HVS Monday Musings: Hotel Transactions in India in 2020

By Akash Datta and Dipti Mohan
2020 was a challenging year for hotel transactions in India, with hotel transactions value in the country contracting by approx. 50% compared to the previous year. The uncertain market conditions and COVID-19 related restrictions suppressed M&A activity during the year as companies adopted a wait-and-watch policy.

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Resorts World Genting Invests More Than USD800 Million in New Theme Park

Malaysia-based Genting Malaysia Bhd (“Genting Malaysia”) has announced that the USD800 million outdoor theme park, Genting SkyWorlds (“SkyWorlds”), is slated to open before mid-2021 at Resorts World Genting (“RWG”). Spanning across 10.5 hectares, 1,829 metres above sea level, SkyWorlds will feature 26 rides and attractions, and be able to accommodate approximately 20,000 tourists. Together with the original Intellectual Properties (“Ips”), SkyWorlds will also incorporate 20th Century Studios brands and IPs across its rides and attractions. These include Ice Age, Night at the Museum and Planet of the Apes among others. The park will also feature a variety of themed retail, dining, and entertainment experiences. Lee Thiam Kit, head of business operations and strategies, mentioned that SkyWorld will cater to families and all age groups. He also believes that the opening of SkyWorld will help boost Malaysia and Pahang’s tourism and economy going forward. While waiting for international borders to reopen, SkyWorld will be targeting domestic tourists. SkyWorld was scheduled to open in 2020 but construction was temporarily halted by Malaysia’s Movement Control Order. RWG, a property owned by Genting Malaysia, has resumed operations on 16 February 2021 after the easing of movement restrictions over the past weeks.

Bali Will be The First to Open for Tourism with New ‘Green Zones’

With the recent decline in COVID-19 cases in recent weeks, Bali is planning to open up to mass tourism. Bali’s Governor, Wayan Koster, has stated that Bali is setting up the ‘Green Zones’ for the reopening. The green zones are COVID-free zones and places where both “domestic and foreign tourists will be allowed to (safely) visit”, said Koster during a virtual press conference on the Indonesian Health Ministry’s YouTube channel. Given the decreasing number of active COVID-19 cases, the Coordinating Minister of Maritime Affairs and Investment, Luhut Pandjaitan, is optimistic about reopening Bali’s borders. Nevertheless, Pandjaitan has emphasised the consequences for those found violating the safety protocols. Sandiaga Uno, the Tourism and Creative Economy Minister, has also revealed the potential locations that may be sanctioned as green zones, including Kuta, Nusa Dua, Ubud, Sanur and Nusa Penida. Meanwhile, Bali has already begun their vaccination programme with more than 13,000 medical workers vaccinated. The government is aiming to vaccinate 1.2 million workers as the island prepares for its reopening.

Taiwan to Reopen for Business Travel to Selected Countries on 1 March 2021

On 24 February 2021, Health Minister and Head of Taiwan’s Central Epidemic Command Center (“CECC”), Mr Chen Shih Chung, announced that business travellers from countries classified as low to medium risk would be authorised to enter the country with the option of shorter quarantines. The CECC has categorised Bhutan, Brunei, East Timor, Fiji, Laos, Macau, the Marshall Islands, Mauritius, Nauru, New Zealand, and Palau as low-risk countries, where the quarantine period for business travellers have been reduced from two weeks to five days. Meanwhile, Australia, Cambodia, Singapore, and Vietnam have been listed as medium-risk locations, with a shortened quarantine period of seven days. Business travellers are required to prepare and submit their supporting documents detailing their purpose of visit, agenda of business activities, schedules, and epidemic prevention plans prior to their departure. Upon their arrival, these travellers are required to undergo a polymerase chain reaction test on the final day of the designated quarantine period. A negative test result allows travellers to undergo “enhanced self-health management” until the 14th day after arrival. The enhanced self-health arrangement requires business activities to be kept at a minimum.

Hong Kong Introduces HKD934 Million Tourism Stimulus

On 24 February 2021, the Hong Kong government announced in the 2021-22 budget that HKD934 million will be allocated to boost the tourism sector. Out of which, HKD169 million will be designated to promote local cultural, heritage and creative tourism projects while HKD765 million will be set aside for the Hong Kong Tourism Board (“HKTB”) to roll out promotional offers post Covid-19. Dr YK Pang, Chairman of the HKTB mentioned that the HKTB has formulated short, and medium-to-long term strategies for the funding to maintain Hong Kong’s tourism competitiveness post pandemic. Short term strategies include boosting domestic consumption to support local trade and organise large scale marketing and promotions to drive tourism recovery after international travel resumes. In the medium-to-long-term, HKTB aims to reinvent Hong Kong’s tourism image to capture high-yield visitor segments. Currently, the HKTB has been working towards enhancing subsidy schemes, sponsoring participation in trade events, organising large scale events to maintain Hong Kong’s international exposure. Apart from the HKD934 million budget, the government will also be handing out HKD5,000 e-coupons to eligible residents to fuel consumption.

Absolute Share Price Performance, as on 5 March 2021