% from FY14.
             The number of branded hotel rooms in Gujarat reached 5,727, which translates to 2.92
             branded rooms/100km2
          Total number of hotel rooms in Gujarat were 79,000 in FY13
    During FY16, the overall room occupancy in Gujarat was 46.3%, with occupancy at business,
     spiritual and leisure destinations amounting to 56.8%, 38.3% and 48.9%, respectively
    The gross tourist flow in Gujarat reached 38.3 million in FY16, growing at a CAGR of 14.1% over
     the period FY11-FY16
    Ahmedabad, Ambaji, Dwarka, Surat and Vadodara accounted for ~42% of gross tourist flow to
     Gujarat in FY16
    Tourist flow to Gujarat in FY16 was driven by business purpose (56%), followed by religion (35%),
     leisure (7%) and other purpose (2%)

Page 7
Gujarat - Competitive
Advantage
    Beach tourism in Gujarat
   Gujarat is geographically well-located with a long coastline (1660 km) and a multitude of
    beaches. These beaches are the finest in India and attract a huge number of tourists every year.
    The pristine waters, soft sands and, rich flora and fauna are their main attractions
   The Government of Gujarat introduced a new tourism policy in 2015 and gave industry status to
    the tourism sector to attract investments for building tourism infrastructure
            The policy also focuses on developing infrastructure for cruise tourism and beach tourism
             on coastal areas under PPP model
   Gujarat organized the Gujarat Beach Festival for the first time in 2016 in order to attract more
    tourists. The festival was hosted by five famous beaches of Gujarat namely Mandvi, Veraval,
    Tithal, Madhavpur and Shivrajpur

    Popular beaches in Gujarat

                       Mandvi

                Bet Dwarka

         Shivrajpur               Poshitra
            Dwarka
                                                           Ghogha
                   Miyani                                   Kuda
                         Odedar
                                                          Katpar           Ubhrat
                          Madhavpur
                                                 Sarkeshwar                     Dandi
                                  Ahmedpur                             Tithal
                                   Mandvi
                                                                   Nargol
                                                              Umbergaon

Source: Gujarat tourism website

Page 8
Gujarat - Competitive
Advantage
 Gujarat stands at an excellent business opportunity for domestic and
 international tourists

               Domestic Tourists (in lakhs)                               International Tourists (in lakhs)

                    CAGR:                     1,233                                                             22
                                                                                           CAGR:
                    14.1%                                                                  13.2%

                                637                                                                  12
                   376                                                                 7
       194                                                            4

      FY11         FY16        FY20E          FY25E               FY11            FY16             FY20E      FY25E

                             Source: Tourist Flow Information System- Annual Report 2015-16
    The total flow of tourist is expected to record an increase over the years
    This is attributed to the growing prominence of the state as a major business hub.

 Total contribution to GDP                 Total Investment (USD billion)                     Employment (in million)

          CAGR:                                     CAGR:
                     5.0%                                                                                     3.00
          5.76%                                     11.0%      4.00                                  CAGR:
                                                                                                     15.63%

      2.7%

                                                                                              0.95
                                            0.81

      2014          2025P                   2014              2025P                           2014            2025P

                                Source: Tourism Policy for state of Gujarat(2015-20)

    Tourism in India accounts for 7.5% of the GDP and is the third largest foreign exchange earner
     for the country. Gujarat is expected to contribute 5% to the total GDP by 2025.
    The business is expanding both in terms of turnover and boundaries and therefore
     contributions total investments by Gujarat are expected to increase.
    Today worldwide, one in eleven jobs may be ascribed to the tourism industry. Gujarat is
     expected to generate 3 million jobs by 2025.

Page 9
Gujarat - Competitive
Advantage
   5 Star hotels approved in Gujarat by Ministry of Tourism, India
 Hotel name                      City                 Valid from               Valid to                   Rooms
 The Gateway Hotel               Surat                11 April 2012            10 April 2017              206

 Welcom Hotel Vadodara           Vadodara             28 December 2011 27 December 2016                   133

 The Pride Hotel,                Ahmedabad            19 December 2011 18 December 2016                   110

 Hampton by Hilton               Puri                 13 May 2013              12 May 2018                58
 The Gateway Hotel               Vadodara             20 June 2013             19 June 2018               86
 The Fern Gir Forest             Junagadh             13 May 2013              12 May 2018                40
 Resort

 St. Laurn Towers                Ahmedabad            19 November 2014 18 November 2019                   129

 Hotel Novotel                   Ahmedabad            27 October 2014          26 October 2019            184

 The Fern, Ahmedabad             Ahmedabad            09 January 2015          08 January 2020            20

 Fortune Landmark                Ahmedabad            09 January 2015          08 January 2020            95
 Total                                                                                                  1,061
Source: Ministry of Tourism, Government of India

   5 Star Deluxe hotels approved in Gujarat Ministry of Tourism, India
  Hotel name                            City           Valid from                Valid to                 Rooms

  The Grand Bhagwati                    Surat          03 June 2013              02 June 2018             170

Source: Ministry of Tourism, Government of India

   Rooms available within Gujarat as of FY11*
                                   3-5 Star category           Other Star category              Un-classified
  District
                                   hotels                      hotels                           hotels
  Jamnagar                         425                         964                                  2,648
  Surat                            1,657                       1,305                                2,108
  Valsad                           245                         605                                  1,505
Source: GITCO analysis, TFIS FY11

*For Shivrajpur, Dandi and Umbergaon, nearest major city’s information is provided. Shivrajpur – Jamnagar, Dandi –
Surat, Umbergaon – Valsad

Page 10
Project Information

    Potential destinations

          Dwarka                   Shivrajpur

               Surat                      Dandi

                                                                                                  Tourist
                                                                                                   flow*
                       Valsad                 Umbergaon

                                                                                      Tourist flow (in ‘000s)
                          Located at a distance of nearly 10 km                                                  8,034
                          from Dwarka, Shivrajpur beach makes
  Shivrajpur                                                                                            3,978
                          an ideal holiday destination for
    beach                                                                       847    1,436 2,267
                          travellers with its picturesque view, blue
                          water and fine white sands
                                                                                FY      FY       FY   FY    FY
                                                                               2009    2012     2016 2020E 2025E

                          Located very close to the Dandi village                                                9,593
                          is the beautiful Dandi beach. It is a
                          huge beach and is known for its historic
                                                                                                        4,197
                          significance. The historic Salt March
 Dandi beach              was led by Mahatma Gandhi in the                             1,411 2,166
                                                                               681
                          year 1930 at this place. The natural
                          beauty of the place attracts huge                    FY       FY       FY   FY    FY
                          amount of tourists                                  2009     2012     2016 2020E 2025E

                          Umbergaon is a village located in the
                          Valsad district of Gujarat state near to
 Umbergaon                the border of Maharashtra state. The                                                  3,034
                          serene beach attracts many tourists                                  668    1,309
   beach                                                                     206      259
                          from both Maharashtra and Gujarat for
                          its calmness and peacefulness                       FY       FY      FY   FY    FY
                                                                             2009     2012    2016 2020E 2025E
* For Shivrajpur, Dandi and Umbergaon, nearest major tourist destination’s tourist flow has been provided
Source: TFIS Annual report FY16

Page 11
Project Information

    Potential destinations*

                                                Shivrajpur beach

     Top hotels                   Rentals (INR)*
Dwarkadhish Lords Eco
                                        3,046
         Inn
 Goverdhan Greens
                                        2,539
       Resort
     Hotel Gomti                        1,944
 Hotel Shree Darshan                    1,469
    Hotel Dwarka
                                        1,124
      Residency

                                                   Dandi beach

                                                                       Top hotels                Rentals (INR)*
                                                                   The Gateway Hotel
                                                                                                       5,711
                                                                      Athwa Lines
                                                                   Best Western Yuvraj                 2,599

                                                                   The Grand Bhagwati                  4,588

                                                                   Hotel Ginger Surat                  2,978

                                                                   Lords Plaza - Surat                 4,150

                                              Umbergaon beach

       Top hotels                 Rentals (INR)*

 The Umbergaon Club                     5,108

   AXN Resort & Spa                      NA
Hotel Grandeur & Vista
                                        2,474
       Rooms
       Hotel Orizon                      NA

      Srilekha Hotel                     NA
* For Shivrajpur, Dandi and Umbergaon, nearest major city’s hotel information is provided. Shivrajpur – Dwarka, Dandi –
Surat and Umbergaon - Valsad
Source: Hotel and rentals taken from Tripadvisor on 28 July 2016

Page 12
Project Information

  Infrastructure availability - logistics & connectivity
                           Dwarka                                Surat                              Valsad
                    Dwarka is a station on          Surat is well connected with             Valsad has a
                     the Ahmedabad-Okha               Valsad, Vapi and Mumbai                   major railway
                     railway line, with trains        towards its south and with                station where
                     connecting it to                 Bharuch, Vadodara and                     almost all the
                     Jamnagar (137 km),               Ahmedabad in the north                    major trains
   Rail              Rajkot (217 km) and             Hazira port in Surat is ~16 km            stops
                     Ahmedabad (471 km)               away from the Surat railway
                                                      station

                    Dwarka is on the state          Proximity to NH-8 and NH-6               Valsad is located
                     highway from                     further enhances                          on National
                     Jamnagar to Dwarka.              connectivity in the city                  Highway
                     Direct buses are                                                           connecting Surat
                                                     Surat also has very good
                     available from                                                             to Mumbai. Valsad
                                                      connectivity with Vadodara
  Road               Jamnagar and                                                               is 200 km from
                                                      (154 km) and Ahmedabad
                     Ahmedabad                                                                  Mumbai and 100
                                                      (265 km)
                                                                                                km from Surat

                    Nearest airport is               Surat has a domestic                    Nearest airport is
                     Jamnagar (137 km),                airport which is well                    Surat with daily
                     where regular buses               connected to different                   flights to Delhi,
                     and taxies are                    metros. It has daily flights             Jaipur, and
   Air                                                                                          Ahmedabad
                     available for travel              to Delhi, Jaipur, and
                     to Dwarka                         Ahmedabad

                                                      Magdalla and Hazira Ports               Nearest seaport is
                     Nearest port from
                                                       in Surat have good rail and              at Surat- Hazira;
                      Dwarka is Okha
                                                       road connectivity                        and two new ports
                      port, which is at a
                                                      Magdalla port is 2 Km                    are proposed at
                      distance of about 30
                                                       away from the state                      Nargol (60 km
  Port                km
                                                       highway and 15 Km away                   from Valsad) and
                                                       from NH-8                                at Vansi Borsi (100
                                                                                                km from Valsad)
* For Shivrajpur, Dandi and Umbergaon, nearest major city’s connectivity is provided. Shivrajpur – Dwarka, Dandi – Surat
and Umbergaon – Valsad

Page 13
Project Information

Estimated manpower requirement in potential locations
 Designation            Shivrajpur (15 rooms) Dandi (30 rooms)                 Umbergaon (20 rooms)
 Manager                2                        3                             2
 Attendants             17                       33                            22
 Sweepers               8                        17                            11
 Security guard         7                        14                            9
 Cook                   2                        5                             3
 Helpers for kitchen    2                        5                             3
 Total                  38                       75                            50

Project components
                                                                                Shower/ changing
          Cottage                          Swimming pool
                                                                                     room
 Massage and treatment
                                       Sauna and steam bath                         Fitness room
        rooms
                                       Recreation room with
Yoga and meditation hall                                                            Restaurant
                                       indoor gaming facility
                                                                             Open and landscaped
          Kitchen                       Staff accommodation
                                                                                    area
 Project Structure & Implementation Model
The project is to be completed and funded through a PPP model on BOT basis (Build, Operate and
Transfer), DBFOT (Design, Build, Finance, Operate and Transfer), Operate and Maintain (O&M),
Direct private sector investment
   Government releases an RFP to the empanelled list of consultants for Project Consultant role

                                    Government authority

    Government selects the private player
   through competitive bidding process and
                                                                    SPV
   enters into an agreement to form an SPV

                                       Private investor
                                     (project developer)

      The developer will create suitable facilities at the site mentioned considering site specific
                                 environmental and relevant factors

Page 14
Key Considerations

   Key points to consider while developing beach resorts

                                    Gujarat would become the state which would
                                     uphold, host and develop various eco,
                                     adventure sports and water sports initiatives
           Government               It is said to become one of the major tourists
            Initiatives              attractions and place Gujarat ion the global
                                     map with Adventure and Sports Tourism with
                                     Proactive Governance promoting the growth
                                     of the Sector

                                    The site could be promoted together with
                                     other water sports like surfing, jet skiing,
                                     kayaking or swimming, where the beaches
                                     of Gujarat would serve as the perfect
      Promotion of water             location for different water activities
      sports on the beach           Integrated development of Tourism
                                     infrastructure facilities is also being
                                     materialized

                                    Coastal erosion is a major problem in
                                     Gujarat. Erosion reduces the water
                                     availability in coastal aquifers and increases
                                     the salinity intrusion
          Coastal erosion
                                    Coastal communities in Gujarat migrate to
                                     other locations due to environmental
                                     degradation, which results in manpower
                                     shortage in beach resorts

Page 15
Project Financials

                                         Project location area
Component                                                   Area (sq mt)
Location                    Shivrajpur (15 rooms) Dandi (30 rooms)              Umbergaon (20 rooms)
Site area                   4,000                   30,000                      20,000
Resort area (@150 sq
                            2,250                   4,500                       3,000
mt per room)
Tourist amenities
                            500                     1,500                       1,000
complex
Parking space               1,150                   9,200                       6,900
Circulation space           100                     8,250                       5,500
Total area utilized         4,000                   23,450                      16,400
Area for future expansion 0                         6,550                       3,600
                                          Total capital cost
 Component                                           Total cost (INR million)
 Location                   Shivrajpur              Dandi                       Umbergaon
 Levelling of the site      3.7                     27.7                        18.4

 PCC base                   0.1                     1.0                         0.7

 Horticulture               0.8                     5.8                         3.9

 Building construction      42.4                    84.7                        56.5

 Furniture and furnishing   1.8                     13.6                        9.0
 Machinery and              0.7                     5.0                         3.3
 equipment
 Lighting and electricals   1.1                     8.5                         5.7

 Total                      50.6                    146.3                       97.5

                                      Operation cost (per month)
 Component                                                 Total cost (INR)
 Location                   Shivrajpur              Dandi                       Umbergaon
 Staff cost                 453,375                 906,750                     604,500
 Power Cost                 50,625                  101,250                     67,500
 Diesel Cost                13,500                  27,000                      18,000
 Water supply               1,800                   3,600                       2,400
 Maintenance
                            17,654                  35,307                      23,538
 expenditure
 Net Expenditure            536,954                 1,073,907                   715,938

Page 16
Project Financials

                                  Total project cost and revenue
 Costing                                               Total cost (INR million)
 Location                        Shivrajpur            Dandi                    Umbergaon
 Base construction cost (INR
                                 50.6                  146.3                    97.5
 million)
 Pre-operative expenses (INR
                                 1.5                   11.2                     7.5
 million)
 Interest during construction
                                 1.7                   4.9                      3.3
 (INR million)
 Landed project cost (INR
                                 53.8                  162.3                    108.2
 million)
                                      Terms of concession
 Construction period (Years)     1.0                1.0                         1.0
 Concession period (Years)       35.0               35.0                        35.0
 Upfront premium (INR million)   0.0                0.0                         0.0
 Annual premium (INR million)    0.3                1.0                         0.7
                                        Financing assumptions
 Debt (INR million)              26.9                  81.2                     54.1
 Equity (INR million)            26.9                  81.2                     54.1
 Rate of interest of debt        12.0%                 12.0%                    12.0%
                                        Demand assumptions
 Occupancy of resort for
                                 60 days in a year     60 days in a year        60 days in a year
 wedding
                                300 non-wedding
                                                     300 non-wedding days       300 non-wedding
                                days in a year,
                                                     in a year, occupancy       days in a year,
                                occupancy starting
                                                     starting from 30% in       occupancy starting
 Occupancy of resort (non-      from 30% in the
                                                     the first year,            from 30% in the first
 wedding days)                  first year,
                                                     increasing at 3% per       year, increasing at
                                increasing at 3%
                                                     annum, stabilizes at       3% per annum,
                                per annum,
                                                     60%                        stabilizes at 60%
                                stabilizes at 60%
                                       Revenue assumptions
                                INR75,000 per        INR150,000 per             INR100,000 per
 Revenue from rental for
                                function, increasing function, increasing at    function, increasing
 destination wedding
                                at 5% per annum      5% per annum               at 5% per annum
                                INR5000/Day          INR6000/Day                INR6000/Day
 Revenue from booking of resort increasing at 5%     increasing at 5% per       increasing at 5% per
                                per annum            annum                      annum
                                INR500/day (when INR500/day (when a             INR500/day (when a
 Revenue from food and          a room is booked). room is booked). 50%         room is booked).
 beverages (F&B) at resort      50% of this would    of this would be cost of   50% of this would
                                be cost of F&B       F&B                        be cost of F&B
 IRR                             17.1%                 14.6%                    12.2%

Page 17
Approvals and
Incentives
 Approvals required

    Coastal Regulation Zone (CRZ) approval
    Local body clearances
    Acquisition of land from concerned office /owner
    No objection certificate from Gujarat Pollution Control Board
    Environmental clearance from Ministry of Environment and Forest and Government of Gujarat
     (State Impact Assessment Committee)
    Arrangement of power with zonal distribution company
    Arrangement of water with concerned municipal corporations
    Any other clearances required

 Incentives from Government of Gujarat

 Government of Gujarat has granted Industry status to Tourism sector thereby providing a great
 boost to the industry. The incentives under Tourism Policy for the State of Gujarat (2015-2020)
 shall be applicable to the eligible tourism units as mentioned in the next sections.

 Capital Subsidy to the Eligible Tourism Units
 Eligible Capital Investment (excluding land cost)            Admissible    Maximum limit
                                                              subsidy

 Investment upto INR500 million                               15%           INR75 million
 Investment above INR500 million                              15%           INR100 million
 Tented accommodation (with minimum investment of
                                                              20%           INR1.5 million
 INR2 million)

 Equipment worth INR10 million and above for adventure
                                                              10%           INR5 million
 & water sports

 Additional Capital Subsidy of 5% for New Tourism Units
  Within the Corporation limits of Gandhinagar and falling within the radius of 20 kms.

  Owned and managed by women entrepreneurs (with minimum equity participation of 51% in

    the entity)
  SC/ST categories to an additional 5% subsidy over and above the ‘Admissible Subsidy’.

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Approvals and
Incentives
 Interest subsidy to the eligible tourism units
     @5% of the loan amount with maximum amount of INR2.5 million per annum for a period of
      five years in Municipal Corporation areas for eligible tourism units
     @7% of the loan amount with maximum amount of INR3.0 million per annum for a period of
      five years in the areas other than mentioned above.

 Other Exemptions
     Luxury Tax - 5 years from the date of commencement of commercial operation
     Entertainment Tax - 5 years from the date of commencement of commercial operation
     Electricity Duty - 5 years from the date of commencement of commercial operation for New
      Tourism Units only.
     100% reimbursement of stamp duty and registration fee on sale/lease/transfer of land for the
      first transaction only.

  Support for Sustainable Tourism
     Assistance to eligible tourism units up to 75% of the cost of carrying out Energy Audit by a
      recognized institution/consultant, Water Harvesting / Conservation and Environment-friendly
      practices like Green Buildings, Solar and other Renewable Energy measures

 Special Package for Mega Tourism Units
 The State Government shall duly promote and facilitate Mega Tourism Projects that have a large
 multiplier effect on the economy, leading to employment generation and inclusive growth in the
 State. Any type of Mega Tourism Units like Film City, theme parks, amusement parks, water
 parks, etc. meeting the qualifying criteria of Mega Tourism Units will be eligible.
 Following incentives would be offered to eligible Mega Tourism Units:
     100% reimbursement of stamp duty and registration fee on sale/lease/transfer of land for the
      first transaction only. Reimbursement of stamp duty and registration fee would be done after
      the commencement of commercial operations.
     Capital subsidy of 15% of eligible capital investment (excluding the cost of the land) subject to
      a ceiling of INR200 million.
     Exemption from luxury and entertainment tax for a period of seven years from the date of
      commencement of commercial operations.
     Exemption in electricity duty would be for a period of five years from the date of
      commencement of commercial operations.
     Mega tourism units shall not be entitled to any interest subsidy.

Page 19
Tourism Corporation of Gujarat Limited
                                       http://www.gujarattourism.com/

                                      Department of Tourism, Gujarat
                                       http://www.gujarattourism.com/

                               Industries and Mines Department, Gujarat
                                            www.imd-gujarat.gov.in/

                                 iNDEXTb - Industrial Extension Bureau
                                               www.indextb.com

This project profile is based on preliminary study to facilitate prospective entrepreneurs to assess a prima facie scope.
     It is, however, advisable to get a detailed feasibility study prepared before taking a final investment decision.

                                                               Tourism Corporation of Gujarat Ltd,
                                                               H. K. House, Opp: Bata Showroom,
                                                               Ashram Road, Ahmedabad,
                                                               Tel: +79 26578044/46/26589172
                                                               Fax: +79 26582183
                                                               E-mail: tibahd@gujarattourism.com
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