EIH chairman and chief executive P. R. S. Oberoi (sitting left) and vice-chairman and managing director S. S. Mukherji (standing centre) in Calcutta on Wednesday. Picture by Kishor Roy Chowdhury

Calcutta, July 27: EIH Limited will concentrate on management contracts and is no longer keen on equity participation for its projects.

?We plan to undertake several new projects both at home and abroad. However, we will opt for management contracts of properties with little or no equity participation,? chairman and chief executive P. R. S. Oberoi said on the sidelines of the company?s annual general meeting.

?We have invested substantially in real estate and must strike a balance. Therefore, we have decided to change our strategy by concentrating on management contracts,? added Oberoi.

The company plans to establish its presence in Thailand, Cambodia and Dubai. ?Properties in these countries will be purely managed with a marginal investment of 10-15 per cent, if required,? said Oberoi.

?We expect to announce our projects this fiscal and are tying up with people who own the land and will develop the hotels from scratch,? he added.

Back home, the company has undertaken to manage a 175-room property in Gurgaon. ?Though the total investment in the project is Rs 275 crore, we are not participating in the equity,? he said.

At present, the company is developing its Bandra-Kurla property at an investment of Rs 600 crore. The five-star deluxe hotel with 450 rooms will be operational latest by December 2007. The company has already invested Rs 300 crore in the project.

?We are developing a property in Bangalore. We have already acquired the land and appointed an architect about a month ago,? vice-chairman and managing director S. S. Mukherji said. The investment in the project is Rs 250 crore. Both the Gurgaon and Bangalore projects should be operational in three years.

The company also plans to expand its Trident brand both within and outside the country. ?We will establish this brand in cities where the Oberoi hotels are already present or places where the Oberoi brand will not work,? said Oberoi. EIH is scouting for properties in Hyderabad, Delhi, Calcutta, Pune and Ahmedabad.

In the first quarter of the current fiscal, the company has registered a profit of Rs 17.06 crore compared with a loss of Rs 4.69 crore in the year-ago period. The operating profit has increased by 83 per cent to Rs 42.81 crore from Rs 23.34 crore in the corresponding quarter last year.

The total income was Rs 155.67 crore, a growth of 28 per cent from Rs 121.58 crore in the year-ago period.

?We expect the results for the next few years to be the best than the last decade,? said Oberoi.

The Oberois plan to use the creeping acquisition route to step up their holding from the present level of 47 per cent to over 50 per cent. The promoters have picked up a 3.66 per cent stake from UTI-I on July 13 to strengthen their holding.