Nikhil KamathWhy A 25-Year-Old Should Build A Hotel, Not An App | MakeMyTrip x Taj | WTF is Travel?
EVERY SPOKEN WORD
150 min read · 30,152 words- 0:00 – 7:03
Introduction
- SPSpeaker
[clears throat] So this episode was a bit of an experiment for all of us.
- NKNikhil Kamath
We wanted to switch things up, but without messing the flow that you're used to.
- SPSpeaker
Usually, when a term or stat comes up in the episode, we break it down within the episode. This time we thought, why not just go find the stat instead?
- NKNikhil Kamath
So we sat down with a few founders in the travel space right now, got them talking about what worked, what didn't, what they would do differently.
- SPSpeaker
So we have kind of woven bits and pieces of it.
- SPSpeaker
So you guys have real context instead of just explaining things to you.
- SPSpeaker
But if you wanna dig deeper, get more insight on the data, the timestamps, the references, whatnot, all of it is going to be attached in a document below.
- SPSpeaker
So yeah, new format, new experiment.
- SPSpeaker
Uh, we hope you guys like it, and let us know if you do. It's okay if you don't also. It's fine. We don't need to know. It's okay. [upbeat music]
- NKNikhil Kamath
We have, like, three questions left.
- SPSpeaker
Okay.
- NKNikhil Kamath
Yeah. Okay, so I'm just gonna ask you, like, random questions to just, like, break the ice, let you feel more comfortable.
- RMRajesh Magow
Sure.
- NKNikhil Kamath
And then we'll get into it.
- RMRajesh Magow
Sorry, I was looking there.
- NKNikhil Kamath
Uh, open chat.
- SPSpeaker
Can't wait. I'm very curious.
- NKNikhil Kamath
So how would people describe you?
- RMRajesh Magow
Good question. I think maybe a simple, honest man. Passionate, perseverant, never ever give up.
- NKNikhil Kamath
And how long have you been in this industry?
- RMRajesh Magow
In this travel and tourism industry, about twenty-six years. Forty-five years, including hotel school.
- NKNikhil Kamath
If someone who's in their twenties and thirties, where would you tell them to travel?
- RMRajesh Magow
Travel wherever your heart and your wallet takes you, but don't stop traveling. Wow. [upbeat music]
- NKNikhil Kamath
Let's start with your stories.
- RMRajesh Magow
See, is this an interview?
- NKNikhil Kamath
Yeah.
- RMRajesh Magow
Very, very good.
- NKNikhil Kamath
And would you do it again?
- SPSpeaker
Oh, for sure.
- SPSpeaker
In terms of travel?
- 7:03 – 14:30
Getting to Know the Guests
- PCPuneet Chhatwal
You seem to have quite a name, huh?
- RMRajesh Magow
[chuckles] Nikhil?
- PCPuneet Chhatwal
Huh.
- RMRajesh Magow
Of course.
- PCPuneet Chhatwal
Bahut fabulous.
- NKNikhil Kamath
Mm.
- PCPuneet Chhatwal
Bahut, I lo-
- NKNikhil Kamath
How-
- PCPuneet Chhatwal
I, I'm sorry, I was not in the country, toh mereko itna maloom nahi hai
- RMRajesh Magow
That's what I was just telling him, and he's waiting for you to tell him more.
- PCPuneet Chhatwal
Toh isliye, but-
- NKNikhil Kamath
I hope good, not bad. [laughs]
- PCPuneet Chhatwal
Very good. They say, like-
- NKNikhil Kamath
It's a cycle
- PCPuneet Chhatwal
... you did things on your own, uh, but it was not like, like from day one you were cash positive or s- Ma- I mean, like, not like somebody-
- RMRajesh Magow
What a story Zerodha is. What a story.
- PCPuneet Chhatwal
Hai na?
- RMRajesh Magow
What a story.
- PCPuneet Chhatwal
Ye hamara CFO bol raha tha.
- RMRajesh Magow
Ha. [laughs] Because he must be playing on your platform. [laughs]
- PCPuneet Chhatwal
He s- he said, "Nahi, nahi, ye waisa wala nahi hai jo aap soch rahe ho." He's ... [laughs]
- NKNikhil Kamath
It's a cycle, no? Good, bad, good, bad. Hamara good chala hai, toh mathematically maybe it's a bad thing.
- PCPuneet Chhatwal
Sorry, he told me, our CFO told me what Groww is doing now is inspired from-
- RMRajesh Magow
Yeah
- PCPuneet Chhatwal
... what you have done.
- RMRajesh Magow
Yeah, they followed us.
- PCPuneet Chhatwal
Mm. Kamal, ya. And of course, he had told me everything, that you are the most famous Indian person who has, I don't know, done Elon Musk or whatever-
- RMRajesh Magow
We were just chatting about it and I'm saying, "Why don't you join?" So I sent him, he said, "You know, you tell me," and all.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
I sent him Elon Musk. [laughs] So-
- 14:30 – 21:45
How MakeMyTrip’s Hotel Partnerships Work
- RMRajesh Magow
I don't think you found anyone in the morning, no. It's not real.
- PCPuneet Chhatwal
But a real story, right?
- RMRajesh Magow
Uh, no, it's not real. [laughs]
- PCPuneet Chhatwal
They got us off the, off the stage.
- RMRajesh Magow
At least I didn't realize it was real. [laughs]
- NKNikhil Kamath
I thought a hotel will list on everything.
- RMRajesh Magow
No. We are on all.
- NKNikhil Kamath
Uh, then how does it matter?
- PCPuneet Chhatwal
It does matter because a lot of, uh, our offers are going through them. We have not done any special campaign with Booking.
- NKNikhil Kamath
So you're saying where-
- PCPuneet Chhatwal
Or with Expedia
- NKNikhil Kamath
... where you discount, people will take from there.
- PCPuneet Chhatwal
Not discount. Whatever kind of deal we do and special one.
- RMRajesh Magow
I, I guess it's also a function of, um, market focus and the power of the brand, right? You know, so let's say, you know, in comparison, if you look at any brand in any category, if you're looking at, uh, a particular online platform or brand which has built significant traffic and traction-
- NKNikhil Kamath
Mm-hmm
- RMRajesh Magow
... and the ROI spending or investing on that brand will be higher.
- NKNikhil Kamath
Right.
- RMRajesh Magow
So you end up just doing it there, relatively speaking. I'm just very dispassionately speaking. Otherwise, you're right. The inventory will be there, uh, theoretically speaking, everywhere.
- NKNikhil Kamath
And you go to Taj and crack these deals,
- RMRajesh Magow
It's actually much more than that. See, what happens in a close partnership, which Puneet was alluding to, is that both the respective teams actually almost thinking that this is our own channel. They start to look at lot of the data, and then based on that, react, right? Which is, like, almost day-to-day engagement. So there will be a tiny group on that side, there will be a tiny group on our side, working very closely hotel by hotel. Many examples, you know, let's say new property. We were just in the morning talking about a new hotel that has come up in Frankfurt, for example. So we were talking about how do we now get traction from MakeMyTrip for Frankfurt, right? For, and we were talking about international traffic growing in, in India. And then you start to figure out, because, see, we also on our platform and pretty much every e-commerce platform will have many properties that you would have built, right? Just to, to, you know, of course, from the demand side, you keep getting customers. And from a brand perspective that you have more than one product offering to offer. You know, including the brand store, including the, you know, uh, I guess maybe you were talking about sponsored listing versus non-sponsored listing-
- NKNikhil Kamath
Mm
- RMRajesh Magow
... et cetera.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
Of course, all of that comes with investment.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
But it's like a very sort of close, uh-
- NKNikhil Kamath
So they give a deal on MMT, in return for that you pay them money.
- RMRajesh Magow
No, we don't pay them money. No, that he was-
- PCPuneet Chhatwal
We pay them
- RMRajesh Magow
... half joking. [laughs]
- 21:45 – 28:26
Booking Direct vs Travel Apps
- RMRajesh Magow
I think I'll tell you what happens-
- NKNikhil Kamath
Right
- RMRajesh Magow
... maybe just building on that, right? So what happens, you're right.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
There will be section of people who would want to do it. We used to call it shopping, right?
- NKNikhil Kamath
Right.
- RMRajesh Magow
It happens again in every online category, that you will ... In the browser world, there used to be ... It was easy for you to flip from one browser to the second and a third browser.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
In the app world-
- NKNikhil Kamath
Because if you're on one browser, the history you guys get to see
- RMRajesh Magow
... one browser. Yes. Right. To the wider selection, to Puneet's point-
- NKNikhil Kamath
Mm
- RMRajesh Magow
... right? Because ... And not only that-
- NKNikhil Kamath
Is that still the case?
- RMRajesh Magow
It is.
- NKNikhil Kamath
Like, if I'm on Chrome and I'm scrolling and I've come to your website, I come back the second time around, the price would have changed.
- RMRajesh Magow
It could change. But it-
- NKNikhil Kamath
But this browser history is sh- shared by every browser?
- RMRajesh Magow
Not really. Not necessarily. By the way, in any case, the browser market has moved to app market now predominantly.
- NKNikhil Kamath
Right, right.
- RMRajesh Magow
So right now, volume-wise, overwhelming 75, 80% of the bookings will happen in the app.
- NKNikhil Kamath
Right.
- RMRajesh Magow
There, the switching is not easy.
- NKNikhil Kamath
You give incentive to download app.
- RMRajesh Magow
Real estate and download app.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
Absolutely. So that landscape has changed significantly. But that shopping behavior, the other reason why the shopping behavior also change, if you are a repeat buyer.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
And that is a function of what experience I have been giving it to you.
- NKNikhil Kamath
Mm.
- 28:26 – 35:01
Puneet Chhatwal’s Journey from Delhi to Europe
- NKNikhil Kamath
[laughs] I know you're also from Delhi.
- RMRajesh Magow
That's correct.
- NKNikhil Kamath
Ger- Germany foreign language.
- RMRajesh Magow
Europe foreign language. By the other time Germany.
- NKNikhil Kamath
Give us a little bit of a trajectory. Where did you ... You grew up in Delhi till what year?
- RMRajesh Magow
I was in Delhi more or less till the age of 25, and then spent the next 28 years in Europe.
- NKNikhil Kamath
So you started hotel management.
- RMRajesh Magow
Started hotel management.
- NKNikhil Kamath
Joined in the-
- RMRajesh Magow
'81-
- NKNikhil Kamath
Huh
- RMRajesh Magow
... to '84. '84 to '89, I started with the government, India Tourism Development Corporation.
- NKNikhil Kamath
Hmm.
- RMRajesh Magow
Most of the time I spent was at the Ashok Hotel, uh, Delhi.
- NKNikhil Kamath
Mm-hmm.
- RMRajesh Magow
In '89-
- NKNikhil Kamath
Hmm
- RMRajesh Magow
... I left.
- NKNikhil Kamath
Hmm.
- RMRajesh Magow
And I went to Paris for two years.
- NKNikhil Kamath
What were you doing in Paris?
- RMRajesh Magow
My master's. That time there was a program, which is still there.
- NKNikhil Kamath
Hmm.
- RMRajesh Magow
So it's a business school called ESSEC.
- NKNikhil Kamath
Okay.
- RMRajesh Magow
Uh, one of the five Grandes Écoles of France, which had a 50/50 tie-up with Cornell from US. So it was called Cornell-ESSEC.
- NKNikhil Kamath
Right.
- RMRajesh Magow
I did my master's there. And then went to Germany, worked in consulting, worked for what is today called Radisson Hotels worldwide for almost 15 years. And then went on to run a hotel company in Germany for five years, and then-
- NKNikhil Kamath
Beausché Hospitality.
- RMRajesh Magow
Beausché Hospitality. And then back to where it all started from.
- 35:01 – 41:43
Building Villa Stays & Solo Travel Businesses
- SPSpeaker
Indian market. People were not really staying at villas. Uh, villas as a concept was still very new. The people who might have stayed at these would have stayed abroad. Uh, but what we saw as an opportunity was that there were beautiful homes that people had made, but they weren't utilizing them. They needed a trusted partner who can take care of the entire hassle of hosting. That's where we come in for a homeowner. And then for a consumer, where the entire experience layer, where we offer an entire experience to a guest, whether it's, uh, housekeeping services, whether it's spa services, whether it's food, whether it's decor for a celebration, everything is taken care by us, so that when people come together and stay at our homes, they have a fab- fabulous time.
- SPSpeaker
So when I was working at IPlex, I was really happy. I was working as the head of operations, but there was something missing inside me. And one random day, I thought of taking a solo trip to Rishikesh, and, uh, it was back in 2022, wherein solo travel for a women used to be like a big thing. And I remember booking the bus and my mother crying that, "Dude, what is happening? Why are you going alone? We, you have us, you have your, you know, friends." But I was like, "I wanna do this." And I actually was supposed to go there for three days, but I spent two weeks there, hitchhiked, traveled solo, explored hostels. And when I came back, I realized solo travel is so liberating. Like, you can do whatever you wanna do, because when you're with your friends, when you're with your family, you have to also make sure that you are understand- you want, you know, you're also accommodating their needs. But when you are solo, you can do whatever you want to do. And then my co-founder was also working in the same organization, and I pushed him to go to Bali, take a solo trip. He came back, and he had the same reaction, that, "Bhavika-
- SPSpeaker
I am not traveling with anyone. I am, or I'm gonna travel solo because it was so, so liberating, and I could feel the freedom. And then both of us, uh, also took certain community trips wherein there was no filtration. Like, we were in our 20-- we were, we are in our 20s, and there were people in their 40s. And of course, our problems and our things of discussion were different, and their things of discussion were different. And, uh, there was no ratio control. And even though the concept was great, we were not coming back with the right sort of people, and that's when we, you know, decided to start with something like Boketto, which is an invite-only company. So anybody who wants to join us, they have to request an invite, mention their age, their city, what do they do, and why do they wanna travel with us. And then we get on a call with them to understand more, and then we try to just have people. You know, we just try to find common thread between all the people who are joining us. Um, and that is one of the major reasons, uh, a lot of people have found their soulmates out of Boketto. We've covered all of that. People have found their business partners, people have found their best of friends out of Boketto. So that is, um, how Boketto came into place, and that is how, you know, we-- that was the idea behind it, that we just wanted to make the right sort of people come together and have a great time all together.
- SPSpeaker
So, um, my co-founder is, um, was a senior trekker, was an experienced trekker. Uh, me on my, uh, on the other side, uh, I was working in the corporate. I was a software engineer. I would gather my colleagues, and we would go trekking in the Western Ghats. So it was two different stories. Uh, he would be somebody who would organize treks with his friends in the Himalayas. And, um, so India Hikes was his brainchild, saying, uh, "Despite being blessed with the Himalayas, we don't trek." And, um, during his many treks, he, uh, realized that the lack of information is the biggest problem that plagues us. People don't know that these are possible. And that's when he, uh, wrote a blog about the Roopkund trek, uh, which he had been on, and the blog became very, very popular, and people started to go to Roopkund on their own, uh, by referring the blog. Uh, my parallel story was, uh, I used to trek in the Western Ghats. I wanted to trek in the Himalayas, too, and I was referring various blogs and resources, and I stumbled upon his blog, took inspiration from his blog, and I wanted to organize my own trek to Roopkund. Uh, back then, there were no organizers like India Hikes where I could go. Uh, basically, uh, you had to either spend a lot of money and you had to have a group of your own because, uh, going as one or two people was impossible to the Himalayas. And, um, I, I, in the quest of making my own group to go to the Himalayas following that blog, I went and placed a comment on his blog saying, uh, "I'm forming a group. Would anybody like to join me?" And that's when Arjun wrote back to me saying, uh, "I am doing this. Uh, we are launching a small thing called as India Hikes. Would you want to be a part of that group?" Now, that's where I said, "Yes, uh, why not? I'm referring to your blog. If I get to go with you, that's great." And, um, ov- and that trek happened to be the very first trek of India Hikes. And, um, over the trek, um, the impact the trek had on me, the impact the trek had on my, uh, fellow trekkers, uh, I just stayed in touch with Arjun. I did not want to let that world go despite, uh, being a software engineer, and I started helping him in, uh, publicizing India Hikes, publicizing the Roopkund trek, designing the trek for the next season. Um, so I was an, an integral part of the next season of the trek that happened. Um, our association continued like this for about seven to eight months, and that's when he said, "Okay, I think you should, uh, take a call if perhaps you want to just switch over from your software work to come into India Hikes. Be with me and, uh, let us grow this because we have an opportunity here."
- SPSpeaker
[on-hold music]
- NKNikhil Kamath
How big are the two companies for scale? I know that you're listed, so you can talk about the number.
- SPSpeaker
Yeah, yeah.
- NKNikhil Kamath
How big is MMT now?
- SPSpeaker
So, well, MakeMyTrip, uh, let's say gross booking value last year, fully, full last year reported it's about $11 billion.
- NKNikhil Kamath
Hmm. And your margin?
- SPSpeaker
Yeah, but gross take rate is about, let's say, that is revenue line for us is about 10, 10 and a half percent, so over a billion dollar.
- NKNikhil Kamath
So revenue, actual revenue is like a billion?
- SPSpeaker
Is about a billion dollar.
- NKNikhil Kamath
And on the profitability front?
- SPSpeaker
And, uh, I, our adjusted EBIT number adjustment is only share-based compensation is 1.7% of the gross booking number.
- NKNikhil Kamath
Which is?
- SPSpeaker
Which is 170 million.
- NKNikhil Kamath
Right.
- SPSpeaker
Roughly.
- NKNikhil Kamath
And IHCL
- 41:43 – 48:40
Will AI Change How We Book Travel?
- RMRajesh Magow
So what data matters, Nikhil, in this business is not necessarily that super top layer data
- SPSpeaker
Top layer is price, availability
- RMRajesh Magow
Is availability, price, you know, just the description of the product
- SPSpeaker
And under it?
- RMRajesh Magow
Under it is user related data, right?
- SPSpeaker
Like?
- RMRajesh Magow
The, the end traffic and your, like, your customer data. The tr- the preferences of consumers.
- SPSpeaker
Right.
- RMRajesh Magow
Right? Because what, let's say Nikhil has been coming to our platform and what has been buying over a period of time, different, different products. Let's say if you are buying an air product, you are taking a, you know, sort of, uh, going with the group, you were buying a homestay or you were buying a hotel, which kind of hotel were you buying? And even the funnel drop off data, like how much time are you spending? Are you a looker or are you, or are you, are you a booker? Are you a serious traveler or high intent traveler or a low intent traveler?
- SPSpeaker
So if you incorporate AI in your company-
- RMRajesh Magow
That is correct
- SPSpeaker
... you will not use these LLMs from the rest?
- RMRajesh Magow
No, we will. We, we, we will use LLMs-
- SPSpeaker
But then they get that data, no?
- RMRajesh Magow
No, not necessarily. Not all of it.
- SPSpeaker
I'm asking, you won't run a open source model of your own and try to put your data in that so it's-
- RMRajesh Magow
So I'll tell you, see, right now what we are trying to do, we are doing both, and it's an evolution of, uh, you know, uh, which I believe will happen. So early days, because these frontier models were very, very strong-
- SPSpeaker
Mm
- RMRajesh Magow
... so you end up using multiple frontier models, right? But-
- SPSpeaker
Like Claude and OpenAI
- RMRajesh Magow
All of them.
- SPSpeaker
Gemini.
- RMRajesh Magow
Like Gemini, the Claude, the Cursor, the, uh, uh, GPT. But, uh, the grounding of that will happen with our proprietary data. That data doesn't go anywhere. Like user reviews, for example, that only belongs to us.
- SPSpeaker
When you say grounding, what do you mean?
- RMRajesh Magow
Just to make sure that the accuracy and the relevance of the responses to the customer is far more accurate than generic.
- SPSpeaker
So after the model generates something, you're checking on your end if it's right?
- RMRajesh Magow
That is correct. So our own data is also intelligence.
- SPSpeaker
Why don't you run your own model on your own data? You must have so much data.
- RMRajesh Magow
You could potentially do it, right? But it- it's just a matter of, I don't know whether we will sort of evolve into that also or not.
- SPSpeaker
Right.
- 48:40 – 55:43
Customer Data vs Personal Hospitality
- SPSpeaker
the client.
- RMRajesh Magow
No, I think more important is the back of house. So the problem about AI and all these customer data is, suppose we are having coffee, like right now, but I go off coffee, and I start drinking tea. No matter which hotel I'll go to, they'll put coffee for you
- PCPuneet Chhatwal
And, uh, you know, you also get, get carried away, or you like drinking beer or, or gin, and suddenly you switch to something else, and then they'll still keep bringing that because that's what the data says.
- RMRajesh Magow
The pattern is.
- PCPuneet Chhatwal
So there is-
- NKNikhil Kamath
How much data do you capture at, at the hotels?
- PCPuneet Chhatwal
A lot.
- NKNikhil Kamath
Yeah?
- PCPuneet Chhatwal
A lot of data is captured, yeah.
- NKNikhil Kamath
I remember once staying in this hotel in Paris, "" La Reserve or something like that. It, it was a nice, like, boutique-y hotel. They would remember what I-
- PCPuneet Chhatwal
La Reserve is more like the Starbucks coffee thing.
- NKNikhil Kamath
Ne, ne. La Reserve is this old Napoleon "" converted into a hotel or something like that in Paris. It's like a tiny chain.
- PCPuneet Chhatwal
Hm.
- NKNikhil Kamath
But they would remember as much as how I had my eggs on my last trip there and what I ate with my eggs, and the next time they would remember and serve me exactly that. Do you think for a hotel business like yours it would make sense to capture that much data?
- PCPuneet Chhatwal
I don't think so. You know that, especially for us in India, you know, the service is from the heart. That's our Asian hospitality. We should not mechanize it so much. And we have so many cuisines.
- NKNikhil Kamath
Hm.
- PCPuneet Chhatwal
If I've had a dosa for breakfast, and maybe I want omelet tomorrow, and if I have a three-night stay, maybe the third day I want puri bhaji or something. See, it's very different. I think that's the, that's the challenge also to fit that in. If you look at the breakfast buffets in India, they are massive versus anywhere in the world. Anywhere. I have not seen-
- NKNikhil Kamath
What, what all do you capture datawise?
- PCPuneet Chhatwal
We capture, you know, the customer's preferences, the way they book, who they came from-
- NKNikhil Kamath
Preferences of?
- PCPuneet Chhatwal
Preferences of meals.
- NKNikhil Kamath
Right.
- PCPuneet Chhatwal
Preferences of, uh, drinks.
- NKNikhil Kamath
You mean like veg, non-veg?
- PCPuneet Chhatwal
Veg, non-veg also. Everything gets captured in that form.
- NKNikhil Kamath
Like, if I came to Taj in, uh, Lands End, which is right next door, and I ordered biryani six months ago, if I come back, you will know that I ordered biryani six months ago?
- PCPuneet Chhatwal
Yes and no. It depends who's capturing that data. So sometimes you do, and sometimes you don't. That is not, as I said, it's not very processed. It's from the heart. So if the chef is coming-
- NKNikhil Kamath
Hm
- PCPuneet Chhatwal
... and especially Lands End had this wonderful chef of ours who's now moved to Mahal Palace in Colaba. He will come to you and say, "Sir, " He has this very special art of doing it.
- NKNikhil Kamath
Hm.
- 55:43 – 1:03:05
Can Robots Replace Hotel Staff?
- NKNikhil Kamath
being.
- RMRajesh Magow
Yeah. See, we have our flight kitchen business, which is Taj SATS.
- NKNikhil Kamath
Yeah.
- RMRajesh Magow
SATS is, uh-
- SPSpeaker
Yeah, of course
- RMRajesh Magow
... the one that runs the Singapore airport also.
- NKNikhil Kamath
Mm-hmm.
- RMRajesh Magow
We have the capability of doing, I don't know, hundreds of tons of basmati rice cooked differently with just two people. Everything else is done by the machine, including the cleaning of the rice, the cooking of the rice-
- SPSpeaker
Absolutely
- RMRajesh Magow
... getting it packed with the cutlery, et cetera. So it depends what job, uh, that you're trying to do. When I talk about our sector, hospitality, the human hospitality is very difficult to replace by the robots.
- NKNikhil Kamath
In luxury.
- RMRajesh Magow
Especially in luxury.
- NKNikhil Kamath
What about ginger and budget?
- RMRajesh Magow
Ginger and all can happen, yeah. That is not, you know, that is more cookie cutter. So the very fact cookie-
- NKNikhil Kamath
It'll likely happen, right?
- RMRajesh Magow
Hmm?
- NKNikhil Kamath
It'll likely happen.
- RMRajesh Magow
It is happening. As we speak, it's happening. But definitely not, uh, upscale, upper upscale, and luxury.
- NKNikhil Kamath
How s-
- RMRajesh Magow
See, if y- you go to a wedding, you'll have only robots serving you, that's not going to happen.
- SPSpeaker
I'm surprised how much they spoke about this segment. [laughs] It feels like the whole episode was on this. [laughs] Um, look, you know, there is this visual of, of course, a robot delivering stuff in a hotel and moving around a hotel, which no doubt has caught everyone's, you know, fancy over the last many years, and it is still yet to be fully rolled out, and I'm sure it'll happen. Again, it's one of those things where I'm adequately paranoid about what will or will not happen in the future without pretending to be smart enough to predict that future. Um-
- NKNikhil Kamath
But would you bet on it?
- SPSpeaker
I, I, I 100% would. Look, I mean, I would always bet with technology's promises, not against it, ever. But all that I'm trying to say is the shape and form that it will take. For example, to even say it'll be a humanoid, which is a very specific term, I don't know, right? I mean, um, for me, any kind of friction, I mean, I- I- I would a- assume safely that, you know, no customer would ever say that, "Okay, in the name of a human touch, in the name of a great experience, I would want to deal with more humans," necessarily. At least not in most facets of their hotel experience, right? So, um, so for sure there would be a role for robots to play in, let's say, I don't know, cleaning the room, in bringing stuff to your room, um, you know, in, in helping you with checkout, check-ins, check-outs, payments, et cetera. Now, what shape and form does that robot take, or whether it is even a robot or not, is not s- is not something I would kind of place a bet on today. But I certainly think, like, you know, we have developed, for example, in our, in Medallio, the closest that we could have gotten to the DigiYatra experience in hotels, where for sure you could go check in, stay for a few days, check out of a hotel without even interacting with, with a human. Um, and I'm sure there'll be more of that coming. So I'm not in a position to say the layer above that will be humans or the layer below will be humans, et cetera. Um, it'll be interesting to see how this very intangible, soft aspect of human personality evolves in terms of how they see hotels. You know, do they see hotels as, as places they stay at? Maybe in our segment for sure, while they explore the city, such that the place should be just super efficient, does not matter what human interactions they have there or not, maybe the lesser, the better. Versus maybe if they are staying in a luxury resort somewhere where they would love their pampering, they would love their spa experience, where they would love to have a butler looking after them all the time, and so on. So how that expectation of hotels evolves, you know, we'll see. It's, it's probably part of the evolution of human psyche while traveling. But for sure, I think, uh, uh, I would certainly bet in favor of eliminating friction and not leaning on the human touch to keep it. I don't think any customer would welcome that.
- NKNikhil Kamath
Hmm. Say in five years from now, how will MMT and IHCL change by virtue of A- AI, both, like, physical and digital? You can go first.
- RMRajesh Magow
I'll tell you. See, the, um, first the consumer facing, right? Because, um, which is over the last 25 years has also been evolving. You know, first the device preference changed from des- desktop browser to mobile app, and so on, and people got used. And now, I think the future is likely to be conversational interface, right? Which is what we have started building. You know, with, to your earlier, uh, question on GPT, et cetera, see, one part of the thing is that because we have rich data, you also start building that sort of-
- NKNikhil Kamath
Mm
- RMRajesh Magow
... uh, leveraging AI and build that interface because it's conversational. Ironically, and I've started giving this example at many places, now think about it, the shift earlier happened from human touch, where traditionally people will call the travel agent, right? Because I want to talk to someone. Moved from human interaction to self-service. Internet, all e-commerce businesses are self-service. You come on, this thing is very convenient. You can choose what you like of your choice, and you can do it at a quick speed, right? With the sheer convenience of doing it, right? I don't have to... Just a click of button. I don't have to interact with anyone. And now [chuckles] with the AI, it is going back to conversation. So-
- NKNikhil Kamath
So you will build a MMT interface which is voice first?
- RMRajesh Magow
Already there.
- NKNikhil Kamath
Mm.
- 1:03:05 – 1:09:52
Bringing Small-Town India into Online Travel
- RMRajesh Magow
going to be journey in my view. But the opportunity is going to be, now think about tier three, tier four, the gap that we have on internet penetration and e-commerce penetration today. Internet penetration is 900 million plus.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
You know, maybe a billion already. And the online buying is about 250, 300 million, depending upon which, all, all told also, by, by and large. So m- I think there is a clear opportunity for a discretionary product like ours, another 200 million.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
Right? Now, they're not necessarily buying online for many reason, but one of them is that I have inhibition, I have inertia because of the language, and I, I'm overwhelmed when I come to the funnel. There's too much to, to deal with. Now I can just go on Myra, and I start having conversation, whether it is Hindi or English or Kannada or whatever it is.
- NKNikhil Kamath
So I think what you're saying and what he's saying is the same thing.
- RMRajesh Magow
Yes.
- NKNikhil Kamath
We are saying that premium will be human-like-
- RMRajesh Magow
Yes
- NKNikhil Kamath
... handmade.
- RMRajesh Magow
Absolutely.
- NKNikhil Kamath
But everything budget and affordable will become more AI.
- RMRajesh Magow
I'll tell you about-
- PCPuneet Chhatwal
Even in premium
- RMRajesh Magow
... e- even in premium.
- PCPuneet Chhatwal
Even in premium. I give an example. Hotel President in Mumbai, try that. You have, um... I mean, you're talking to a machine, booking a table, but you don't get to know till almost the conversation is going to end. But it's done very well. We are getting more orders, and that's where humans get replaced. But I doubt if in the premium you'll have machines coming and serving you or you, it opens up-
- NKNikhil Kamath
It'll be human with a machine
- PCPuneet Chhatwal
... yeah, it'll be a human with a machine.
- RMRajesh Magow
Yeah, but it's-
- NKNikhil Kamath
But services will become more niche. Like, the, the difference between a mass premium and a ultra premium will be completely different, where one will require a completely different kind of answer, and another will require a completely different kind of answer.
- PCPuneet Chhatwal
Yeah, I think so, and I think maybe we are five, 10 years, uh, away from that also happening in India-
- RMRajesh Magow
Yeah
- PCPuneet Chhatwal
... or this big change.
- RMRajesh Magow
I think.
- PCPuneet Chhatwal
But it's like anything ... You know, 20 years ago, if you went to a Japanese place and wanted to have a sushi, it was already, you know, something which was rolling out. You just pick it up, right? What you wanted, and then you paid it through the machine. Or you go and buy any clothes anywhere today in, uh-
- RMRajesh Magow
Yeah
- PCPuneet Chhatwal
... any advanced country. You just put them in a thing, it au- automatically gets charged. So all that will happen. But in service sector, I think it will take time because you just don't pay for the product. You also pay a premium for the service that you are being provided.
- RMRajesh Magow
For the human touch.
- NKNikhil Kamath
So if Google owned discovery of hotels or flight tickets or whatever, and then MMT came and sat on top of that, in the next leg of the cycle with AI, is it MMT on AI, or is it something which is AI native?
- RMRajesh Magow
No, I think it's going to be independent vertical and solving, uh, end-to-end funnel. So let me give you an example today, so-
- 1:09:52 – 1:16:37
Should Hotels Cut Out the Middleman?
- RMRajesh Magow
business, believe it or not, happens.
- NKNikhil Kamath
I have this question for you, Puneet.
- PCPuneet Chhatwal
Mm.
- NKNikhil Kamath
Like I see that now, say Zomato, Swiggy, for restaurants, the margins that they charge are so high, and you'll have a view on it because of being on Info Edge board. I see at some point soon, the restaurant himself will want to be discovered directly and build direct relationships and omit the middleman in a way. At your scale, the number of hotels and rooms you have to service, at what point will you be like, "Okay, I'll take my inventory out of all these discovery sites and manage it myself," because at this scale, people have to come to me?
- PCPuneet Chhatwal
So two things. First, I want to go back to something you asked as a 25-year-old.
- NKNikhil Kamath
Yeah.
- PCPuneet Chhatwal
I would tell the 25-year-old there's enough platforms, there are enough people working on AI. There's a lot of competitor overcrowding. Don't go there. Start a boutique hotel business or start very nice, clean budget hotel business, and you will have a lot of success.
- NKNikhil Kamath
Really?
- PCPuneet Chhatwal
Yeah, yeah. You could do thousands of hotels in India.
- NKNikhil Kamath
[upbeat music]
- RMRajesh Magow
I 100% think so. In fact, I would say that advice is more right today than it would have probably been 11 years ago when we actually started this. Because the timing is just so ripe, you know, in terms of where, um, our income pyramid is, what's happening to the middle income segment of the country, what's happening to people's aspirations to travel, fueled by a lot of things, but of course, importantly so, with their own incomes growing to a level where they can afford travel. And we've seen this in the examples of pretty much all developed countries, whether again, the usual suspects of a US, a China, where when the, when the demographics started to reach, when the macroeconomy started to reach a certain level, uh, it unlocks affordable travel, uh, because there are just so many more people which create the demand pull for those kind of, uh, offerings. So yeah, 100%, I think that's the right advice today. So many things that I would want to get built out in this entire ecosystem. Being early movers in this ecosystem, honestly, we've had to put in a lot of effort in building each and every layer out. Just like a Flipkart or Amazon, when they started, they had to build out every rail in the eco- in the e-commerce ecosystem. So whether it's finding good technicians in locations such as Coorg or in Alibaug, whether it's finding good cooks in these locations, uh, whether it's taking care of the facility management of these villas or even building these villas, we've had to find relevant folks to make this happen. We'd love entrepreneurs who can build entire businesses in each of these verticals, whether it's someone who becomes a caterer in Goa, or whether it's a caterer in Manali, or whether it's ... and a great baker who can deliver cakes to us in a location such as Ooty. Uh, so each of these locations, I think there's an opportunity for a lot of entrepreneurs to get created that can deliver services, whether it's someone who's delivering, um, you know, hikes, uh, to take people on hikes in a location such as Kasauli. So What, what I'm trying to touch on is that there are so many different layers that come together or services that come together to give a great experience, and I think for each of them, uh, we would love to see more and more entrepreneurs come up and build it.
- PCPuneet Chhatwal
If you look at, uh, Motel One in Germany, you look at Ibis in France or Formula One, Etap. You look at Premier Inn in UK, look at, uh, Travelodge in UK, look at Hampton Inn in, in the US and, you know, Country Inns, Comfort Inns. There's so many brands. Then look at the population of India and the amount of supply we have in this segment. So there is a big opportunity.
- NKNikhil Kamath
But affordability is also lesser, no?
- PCPuneet Chhatwal
The affordability is less, but it's increasing every day. So when you start thinking of it today, by the time you build, the affordability factor will come in.
- NKNikhil Kamath
Like, as a sector, out of India's GDP, let's say the GDP is 4 trillion.
- PCPuneet Chhatwal
Yeah.
- NKNikhil Kamath
Tourism, direct and indirect, all of it put together is only about 6%, 200 billion, which compared to, say, the West, when you're comparing to the US, is a significantly smaller number.
- PCPuneet Chhatwal
So that means it'll only go up, right? If India-
- NKNikhil Kamath
If the GDP-
- PCPuneet Chhatwal
... is going to be 30 trillion instead of 4, then if 10% is coming from tourism, which is 3 trillion-
- NKNikhil Kamath
But if you're growing-
- PCPuneet Chhatwal
... and 80% of it is domestic, that's how it will work.
- NKNikhil Kamath
But if you're growing at 6% or 7%, the number of years of compounding required to get to 30 is by the time the youngsters' kids are dead.
- PCPuneet Chhatwal
So that is the opportunity.
- NKNikhil Kamath
Yeah.
- PCPuneet Chhatwal
Because a lot of tourism today is in unorganized sector, so that doesn't get counted.
- NKNikhil Kamath
Mm.
- PCPuneet Chhatwal
You know, your Dal Lake Shikara wala, the rickshaw wala in, you know, from the ghat to Kashi Vishwanath Temple. Those people who are selling stuff to the, the tourists coming from Switzerland or Germany or Sc- or Scandinavia. This will get eventually organized, and those numbers change. At the moment, we are saying six because you are not able to capture the unorganized number.
- NKNikhil Kamath
Like, these tou- tourists coming from outside, the number for India is 20 million. The number-
- PCPuneet Chhatwal
It's not even that.
- 1:16:37 – 1:23:51
India’s Mid-Range Hotel Opportunity
- RMRajesh Magow
one, one, one, one opportunity. That's the one data point. The second one is also the non-standardization.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
When we were talking about it in the beginning, let's say before we, uh, started, the opportunity of the mid-segment hotels, the one that you were talking about or the one, let's say, you know, Puneet was talking about earlier, which can give a better quality experience. The opportunity is huge. Like, uh, you know, Bloom Hotels, for example, Bloom chain, right? It's a good example of that hotel. All what they have tried to do is to reposition that, that, uh, you know, sort of accommodation differently, you know?
- PCPuneet Chhatwal
We did that with Ginger, too.
- RMRajesh Magow
Yeah, Ginger, Ginger as well, right? So-
- PCPuneet Chhatwal
Lean we made went from, uh, budget to lean luxury, right?
- RMRajesh Magow
Absolutely, lean luxury, right? So that's, like, a great, uh, sort of term to put in, right? So if you look at it from a supply standpoint, there is ton of opportunity because today, on season, uh, you know, when you have peak seasons or long weekends, you will be short, uh, on inventory, and therefore people would want to go out. One reason. The second one will be because the prices go up, right?
- NKNikhil Kamath
If we are short of inventory like you are saying, why is the occupancy not 100%?
- RMRajesh Magow
No, but because when we look at, we measure occupancy, well, and he will be the expert.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
But when we measure occupancy, we look at it 365 days.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
You should look at occupancy when it is peak season, season people, yeah.
- NKNikhil Kamath
But I can't build a business model based on peak, right?
- RMRajesh Magow
No, not necessarily.
- PCPuneet Chhatwal
No, not, and also India is a tropical country.
- NKNikhil Kamath
Mm.
- PCPuneet Chhatwal
There are extreme weather conditions, so when it's very hot, people stay inside. Nobody from outside comes in.
- NKNikhil Kamath
Right.
- PCPuneet Chhatwal
When it's monsoon, it's monsoon. There is a certain segment-
- NKNikhil Kamath
Mm
- PCPuneet Chhatwal
... which comes to India only in the monsoon, especially from the Middle East.
- NKNikhil Kamath
Right.
- PCPuneet Chhatwal
They sit in the hotel rooms and just keep looking at the rains. I mean, they are fascinated.
- NKNikhil Kamath
But why is this number so low? Like you said, infrastructure, when we spoke earlier.
- PCPuneet Chhatwal
Infrastructure.
- NKNikhil Kamath
Only 10 million for a country with as much culture and history and culinary stuff.
- PCPuneet Chhatwal
See, you can have the best of the culture in the world, you can have the best of, uh, monuments, from Sun Temple to-
- NKNikhil Kamath
We have 45 UNESCO sites.
- PCPuneet Chhatwal
Yeah, 45 UNESCO sites.
- 1:23:51 – 1:30:46
Marketing India & Fixing Tourism Taxes
- NKNikhil Kamath
can change anything you want.
- PCPuneet Chhatwal
Uh, uh, the other thing I would do is obviously market India, the, what, uh, what Rajesh said, Incredible India 3.2 is maybe overdue as a campaign. Whether we call it Incredible India or Inevitable India or any other name, we need to market India. Malaysia followed India by doing Malaysia, Truly Asia, and we stopped somewhere. So I think that, that could be a big help, and-
- NKNikhil Kamath
Why is the government not marketing India?
- PCPuneet Chhatwal
Why is... I think India is a heterogeneous country with so many needs and wants that maybe in the list of priorities, this is not the top priority. Maybe there are other priorities. So where they have done, for example, one could argue, if I was, you said I'm the Prime Minister, right? I'm spending all this money on infrastructure, airports, trains, highways, so that we get more people and a better experience.
- NKNikhil Kamath
Mm.
- PCPuneet Chhatwal
Right? So what else you want? You are the indirect beneficiary, uh, of infrastructure is always tourism and hospitality, so that's a big benefit. That's the last mile which is missing. Um, I think the one more thing besides the marketing campaign that can be done is to have a comparable tax regime which helps you. If your airport taxes are the highest, if your cost of fuel is the highest, if your GST is the highest, if you have taking away input tax credit, et cetera, et cetera, then it already, you don't have infra status, you don't have industry status, then you have- All these other taxes coming in, that is a hindrance to investment coming into the sector.
- NKNikhil Kamath
When you say comparable tax regime, what are you comparing it with?
- PCPuneet Chhatwal
You could compare it to when people say, "Why Thailand gets more people? Why Vietnam gets more people? Why Singapore-
- NKNikhil Kamath
Let's say to-
- PCPuneet Chhatwal
... gets more people?"
- NKNikhil Kamath
Let's say to Thailand specifically.
- PCPuneet Chhatwal
Yeah. So specific to Thailand, they are far lower in-
- NKNikhil Kamath
Yeah
- PCPuneet Chhatwal
... you know, in the, in the GST equivalent of their country. Visas on arrival, e-visas, how that works, so the ease of-
- NKNikhil Kamath
Actually, visas are-
- PCPuneet Chhatwal
... ease of travel
- NKNikhil Kamath
... like, when I talk to my friends in the US and UK, they say it's really hard to get an Indian visa. Why is that?
- PCPuneet Chhatwal
I don't know. I have not applied for one [laughs]
- NKNikhil Kamath
[laughs]
- PCPuneet Chhatwal
... for a long time.
- RMRajesh Magow
No, but you're right, because, yeah, I don't think that level of openness there, see, we used to have almost, like, non-e-visa regime, and we moved to e-visa to, but very selectively. We haven't really... See, if you take a step back, Nikhil, what has happened is that we have, India is an investment destination, so India is, India had massive reforms to, to showcase India as a, as a, as a very premium investment destinations for the businesses and for the investors, and we got all the traffic. We didn't have to do anything. We just actually had to do fundamentally reforms to open up FDI-
- NKNikhil Kamath
Yeah
- RMRajesh Magow
... and position India as a big consumption story, and so on and so forth, right? Three, four big things on macros, and we attracted crowd immediately on the back of that, right? And they're the same crowd has been coming. They are not coming as tourists.
- NKNikhil Kamath
Yeah.
- RMRajesh Magow
When they come in, by the way, they go to Agra also.
- NKNikhil Kamath
Yeah.
- RMRajesh Magow
But they're not necessarily coming as, as tourists, right?
- NKNikhil Kamath
Yeah.
- RMRajesh Magow
And, and therefore, if you just use the same analogy-
- NKNikhil Kamath
Mm
- 1:30:46 – 1:38:26
Mass Tourism vs Luxury Tourism in Goa
- NKNikhil Kamath
Charters you're saying is low-end tourism or high-end tourism?
- RMRajesh Magow
Charter is basically mass tourism, right?
- NKNikhil Kamath
Why is that?
- RMRajesh Magow
Because it's just cheaper destination, but you get beach, and you get everything else along with the beach.
- NKNikhil Kamath
In my mind, when you say charter, I'm thinking high-end.
- RMRajesh Magow
No, not necessarily that, uh, elite charter.
- PCPuneet Chhatwal
No, that isn't-
- RMRajesh Magow
No
- PCPuneet Chhatwal
... that's another way to look at charters, yeah.
- RMRajesh Magow
That is elite. Uh, that, that is elite charter. No, no, no, not, not that type of thing.
- PCPuneet Chhatwal
This is 300 people or 280 or whatever in a-
- RMRajesh Magow
Yeah, this is just a-
- PCPuneet Chhatwal
... in a plane they come. They leave, and then the next set of 280 come.
- RMRajesh Magow
It's a charter bus.
- PCPuneet Chhatwal
All inclusive. Your drinks, food, all inclusive for a family of four. Very popular in Europe, for example, uh, on that part of the world, because wherever there is sun, they travel there because they don't get the sun six, eight months a year. So, uh- We could get a lot of that in Goa if we, if we were wanting to have that
- NKNikhil Kamath
But you think that's not good for Goa?
- PCPuneet Chhatwal
I don't think so.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
Yeah. Because we have-
- NKNikhil Kamath
What can Goa-
- RMRajesh Magow
... a lot of our customers also now in-
- NKNikhil Kamath
What can Goa do to get high-end charters?
- PCPuneet Chhatwal
There's nothing like a high-end charter. You can get, um-
- NKNikhil Kamath
In my mind, I'm thinking people who fly in private planes
- PCPuneet Chhatwal
... premium customers. Private planes, yes. You can get them, and, uh-
- NKNikhil Kamath
What does Goa need to change to do that? I'm just gonna go to the washroom and come.
- PCPuneet Chhatwal
Sure.
- NKNikhil Kamath
Please continue speaking.
- RMRajesh Magow
Yeah.
- PCPuneet Chhatwal
Mm. I don't think Goa needs to change anything to get those, because it does get that already today.
- 1:38:26 – 1:44:44
Can Luxury Trains Attract Premium Tourists?
- PCPuneet Chhatwal
I think one more interesting aspect would be, in order to fast-forward some of the, the, the tourism activity and getting inbound, is really the premiumization of our luxury trains.
- RMRajesh Magow
Yeah. Yeah, absolutely.
- PCPuneet Chhatwal
Uh, because we have the palaces-
- RMRajesh Magow
Yes
- PCPuneet Chhatwal
... we have the beautiful, you know, forests, et cetera. The train goes through them.
- RMRajesh Magow
Think about Europe rails, right? I mean, in Europe, like Swiss rails and the other, the interconnectivity between the countries, et cetera, is seamless, frictionless, and good quality.
- PCPuneet Chhatwal
No, but I was thinking more like, uh-
- RMRajesh Magow
Even super luxury
- PCPuneet Chhatwal
... Maharaja Express and-
- RMRajesh Magow
Even super luxury, yeah. Even super luxury, why not?
- PCPuneet Chhatwal
Palace on Wheels.
- RMRajesh Magow
With this kind of premium crowd there-
- PCPuneet Chhatwal
Taking that to a very different level.
- RMRajesh Magow
Absolutely.
- PCPuneet Chhatwal
That will help get those-
- RMRajesh Magow
Super premium
- PCPuneet Chhatwal
... private charters. We've had those, but the, uh, what we are saying, Nikhil, is-
- NKNikhil Kamath
Yeah
- PCPuneet Chhatwal
... in order to fast-forward this and get more quality-
- NKNikhil Kamath
Yeah
- PCPuneet Chhatwal
... very high paying-
- NKNikhil Kamath
Yeah
- PCPuneet Chhatwal
... one of the ways to do it fast-
- NKNikhil Kamath
Uh-huh
- PCPuneet Chhatwal
... is to do the best-in-class trains, uh, like the rest of the world has. So the latest one is, uh, you know-
- NKNikhil Kamath
Like China trains
- PCPuneet Chhatwal
... China did, Thailand, uh-
- RMRajesh Magow
Even Europe
- PCPuneet Chhatwal
... et ce- Europe.
- NKNikhil Kamath
But those are not profitable ventures. Like, even the Chinese government, till date, has not been able to break even on that. It requires a lot of CapEx.
- 1:44:44 – 1:51:24
Civic Sense & the Tourist Experience
- SPSpeaker
travel infrastructure and travel services that exist or not. I think it is a lot more about just who we are as people. It is about our civic sense. It is about what we consider as "" versus what we say "", right? We take a lot of pride, of course, in our jugaad. I think our jugaad is our biggest strength and our biggest weakness because the same jugaad translates into a lot of this unpredictability for someone who's not familiar with that jugaad, right? Someone who's coming from a different country. So, you know, whether it is relying on Google Maps, walking a street, having a pavement to walk on, um, not worrying about getting cheated by a service provider, by an experience provider, the safety of some of these establishments, et cetera, I don't think it can, it can be a matter of governance or policy making as far as the travel industry is concerned. Of course, it's a different thing, and it's, it's, you know, in my, in my w- view as a citizen, I do feel that we as a population need to be dealt with more strictly for us to, [laughs] you know, develop the civic sense which would otherwise be common, which will invariably ripple out to anyone who's dealing with us in our Atithi Devo Bhava, et cetera. So it's a lot more about that. You know, our roads have gotten much better, but... And, you know, our railways have gotten much better. But if in the same Vande Bharat train, a bunch of people are still littering, a bunch of people don't know that it's their responsibility to re- leave the washroom clean. Obviously a, an international traveler traveling in the same train will not consider Vande Bharat to be great infrastructure. So I think it's a lot more about us and how we operate as opposed to privatization or big governance changes for real impact to happen.
- PCPuneet Chhatwal
See, we need to think bigger.
- SPSpeaker
Mm.
- PCPuneet Chhatwal
We can't think Bombay, Goa anymore.
- NKNikhil Kamath
See, right now the gov- uh, right now-
- PCPuneet Chhatwal
Yeah
- NKNikhil Kamath
... as a country, we really need foreign currency. The government has this FCNR-
- PCPuneet Chhatwal
Yes
- NKNikhil Kamath
... FCNR scheme where-
- PCPuneet Chhatwal
Of course
- NKNikhil Kamath
... people are earning 20, 25%, bringing foreign capital into India.
- PCPuneet Chhatwal
I know.
- NKNikhil Kamath
If we can get more capital in, I'm saying even from 10 million foreign tourists, it doesn't go to 100, it goes to 20, is a big change. We're talking about all that needs to change in order to make that happen.
- PCPuneet Chhatwal
Yeah, but then we have to think a little bit beyond. We have to think cruise tourism from Bombay all the way till the tip of Kerala.
- NKNikhil Kamath
Mm.
- PCPuneet Chhatwal
And it's like, uh, three, four destinations. This is how it happens globally. This is what people are looking for. Just sitting on a cruise and going to Goa is not going to make it work. So anything that we do, and that's why Rajesh is right, that if it is a state subject only, the moment many states change, by the time you reach-
- SPSpeaker
Totally
- PCPuneet Chhatwal
... with different ideology, different political-
- SPSpeaker
Priorities
- PCPuneet Chhatwal
... I don't know, priorities-
- SPSpeaker
Yeah
- PCPuneet Chhatwal
... uh, it doesn't get done. It falls somewhere in the cracks. So-
- NKNikhil Kamath
So you're saying make tourism a center subject.
- PCPuneet Chhatwal
Center subject it has to... It could be both. So when I said, you know, if you recall, that infrastructure status, that is center. Industry has to be done at a state level.
- NKNikhil Kamath
Mm.
- PCPuneet Chhatwal
But some of the things, like marketing campaigns for destination India, has to come from the center.
- NKNikhil Kamath
Right.
- PCPuneet Chhatwal
That cannot come... Every state is going and marketing their own-
- SPSpeaker
Obviously
- PCPuneet Chhatwal
... state.
- 1:51:24 – 1:58:44
Making India’s Attractions Discoverable & Bookable
- RMRajesh Magow
and the activities that you could potentially do, you just cannot discover anything, and you cannot just seamlessly book anything. Like-
- NKNikhil Kamath
Give me an example. Like, hotels are digitized.
- RMRajesh Magow
Yeah. No, I'm not talking about hotels. I'm talking about, let's say, experiences. So all these sites-
- NKNikhil Kamath
Mm
- RMRajesh Magow
... you know, what kind of digitization have we done on the back end? You know, today we are trying to do it. So let's say MakeMyTrip has launched tours and attractions kind of thing. Our first port of call became more the international destination because there's plug-and-play inventory available, content available, inventory available, right? If I have to book a park, for example.
- NKNikhil Kamath
Why is nobody on the private side doing it?
- RMRajesh Magow
Private side, you can do it, but the government has to open it up, right?
- NKNikhil Kamath
Because the park, the parks are not privatized.
- RMRajesh Magow
Government has to open it up. No, no, take Taj as an example.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
Right? We, we ... This is the simplest problem to solve.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
Discovery, bookability. Qutub, for example. Take any site, any experience.
- NKNikhil Kamath
So the solution for that is first privatize them so the inventory can come online.
- RMRajesh Magow
Digitization, exactly. Yeah, first privatize and then do the digitization. Solution is digitization.
- NKNikhil Kamath
Right.
- RMRajesh Magow
Because then only you can solve for the reach, right?
- NKNikhil Kamath
Right.
- RMRajesh Magow
You know, that is one big thing that I think needs to happen-
- NKNikhil Kamath
Right
- RMRajesh Magow
... among various things on, again, in the, uh, you know, sort of overall experience bucket.
- NKNikhil Kamath
Right. What else?
- RMRajesh Magow
Right? And then I think, um, one of the other things that you can do is to, again, you know, sort of building on the, the industry status point, or let's say when you were talking about Lets India is trying to do the functional airports. The reality is that part of this, this ecosystem, um, the economics don't work, right? So the, the, the industry, let aviation industry, for example, it's a good example of that, right? So earlier, we had lot, many international carriers coming in.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
Bilaterals, right? We opened up bilaterals, et cetera, but they, they were coming in because the Indian carriers were not able to build and scale profitability.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
Right? Because it's really a long-term, so capital investment required. So what is that I, I can potentially do to showcase the same opportunity? If the money is coming into India in various other sectors, I'm talking about foreign investment, why can't there be money, a, a capital inflow that can happen in even in aviation sector, for example? Now, whether it is domestic institutions, because today domestic institutions have got a lot of funds as well, or it is ... When I talk about institutions, I'm not necessarily saying mutual funds and all.
- NKNikhil Kamath
Yeah.
- RMRajesh Magow
I'm also saying banking system, right? Uh, or if there is, you know, non-Indian capital that needs to be coming, whatever strings that you want to attach to.
- NKNikhil Kamath
You're saying allow FDI into-
- 1:58:44 – 2:05:56
Alibaug’s Potential & the Homestay Business
- RMRajesh Magow
We have over 100 villas in Alibaug, and Alibaug as a market is something we've seen really develop over the last 10 years. Um, I think we've only scratched the surface in Alibaug. 100 ro- 100 villas means close to 500 rooms there. That's roughly two big hotels already, and we feel confident that we can easily get another 200 odd, 300 odd properties there, which will be roughly five hotels. So a lot of potential in that market. Uh, definitely see it becoming a Long Island to Mumbai. [upbeat music]
- NKNikhil Kamath
But a lot of people are building hotels.
- PCPuneet Chhatwal
We have one.
- NKNikhil Kamath
Yeah.
- PCPuneet Chhatwal
We are running one. We have, I don't know-
- NKNikhil Kamath
Doing well?
- PCPuneet Chhatwal
... how many homestays. We're doing very well.
- NKNikhil Kamath
How is this homestay business? How big, how much of an opportunity is it if, for a 25-year-old again?
- PCPuneet Chhatwal
For a 25-year-old to have it as a start, it's a great opportunity. It's not that capital intensive.
- NKNikhil Kamath
Mm.
- PCPuneet Chhatwal
And, um, you know, if you ... The good thing is we have done it as a hub and spoke model. The Taj Hotel in the neighborhood takes care of your villa, so you have no security issues. You don't need a separate gardener. You don't have ... You know, you also get some income out of it, right? And you can use it for your own private use, like maybe a couple of weeks in season and a couple of weeks in off-season or even longer. So I think from that point of view, a lot of people in India are moving into that segment, like, a couple of hundred million, who want to have a second home-
- NKNikhil Kamath
Mm
- PCPuneet Chhatwal
... or a third home. Like you said, you have, you have a home in Bangalore, Mumbai. You spend a lot of time in Goa in your, in your house, but what happens when you're not there?
- NKNikhil Kamath
Mm.
- PCPuneet Chhatwal
If it's empty and you want somebody reliable to take care of it-
- NKNikhil Kamath
Mm
- PCPuneet Chhatwal
... then it's a very good business for any youngster, um, 25-year-old venturing out. Uh, you don't have to build a full-fledged hotel for that matter. [upbeat music]
- RMRajesh Magow
Give us the real numbers. What does it cost to bring one villa live on StayVista? What does the owner make in year one? And at what point does an owner decide they lo- no longer need you? Will you ever explore a franch- franchise model? Yeah, for a homeowner, it's a great, great outcome. Why do I say that? Because I, I am personally, uh ... I mean, not me, but my family has a home in Lonavala for the last 20-odd years, and basically, that P&L looked negative from year one. We were paying expenses to maintain that property, the staff salaries, the local community that you need to pay taxes for. So there were multiple other expenses that are constantly accruing, and you're paying for it. Uh, while in terms of enjoying that home, you're barely going there maybe once or twice a year. So at the end of the day, you have a negative P&L of roughly 1 to 2 lakhs per month. That becomes a positive P&L of 2 to 3 lakhs per month. Why does that happen? Because once the home starts getting used on a regular basis, all your expenses are taken care of, and you're getting a certain amount of revenue out of it, which you can either reinvest in the property, or you're actually just accumulating profits
- NKNikhil Kamath
What does it cost to bring one villa life to Stayvista?
- RMRajesh Magow
Most of these homes, they're beautiful homes that people have built. It's been a labor of love. What is required is a certain transformation so that they're guest ready. What do I mean by that is they might need certain standardized crockery, linens, little bit of maintenance work that needs to be looked into with respect to, uh, ACs being fixed or, uh, CCTV cameras being put in certain parts of the exteriors of the house. All of that accumulated will be an expense of anything between eight to twelve lakhs. That amount is recovered within four to five months by the homeowner.
- NKNikhil Kamath
[upbeat music] In theory, I agree with you a hundred percent, but Airbnb does not seem to be working out in that way, right, in the US?
- PCPuneet Chhatwal
No, I just spoke about the model that we have on Ama. It has worked quite well.
- NKNikhil Kamath
Isn't Airbnb the same model?
- PCPuneet Chhatwal
Airbnb is different. From service point of view, it's different. Here-
- NKNikhil Kamath
It's not service
- PCPuneet Chhatwal
... you can ask Taj Holiday Village or Aguada or whatever Exotica to come do a barbecue for you. You can ask them to do breakfast for you.
- RMRajesh Magow
It's in the broader space, alternative accommodation, but maybe there's an-
- PCPuneet Chhatwal
You could go to the hotel and have breakfast. You know, it's not, it's the, the experience.
- NKNikhil Kamath
You're adding service.
- PCPuneet Chhatwal
Yeah, we're adding service because that's what our core business is. Our core business is to provide service.
- 2:05:56 – 2:13:42
Why Celebrations Are Driving Villa Bookings
- RMRajesh Magow
With the, uh, and this is now I'm talking about business cities, right? You know, all the urban cities of Bangalore, Delhi, Bangalore, uh, Bombay, Calcutta, Hyderabad, Chennai. The group getting together and celebration use cases have gone through the roof. These are all homestays.
- NKNikhil Kamath
Hmm.
- RMRajesh Magow
You know, so festival celebration, the birthday celebration, the any occasion.
- NKNikhil Kamath
Hmm.
- RMRajesh Magow
Like they, they need an, they need an excuse, uh, for lack of a better word, for, for you, for you to just get together because you get a lot of flexibility.
- NKNikhil Kamath
Hmm.
- RMRajesh Magow
You get a lot of flexibility there. Hotel, you will not get flexibility. You, you need to have music. I mean, there are, their needs are very specific, limited, but specific. [upbeat music] Occasions is a massive reason to come stay together at villas. Uh, we look at every stay as a mini event taking place because there's always something being celebrated when people are coming together, whether it's birthdays, anniversaries, even intimate weddings or a corporate offsite or school reunions taking place. So there's always an occasion that brings people together, and it's, it's, it's a small group of very close folks that come together to celebrate. And actually, a big need that we have to deliver to is how do we, how do we create an entire experience for them? So, for example, if it's a wedding, uh, for just 10 to 20 people at one of our properties, we need to be able to get the entire ecosystem together, whether it's the decorators, whether it's a bartender, whether it's a caterer, so all of that needs to be brought together. Uh, we see about 20% of our bookings are taking place for non-family stays. What I mean by that is primarily taking place for corporate offsites or for these small intimate weddings in particular.
- PCPuneet Chhatwal
Right.
- RMRajesh Magow
The last weekend we had Malhar and Sea-
- PCPuneet Chhatwal
Yeah
- RMRajesh Magow
... at Exotica, and exactly that happened, what you're saying.
- PCPuneet Chhatwal
Yeah.
- RMRajesh Magow
People came in groups of 10-
- PCPuneet Chhatwal
In group
- RMRajesh Magow
... 12, 14. The event was sold out. The best of cultural experience.
- NKNikhil Kamath
What is Malhar?
- RMRajesh Magow
That was the name of the event that, because it comes from all that musical performances.
- NKNikhil Kamath
Hmm.
- RMRajesh Magow
And it was just outstanding. I have to see, for, I... It was the first time for me. I was very impressed. I thought we could bring it to other parts of India.
- PCPuneet Chhatwal
Absolutely
- NKNikhil Kamath
Which is your favorite Taj hotel amongst all? The best hotel in your mind, if you had to retire in one?
- PCPuneet Chhatwal
Uh, very difficult question. There's so many of them which are-
- NKNikhil Kamath
One
- PCPuneet Chhatwal
... so iconic, but one which is consistently been rated now, uh, worldwide on TripAdvisor and, uh, as the best hotel in the world is, uh, Rambagh Palace in Jaipur.
- RMRajesh Magow
Jaipur.
- NKNikhil Kamath
I've been there.
- PCPuneet Chhatwal
For me, it was always Lake Palace because of the setting in the lake.
- NKNikhil Kamath
Mm.
- PCPuneet Chhatwal
Uh, but the ratings of Rambagh have been just brilliant.
- RMRajesh Magow
Wow.
- 2:13:42 – 2:19:43
What Travel Business Should a 25-Year-Old Start?
- RMRajesh Magow
effectively.
- NKNikhil Kamath
If you had a son who was 25 and he wanted to be a travel agent, say 4 out of 10 travel bookings are still offline, would you recommend that? Is there a angle a 25-year-old can take? Applies to both of you. Is that a business opportunity?
- RMRajesh Magow
I think so. Uh, there's an opportunity, although my son might want to do different stuff he doesn't want to-
- NKNikhil Kamath
Where would he sit between MMT, between the hotel business, and between things like-
- RMRajesh Magow
The opportunity?
- NKNikhil Kamath
Yeah.
- RMRajesh Magow
I think-
- PCPuneet Chhatwal
Hotel business, obviously. [laughs]
- RMRajesh Magow
[laughs]
- NKNikhil Kamath
Yeah?
- PCPuneet Chhatwal
Yeah, it is boring, you know, this MakeMyTrip.
- RMRajesh Magow
[laughs]
- PCPuneet Chhatwal
It's like just finding just travel solutions.
- NKNikhil Kamath
Mm.
- PCPuneet Chhatwal
There's nothing ... Hotel is a happening place.
- RMRajesh Magow
[laughs]
- PCPuneet Chhatwal
24/7, 365 days.
- NKNikhil Kamath
So if your son were to start a hotel business What son or daughter? What's, what category would you put him on? You can only pick one. Would it be boutique? Would it be luxury? Would it be affordable?
- PCPuneet Chhatwal
Where in the world is very important.
- NKNikhil Kamath
India.
- PCPuneet Chhatwal
India. So in India, I would say the opportunity going forward is, uh, strong in experiential boutique, small size properties.
- NKNikhil Kamath
By small, you say 50 rooms.
- PCPuneet Chhatwal
25 to 50, 25 to 50-room hotels. We have a lot of tier two, tier three cities which can't have 100, 150, 200, 300 rooms or go very large.
- NKNikhil Kamath
And how would you put the price point of this? Is it 5,000 a room, 15,000, 50,000?
- PCPuneet Chhatwal
No, it could go up to 10,000.
- NKNikhil Kamath
You're saying average to 10,000 rupees.
- PCPuneet Chhatwal
Average to 10,000. Because your luxury sits at 20 plus, and your budget and mid-scale sits around 4,000, 5,000. So double of that, but 50% of the luxury.
- NKNikhil Kamath
Is there a business opportunity in what Ritesh tried to do? Like buying-
- PCPuneet Chhatwal
Branded
- NKNikhil Kamath
... small unbranded? Because most of India is unbranded. Can you, if I were 25, can I buy, not buy, but make a deal with 10 hotels, paste a brand on it, standardize?
- 2:19:43 – 2:27:16
Handling Bad Experiences & Building Trust
- PCPuneet Chhatwal
Uh, yes. I mean, you need, uh, you need years of work behind getting a good, uh, name and reputation, but one bad incident can actually take you back, uh, in a lot of good work that you have done. And time to time we do have incidents where we believe, okay, this was not okay. Uh, what we try to do, it's, it is one in thousands, but still a lot of attention has to go behind, uh, what went wrong for this person and what can we as an organization do to change the perception that they have had or the experience that they have had. Because, uh, intrinsically we believe, um, we don't deserve that experience to go to them. Uh, it is not who we are. And, uh, we go a long way in trying to convince people saying, "Okay, come with us again. Uh, don't pay us any money."
- NKNikhil Kamath
But see that we are not what the experience that you had, and our experience is re- truly different, and we believe that, um, it is not what you had, had
- SPSpeaker
It is the most difficult industry to be in. Trust me when I say this. That is why you will see a lot of travel companies coming in, but they would go that easily because they will realize that it's so difficult to actually make people happy.
- NKNikhil Kamath
Yeah.
- SPSpeaker
Right? And then a lot of time, things are not in your control. For example, there was this one trip wherein the, the people came at 6:00 AM, and the bus was supposed to come at 6:00 PM, AM also, but the bus came at 8:00 AM. People were waiting for two hours. It was not our mistake. It was a vendor mistake. But of course, we are the face. We will be blamed. So now, no matter whosoever commits a mistake, the vendor, the hotel, whatever, we are at fault, right? So you have to own up, and then a- also compensate. Don't be afraid of that. If you're at fault, compensate in whatever form you can because th- this, this is the stage when you are building your customers. [piano music]
- RMRajesh Magow
Uh, but I think the other point there is that low touch would not work there. Little bit of a high touch will be required because you have to improve the experience of that, right? Standardization will come in, in the property, right? With a lot of these models were, you know, more low touch, which means give your brand from a consumer standpoint, but the underneath promise was not necessarily standardized, right? So there, so if you end up doing that, I think there's an opportunity, clearly. I'll tell you the other area of opportunity since you talked about, uh, let's say, 25 years old. I think there's an opportunity in India, like a, think like GetYourGuide or a Klook kind of a model.
- NKNikhil Kamath
Say again.
- RMRajesh Magow
I- it's a tours and attractions, uh, aggregation.
- NKNikhil Kamath
Like you plan everything.
- RMRajesh Magow
You plan, you plan, um, you can plan everything, or you can be in that niche only, focusing more on f- Gen Z needs because that's going to be the future. So just think about Gen Z, study that, their potential, and by the way, nuanced needs that they have, right? And then build your product on top of it.
- NKNikhil Kamath
Right.
- RMRajesh Magow
Right? You know, so it could be, basically it'll be entertainment and experience.
- NKNikhil Kamath
Right. Same again, you're coming back to experiential hotels, wouldn't you?
- RMRajesh Magow
Experiential-
- PCPuneet Chhatwal
Yeah, and is a good one because hoteliers are not, traditional hoteliers are not good at this. You could actually, a 25-year-old could tie up-
- RMRajesh Magow
Yeah
- PCPuneet Chhatwal
... for some of those, you know, special properties, special locations. Let's say Gangtok.
- NKNikhil Kamath
Right.
- PCPuneet Chhatwal
A visit to the China border, a visit to the monastery.
- RMRajesh Magow
Yeah.
- PCPuneet Chhatwal
Hotel can also do it.
- NKNikhil Kamath
Right.
- PCPuneet Chhatwal
But if somebody comes as a 25-year-old, disrupts it, takes the inventory for five, six, eight, ten hotels in just the northeast, you know, those Seven Sisters, I think that could be a runaway success.
- RMRajesh Magow
It's eco plus plus.
- NKNikhil Kamath
Right.
- RMRajesh Magow
It's not only eco.
- NKNikhil Kamath
Like he said, he, he'll make his son or daughter start a hotel, experiential boutique, 10,000 rupees average room rent, 40, under 40 to 50 rooms. What you said in the travel industry, there is a opportunity to be a travel agent.
- RMRajesh Magow
Eco plus experiences-
- NKNikhil Kamath
What would be the travel agent angle?
- RMRajesh Magow
... platform. That's the platform, aggregation. I would not build.
- 2:27:16 – 2:34:40
Nandan Nilekani & the Shift to Hotel Branding
- NKNikhil Kamath
He's working on this new project. Like, me and Nandan had gone to, uh, Switzerland recently, Nandan and Rohini. Not Switzerland. Uh, we were in the US somewhere. He has this new project around the Finternet. He calls it Finternet.
- RMRajesh Magow
Mm.
- NKNikhil Kamath
He's trying to tokenize... I'll send you guys the white paper. It's very interesting.
- RMRajesh Magow
Love to, love to read it.
- NKNikhil Kamath
Tokenize asset classes across the board and across geography.
- RMRajesh Magow
Oh, my God.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
He should do it in India?
- NKNikhil Kamath
He's doing it in India only.
- RMRajesh Magow
Oh, he is?
- NKNikhil Kamath
Yeah, yeah.
- RMRajesh Magow
Huge, huge opportunity, because the asset classes are not tokenized at all.
- NKNikhil Kamath
Yeah.
- RMRajesh Magow
I mean, forget about tokenized. There's hardly any digitization.
- NKNikhil Kamath
Yeah, it's a very interesting white paper. Even I, I've read it a few times. I've had the person who's in charge of it explain it to me. Nandan has also explained it to me. I don't get it fully, but something worth reading.
- RMRajesh Magow
I would love to read it.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
But amazing energy, no? Even now.
- NKNikhil Kamath
Yeah.
- RMRajesh Magow
Like-
- NKNikhil Kamath
Actually, not just Nandan. I think people speak about Nandan, but they don't know Rohini. Like, his wife is the... It's a relationship-
- RMRajesh Magow
Force behind
- NKNikhil Kamath
... where the wife is the more, uh, fiery-
- RMRajesh Magow
Wow, really?
- NKNikhil Kamath
... opinionated one, and she's lovely. But, uh, yeah, I think Rohini's personality has not come out yet, but very interesting, very en- endearing person.
- RMRajesh Magow
Very well.
- NKNikhil Kamath
Yeah.
- RMRajesh Magow
Uh, done world of good to the country.
- NKNikhil Kamath
Yeah. Bangalore actually has a really good, uh, set of people.
- RMRajesh Magow
Mm.
- 2:34:40 – 2:41:13
What It Takes to Run an Asset-Light Hotel Brand
- SPSpeaker
So, um, I agree with them entirely, and again, it's, it's an often misunderstood aspect of our business that we are a light touch franchisor, and this is one of the things that I was alluding to when I said that, you know, our business model, which has been custom built for this segment, is often misunderstood or ill understood by, by other people in the industry. Um, we actually do a whole lot more than what a typical franchisor would do. There are conventional brands in the higher segments who are pure franchisors who do the light touch franchising that is being spoken about here, and what they do, for example, is that their people would audit the hotel twice a year. Our teams audit the hotel every week. Their teams don't get involved in trainings. Their teams don't use any technology to keep a check on the quality of the property. They, they don't analyze 150 data points on what's going wrong from an experience standpoint. They have not built custom technology for that process. We control the flow of the money. We control the flow of revenue, and we are very closely hands-on involved in helping the hotel deliver the kind of experience we want them to deliver. So for the sake of simplicity and loosely, our model is called a franchising model, and our, some of our other competitors have not done justice to kind of doing more than just that. So I understand that we are also often seen as having just that model, but it is a lot, lot, lot more evolved and deeper than just light touch franchising. I agree, light touch franchising doesn't work. [upbeat jazz music]
- RMRajesh Magow
And if he's starting one property, he can be high touch. Easily. Yeah. And then once you learn- Mm ... so you've scaled it, and this is what is happening in the, by the way, mid segment. Mm. Right? You know, I was giving an example of Bloom, for example. Right. You know, they are not necessarily asset heavy models at all. They're, like, managed. Right. And they are bringing the experience and potentially once that brand is established, you can then do, but you have to have, you know, quality focus in place. Like, global, good example and, and, you know, and, and Puneet can validate that Wyndham is a good branded global brand, but lot of the franchise hotels, for example. Right.
- SPSpeaker
Almost 100% franchise hotels.
- RMRajesh Magow
Almost 100% franchise hotels, right? And that, that's a successful global model. But it is not necessarily, you know, if you want to keep it and saying, "I have an established brand and I will just monetize my brand and charge royalty and do nothing more than that," that model will not work, right? Because the experience on the ground will not be great.
- SPSpeaker
No.
- RMRajesh Magow
See, last year we did three acquisitions. Mm. One is in integrated wellness. Mm. Where two youngsters- Mm ... they started a business called Atmanthan. Yeah. Just near Pune. Ten years later, they are not 25, they maybe got closer to 40 or [laughs] - Mm.
- SPSpeaker
Yeah
- RMRajesh Magow
... or something. Uh, we decided to acquire a majority, but keep them in because maybe they needed the strength of our balance sheet and we took out all their debt-
- SPSpeaker
Yeah
- RMRajesh Magow
... and put enough money so that they can grow exponentially. Right. Same thing we did with Clarks Inns, which will all convert to Ginger, Ginger brand or are in the process of getting converted, and finally with Bridge. And Bridge is a very nicely done brand in boutique, uh, luxury. And there are some places, you know, I was surprised myself, they have a Bridge property in Jawai which gets an average rate of 70,000 rupees.
- SPSpeaker
Absolutely.
- RMRajesh Magow
I have-
- SPSpeaker
Yeah. There, there are very few. There's demand supply gap there. And Bridge has done a fantastic job there.
- RMRajesh Magow
Has done a fantastic job. So-
- SPSpeaker
If you go to Varanasi, you should go and stay at Bridge.
- RMRajesh Magow
Yeah?
- SPSpeaker
Mm. At the Ganges.
- RMRajesh Magow
It's the other way. It's the other way around where somebody was there, we gave them the capital for all the hard work they did.
- SPSpeaker
That's true.
- RMRajesh Magow
Left a lot of capital in the company so that-
- SPSpeaker
We can further grow
- RMRajesh Magow
... they can further grow.
- SPSpeaker
Yeah.
- RMRajesh Magow
And give them the mandate to do it. So we only operate through the board. It's not that suddenly all our-
- NKNikhil Kamath
Mm
- RMRajesh Magow
... colleagues who have been there for 30, 40 years-
- NKNikhil Kamath
Yeah
- RMRajesh Magow
... take over and tell them what, what is to be done.
- NKNikhil Kamath
Whenever I travel to the West now, to New York or London or LA, everything is a membership club. Like, a lot of hotels like, uh-
- RMRajesh Magow
Right
- 2:41:13 – 2:48:44
The Wellness Hotel Opportunity
- NKNikhil Kamath
would you pick between a membership club and a wellness hotel? If you could start one, what would you start?
- RMRajesh Magow
Wellness.
- NKNikhil Kamath
Yeah?
- RMRajesh Magow
I tend to agree. India potentially wellness is, is going to-
- NKNikhil Kamath
Because of yoga and all that
- RMRajesh Magow
... because of not only yoga, and also people becoming health conscious.
- NKNikhil Kamath
Yeah.
- RMRajesh Magow
And if you start to think long term, like 10, 20 years down, it's a huge opportunity.
- NKNikhil Kamath
This is something I want to do.
- RMRajesh Magow
Yeah.
- NKNikhil Kamath
Start a yoga plus Western medicine mixture-
- RMRajesh Magow
Absolutely
- NKNikhil Kamath
... with hotels. Nowadays, when I pick a hotel, like, I'll give you an example. When I'm in the US, one hotel I used to stay at had a sauna, the other one did not have a sauna. I started picking the one with the sauna just for that, and I'm thinking there are more people like me in the world, increasingly.
- RMRajesh Magow
There is. You're so, uh, right on that. When I came to India and I stayed the first, you know, part of my journey at the Taj Wellington News.
- NKNikhil Kamath
Right.
- RMRajesh Magow
And there was no sauna in there, not because of me. I realized that this is where people are moving, and we put in a sauna, a small one, very successful-
- NKNikhil Kamath
Yeah
- RMRajesh Magow
... in both the ladies and the men's, uh, you know, wet areas. And of course, steam room is there, and people love the steam because it helps you breathe, uh, you know, more freely because of the pollution issues. But the real health benefit you get from the sauna and not from the steam.
- NKNikhil Kamath
Yeah.
- RMRajesh Magow
Absolutely. You, again, you have, and you must study that model if you're really keen, you have flavor of that in golf clubs. Like, if you see DLF Golf Club in Gurgaon, it has all of it, what you just mentioned.
- NKNikhil Kamath
Yeah.
- RMRajesh Magow
And then different kinds of saunas.
- NKNikhil Kamath
Yes.
- RMRajesh Magow
I mean, especially-
- NKNikhil Kamath
Sauna
- RMRajesh Magow
... the Germanic countries-
- NKNikhil Kamath
Uh-huh
- RMRajesh Magow
... and the Scandinavian, it's a specialty of theirs to have, uh, you know, with herbs and with kreuteres and with salt, and with the Japanese [laughs] -
- NKNikhil Kamath
The new thing is that dead sea salt on the walls.
- RMRajesh Magow
Yeah, that is also quite good.
- 2:48:44 – 2:56:16
Building Travel Businesses for Gen Z
- NKNikhil Kamath
I'm done with my questions. Any advice?
- RMRajesh Magow
Unique insights, like context-
- NKNikhil Kamath
Around your industry
- RMRajesh Magow
Around?
- NKNikhil Kamath
Around what I can build in your industry, or even if I can get a job in the hotel industry or-
- RMRajesh Magow
Yeah
- NKNikhil Kamath
... in OTF.
- RMRajesh Magow
So one of the things that maybe, maybe I can just kickstart that. So I think one of the things that as, as MakeMyTrip, in the MakeMyTrip strategy workshop that we've been going really deep into it, is to understand the future and potential of this younger generation. That how are they going to spend differently? How are they going to, you know, sort of travel differently-
- NKNikhil Kamath
Yeah
- RMRajesh Magow
... and celebrate differently, and therefore, what could be the business opportunities around it? And then, uh, what, how can I acquire them potentially, right? And very focused, therefore, I was just giving that idea earlier, that if I have to advise someone young to build something, I think it's to go deeper into understanding this cohort, understanding-
- NKNikhil Kamath
You're saying build for Gen Z
- RMRajesh Magow
... build for Gen Z.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
That is the future.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
They have the spending power.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
They have, uh, they're confident, and they want to experience.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
They don't want to save. Traditional mindset is gone, but the experiences could be very different. Like, I want to go trek, right? Now, how many people, older generation, wanted to go to trek in India?
- NKNikhil Kamath
You're saying build experiences around that or real estate around that?
- RMRajesh Magow
Everyth- no, not real estate. No, well, you can do both.
- NKNikhil Kamath
Mm.
- RMRajesh Magow
You know, depending upon-
- NKNikhil Kamath
Build a hotel where you can trek or build a trekking thing around a hotel?
- RMRajesh Magow
It, it depends how much capital do you have, right?
- NKNikhil Kamath
Mm.
- RMRajesh Magow
I mean, depends how much resources do you have. But if you don't, let's say, if you don't have resources and you want to do a tech-led thing, then I build a platform.
- NKNikhil Kamath
Mm. [upbeat jazz music]
- PCPuneet Chhatwal
So, uh, in the last four, five years, we have specialized groups, uh, family groups, uh, seniors treks. Uh, these are very ... children's, uh, summer camps, where we group them together
Episode duration: 3:21:50
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Transcript of episode 8RsrifYHZeI
