Sri Lanka Taj unit expects strong demand

Sept 01, 2012 (LBO) – Taj Lanka Hotels, a unit of India’s Taj Hotels and Resorts is expecting strong demand for hotel rooms in the next few years despite a number of new properties coming up as tourism arrivals continue to grow. Chairman Raymond Bickson, told shareholders that expert forecasts indicate the demand for hotel rooms to outpace supply.

“Sri Lanka is set to change from a budget destination to a more exotic one offering a variety of experiences to a diverse segment of travelers,” he said.

Taj was also supportive of a state intervention to set minimum prices for a five star hotel, a move that has attracted criticism from some sections of the industry as it restricts their pricing freedoms.

To escape the rule, hotels have to avoid being classified as a ‘five star’ property.

The firm which operates a hotel in by the Galle Face beachfront in Sri Lanka’s capital Colombo reported profits of 124 million rupees in the year to March 2012, up from 99 million a year earlier, giving earnings of 89 cents per share.

The stock last traded at 27.60 rupees.

The profits came despite finance expenses surging to 97 million rupees from 20 million a year earlier due to exchange losses on a foreign loan as th