Final SWOT & IE MATRIX

SWOT MATRIX
Internal

Harmful

Strength

Weakness

1. Pan India Presence

2. Employee retention
3. Constant Innovation
4. Highest market
capitalization
5. Brand Name

Externa
l

Helpful
1.
2.
3.
4.

Opportunities
1.
2.
3.
4.
5.

Economies of scope
Growth of Hotel Industry
Foreign tourist arrivals
High domestic spendings
Government Initiatives

Limited world wide presence

Declining revenues
Low operating performance
Limited financial leverage

Threats
1.
2.
3.
4.
5.

Growing Competition
Lack of skilled Labours
Growing Utility Costs
High Tax structure
Governments Red-tapism

Strengths

Pan India Presence

Operates in 63 locations
108 Hotels in India
More hotels in Major cities like Mumbai, Chennai, Bangalore
etc.
17 International Hotels includes Dubai, Singappore, US, UK etc.
http://www.tata.co.in/company/profile/Indian-Hotels
http://en.wikipedia.org/wiki/Taj_Hotels_Resorts_and_Palaces#c
ite_note-The_Tata_Group-8

Strengths
Employee Strength and HR Practices
Over 13,000 employees
Reward & recognition : Special Thanks and Recognition System (STARS)
for customer delight .
The Taj Group Wins Hermes International Hospitality Award in Paris
for HR practices
"STARS" programme voted as the "Best Innovation in Human Resources
Low Employee cost percentage compared to other Competitors
http://www.forbes.com/sites/kevinkruse/2012/10/08/employee-recognition/
http://www.moneycontrol.com/stocks/marketinfo/emc/bse/hotels.html
tajstars.tajhotels.com/hermesaward.html

Strengths
Constant Innovation
Taj pioneered some well known brands in Indian
Hotel Industry.
Some well known Ventures: -

Taj SATS - largest airline catering service in

South Asia, as a joint venture of IHCL and
SATS
Taj Yachts - has two three bedroom luxury
yachts
Taj Air - Taj Air, an air charter company
http://www.tata.co.in/company/profile/Indian-Hotel
s

Strengths
Market Leader
Considered to be the most premium hotel brand in India.
Highest in terms of Market Capitalization in INDIA
Highest in terms of Total assets in INDIA

http://www.moneycontrol.com/stocks/marketinfo/emc/bse
/hotels.html

Strengths
Brand Name :

Top of the mind brand recall in Hotel industry

Ranked among the Top 100 Hotels and Resorts in the World
13 in the list of Gold Standard Hotels, in 2014
Vivanta by Taj has been voted the 3rd Best Hotel Brand
globally, at the Conde Nast Traveller's 16th Annual Business
Travel Awards

Recipient of World Branding Awards 2014-2015

WBA, a global non-profit organisation dedicated to advancing branding
standards for the good of the branding community

http://
www.moneylife.in/business-wire-news/state-bank-of-india-and-taj-hotels-resorts-palaces-winners-at-world-branding-awards/4
3186.html
http://en.wikipedia.org/wiki/Taj_Hotels

Weakness
Limited world wide presence

Over dependence on Indian sub continents

Have Just 17 Hotels only Outside India
Ratio of Rest of world to India is 1 : 6
No Hotels in world Tourist destinations such as Rom,
France etc.
No focus on worlds commercial hubs like Dubai (Just One
Hotel)

http://en.wikipedia.org/wiki/Taj_Hotels#Hotels_outside_India
http://www.tata.co.in/company/profile/Indian-Hotels

Weakness
Low operating performance
Reduce investors confidence
Negative impact on the company's growth
prospects
The company reported operating loss of
US$62.3 million in FY2014.
The ROE of -14.4% (2014) is less than 1% in
2013
http://
www.moneycontrol.com/stocks/marketinfo/opera
tingprofit/bse/hotels.html

Weakness

Weakness
Limited financial leverage
Weak solvency position of the company
Impact the credit worthiness and buiness
operation.
debt-to-equity ratio of 1.3 at the end of FY2013
In 2013, 13.1% increase in debt to US$785.4
from US$694.6 million,

http://www.moneycontrol.com/stocks/marketinfo/netprofit/bse/hotels.html

Opportunities
Economies of Scope:
One Luxurious brand for different sets of
customers
Taj group started organizing its hotels into different
brands to suits different segmented customers (Luxury)

More vareities :

Taj Exotica (Luxury resorts)

Taj Safaris (Eco-tourism)
Vivanta (Business and Vacation destination)
The Gateway Hotels and Resorts ( Budget Hotels)
Taj/Taj luxury (Heritage/Luxury Hotels)

Opportunities
Positive outlook of Hotel Industry
USD5.3 billion in 2011 and to be $23 billion
2015
The hotel market is expected to double in size
by 2018. (i.e. $46 Billion)
$12 billion (Rs 59,442 crore) is likely to be
invested in the next two years.

http://
www.business-standard.com/article/management/kit-the-indian-hospitality-industry-109051200
037_1.html
http://www.ibef.org/industry/tourism-hospitality-india/showcase

Opportunities
Foreign tourist arrivals
Foreign tourist arrivals increased at a CAGR of
7.2 per cent during 200514
By 2024, foreign tourist arrivals are expected to
increase to 13.42 million,
India ranks 18th in business travel (World tourism and travel
council)

Expected to enhance the top line performance of

the company

http:// www.ibef.org/industry/indian-tourism-and-hospitality-industry-analysis-presentation

Opportunities
High Domestic Spending on
leisure : 53 % of Hotels revenue comes Domestically.
Young population in Metro cities
Boom of IT (Online Booking) and business
travels.

http://www.ibef.org/industry/indian-tourism-and-hospitality-industry-analysis-presentation

Opportunities
Government Initiatives
100 per cent FDI was allowed through the
automatic route
Promotion by Government, India as a Tourist
destination.
Incredible India, Athithi Devo Bhava

Sanction of Tourist VISA to 180 countries as

of Aug 2014.

http://www.ibef.org/industry/indian-tourism-and-hospitality-industry-analysis-presentation

Threats
Growing competition
Heavy Competition from Leela groups,EIH, ITC etc.
International practices of Peer competitors
Competition from Internationally.
As of 2013 , More than 50 50 international budget
hotel chains moved into India
http://
www.indianmirror.com/indian-industries/hotel.html
http://
www.hospitalityindia.com/hospitality-industry-in-indi
a.htm

Threats
Starwood Hotels & Resorts
announced 65 operational properties by end of 2015 in
India.

Kempinski
plans to operate 3 new hotels in India by 2020.

InterGlobe Hotels
in Delhi with plans to have 19 ibis hotels by end of 2016

Lemon Tree Hotel Company

plans to invest around Rs 4,500 crore

http://www.ibef.org/industry/tourism-hospitality-india.aspx
References:Media Reports, Ministry of Tourism, Press Releases, Department of Industrial
Policy and Promotion (DIPP)

Threats
Shortage of Skilled Labour.
Boom of IT, Banking leads hospitality unattractive
No SOP followed by Indian Tour guides, Managers
etc.
Unattractive packages lead to employees
volatility.
Indias focus on white collar jobs
Personalized services are can not be automated.

http://www.naukrihub.com/india/hotels/overview/challenges/

Threats
High Tax Structure
10 % in 201o, 12% in 2013, 14% in 2015
At least 12% tax on Luxury hotels.
Various other levies also been Hotels with
ACs, other cessations etc.

http://www.tajhotels.com/Luxury/PDF/Factsheets/NewTariff.pdf
http://www.goacomtax.gov.in/salestax_taxrate_disp.php?cid=4

Threats
Growing Utility Taxes: Energy Cost, power supply varies from state to
state
Growing Land cost impede investments
http://
www.moneycontrol.com/stocks/marketinfo/pfc/bse/hotels.
html

http://www.hotelnewsnow.com/article/9735

Threats
Governments Red tap:
Any given hotel project requires 70 to 120
permits
Anomaly in obtaining licenses.
Land clearances, Environmental clearances
Political unrests
The occurrence of swine flu, SARS, flu epidemic
has resulted in a decline in the number of
tourist.
http://www.hotelnewsnow.com/article/9735

Inter
nal

Helpful

Harmful

Strength

Weakness

1. Pan India
Presence
2. Employee
retention
3. Constant
Innovation
4. Highest market
capitalization
5. Brand Name

Exte
Opportunities
rnal

1. Economies of
scope
2. Growth of Hotel
Industry
3. Foreign tourist
arrivals
4. High domestic
spendings
5. Government
Initiatives

1. Limited world
wide presence
2. Declining
revenues
3. Low operating
performance
4. Limited financial
leverage

Threats
1. Growing
Competition
2. Lack of skilled
Labours
3. Growing Utility
Costs
4. High Tax structure
5. Governments
Red-tapism

Internal facors
S.No

Internal factors

1
2
3
4
5

Strength

1
2
3
4

Weighta
ge
Rating

Score

Pan India presence

20

0.8

Employee strength

0.36

Constant innovation

10

0.4

Market Leader

10

0.3

Brand Name

0.24

Weakness

Limited world wide presence

10

0.2

Declining revenues

14

0.28

Low operating performance

10

0.3

Limited financial leverage

0.27

Total

3.15

External factors
Weightag Ratin
S. No

1
2
3
4
5

1
2
3
4
5

External factors
e
Opportunities

Score

Economies of scope

13

0.52

Growth of Hotel industry

14

0.42

Foreign tourist arrivals

0.24

High domestic spending

10

0.3

Government initiatives

10

0.3

Threats

Growing Competition

15

0.45

Lack of skilled labour

0.15

Growing utility Cost

10

0.2

High Tax structure

10

0.1

Government red tape

0.21

Total 2.89

IE Matrix (IFE & EFE)