15. Creating Wellness Tourism Facilities at multiple locations · Examples include Trivago and OYO...

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Creation of Wellness Tourism Facilities at Multiple Locations Tourism Government of Gujarat

Transcript of 15. Creating Wellness Tourism Facilities at multiple locations · Examples include Trivago and OYO...

Page 1: 15. Creating Wellness Tourism Facilities at multiple locations · Examples include Trivago and OYO Rooms. Page 6 Gujarat - Competitive Advantage Learning and Operational Infrastructure

Creation ofWellness TourismFacilities at MultipleLocations

TourismGovernment of Gujarat

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Contents

Project Concept 3Market Potential 4Growth Drivers 5Gujarat – Competitive Advantage 6Project Information 7- Location/ Size

- Infrastructure Availability/ Connectivity

- Raw Material/ Manpower

- Key Players/ Machinery Suppliers

- Potential Collaboration Opportunities

- Key Considerations

Project Financials 10Approvals & Incentives 13Key Department Contacts 15

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Project Concept

Wellness Tourism

Wellness tourism involves people who travel to a different place to proactively pursue activities thatmaintain or enhance their personal health and wellbeing, and who are seeking unique, authentic orlocation-based experiences/therapies not available at home

Wellness travellers pursue diverse services� Spiritual needs

� Beauty treatments

� Healthy diet and weight management

� Relaxation and stress relief

Purpose of wellness tourism

Wellness travellers may seek procedures or treatments using conventional, alternative,complementary, herbal, or homeopathic medicine.

� Hotels and Hospitality

� Hospitals and Medical Centers

� Resorts and Retreats

� Environmental purpose

� Social purpose

� Health-related education.

Wellness Tourism and Medical Tourism Market Spectrum

IntegrativeHealth

Centers

ResortSpas

Eco-Spas

AshramsYoga/ Spiritual

RetreatsWellnessTourism

MedicalTourism

Locationbasedexperience

Genericexperience

BeautyClinics

Gyms

WellnessCruises

MedicalSpas

CosmeticSurgery clinics

Dentalclinics

Hospitals

ThermalBaths

Thalasso-therapy Spas Ayurvedic

ClinicsTraditional

Chinese MedicineCenters

Hotel/ DaySpas

Types of wellness tourism

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Market Potential

With a 17.7% growth in leisure tourism y-o-y coupled with government’s push to promotewellness tourism, Gujarat is best positioned to be the next wellness hub of India

* includes both products and services

AYUSH – Department of Ayurveda, Yoga and Naturopathy, Unani, Siddha and Homoeopathy

INR490 bn*

Indian wellnessmarket (2014)

INR120 bn

AYUSH sectorturnover (2014)

736,538

AYUSHregistered

practitioners(2014)

8.03 m

Foreign touristsarrival in India in

2015

Share ofwellness

services(2014)

40%

India’s wellness tourism market is expected to surpass US$18 billion by 2019, clockingover 20% gains annually through 2017

India- Market Potential

19.2

10.2

2.4

Business

Spiritual

Leisure

Tourist flow 2014-15 (in millions)

The gross tourist flow in Gujarat duringthe year 2014-15 was ~32.6 million out ofwhich ~8% travelled for leisure purpose

Gujarat- Market Potential51

Ayurvedahospitals

16Homeopathy

hospitals

34,833AYUSH registered

practitioners

Naturopathy centres:� Navjivan Nature Cure Centre, Kutch� NIMBA Nature Cure Village, Mehsana

16Homeopathy college

11Ayurvedic college

Drivers of Wellness Tourism in GujaratPolicy support� The government of Gujarat has decided to

give industry status to tourism sectorimplying it would get the same benefitsgiven to only industries, such as loaninterest subsidies, concessions in taxesas well as in electricity duty

� Health resorts offering AyurvedicTreatments like the Panchkarma Therapyand other treatments would be developedand suitably incentivised through aseparate government resolution.

Availability of Ayurvedic products� Gujarat is a pharmaceutical

manufacturing hub with ~20% Ayurvedicmanufacturing units spread over fourclusters – Ahmedabad, Vadodara,Ankleshwar and Bharuch & Vapi/ Valsad.

� At least 25-30 companies including smalland mid-sized pharmaceutical firms haveeither started making such products or arein the process of developing them.

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Growth Drivers

Improvedinfrastructure

� The GoI has made efforts to improve and upgrade infrastructurefacilities at important tourist destinations, thereby, improvingaccessibility

� FY16 Union Budget allocated INR14.8 billion toward infrastructuredevelopment for destination and circuits, domestic / overseaspromotion and publicity

Increase intourist

movement

� Rise in foreign tourist arrivals (FTAs) and tourist movement within thecountry has driven growth in the hospitality industry. The number ofFTAs reached 7.4 million in 2014, up 27.6% from 2010

� India is known as a destination for spiritual tourism and also offerscruises, adventure, medical, wellness, sports, film, rural and religioustourism. Medical tourists inflow is estimated to be 320 million in 2015,up from 85 million in 2012

� Travel and tourism is the third largest forex earner for India, whichcontributed US$19.7 billion in 2014

Policy support

� Campaigns such as Khushboo Gujarat Ki, Incredible India, Athithi DevoBhava launched to harness the tourism industry’s potential

� FDI under the automatic route in tourism and hospitality is allowed upto 100%, subject to applicable regulations and laws

� Capital subsidy programme for budget hotels� Introduction of ‘Medical Visa’ for tourists coming into the country for

medical treatment� Exemption of Fringe Benefit Tax on crèches, employee sports and

guest house facilities

Trends in Indian hotel industry

Emerging budgethotels

� There is a rise in the concept of budget/no frill hotels which offer smartbasic services at an affordable price

� Examples include Ginger, Lemon Tree and Red Fox Hotels

Apps for weband mobile

based booking

� Online and mobile based booking is picking up in hotel industry withthe emergence of companies such as Make My Trip, Yatra, Cleartrip,Goibibo and ixigo

� It is estimated that ~8.4 million Indians will book hotels online by 2016,up from 3.5 million in 2014

Growingaggregators sites

� There are sites that compare the results from all these sites to providecheapest booking options to the customers

� Examples include Trivago and OYO Rooms

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Gujarat - CompetitiveAdvantage

Learning andOperationalInfrastructure

Policy support

Initiatives topromotewellnesstourism

There are 33 AYUSH teachinginstitutions in the state and34,833 AYUSH registeredpractitioners

The department of Ayurveda,under AYUSH, was started inGujarat in 1960

There are 33 speciality Ayurveda hospitals in different parts ofGujarat, with 1345 bed capacity available for patients

The government of Gujarat hasdecided to give industry statusto tourism sector

Due to the industry status, thetourism sector would get thesame benefits given to onlyindustries, such as loan interestsubsidies, concessions in taxesas well as in electricity duty

Health resorts offeringAyurvedic treatments like thePanchkarma Therapy and othertreatments would be developedand suitably incentivisedthrough a separate governmentresolution.

As part of its strategy toincrease connectivity in thestate and boost tourism to thestate, Gujarat State AviationInfrastructure Company Limited(GUJSAIL) is developing 11airstrips across the state

GoodGovernance

The state is one of the leastcorrupted in the country with ananti-corruption index of 0.69

Gujarat leads in projectclearance in coastal areas witha success rate of 93%

Geography The southern part of Gujaratruns along the Arabian sea.It’s northern region houses theThar desert.

The state has longest coastlineamong all states in India -1,600kmss. There are numerousbeaches along the coastlinewith flora and fauna, templesand recreational facilities

Gujarat has the country’s finest infrastructure and is politically most stable

Medicinal Herbs Gujarat has 1315 recorded species of medicinal value. Theseinclude 754 herb species, 248 tree species, 165 shrubs and 148climbers. 1016 plant species are wild where as 299 species arebeing under cultivation or plantation

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Project Information

On the basis of connectivity and the prospects the region offers, few locations have beenidentified as prospective wellness tourism sites

Saputara/Dangs

Nalsarovarlake

Narmadadistrict

Poloforest

Site Location

This district is famousfor "Narmada River"and temples at the bankof the river

Ratanmahal Sloth BearSanctuary,Shoolpaneshwar WildLife Sanctuary etc arefamous wild lifesantuaries in the city.

Saputara is the only hill station in Gujarat,located at a height of 1000 metresIt has hill resorts, a museum, sunsetpoint, valley view, a lake

Around 520 out of the 1,100 medicinalherbs listed in the pharmacopia ofAYUSH are found in SaputaraAmong them, majpr herbs are amla,harde, bherda, satavari, aswagandha,sarpagandha and tubers and roots whichare crucial for ailments of chronic nature

Polo forest is an eco-touristplace located near Abhapurvillage of Vijaynagar taluka;around 150 kms fromAhmedabad

There are 450 species ofmedicinal plants. ~21 plantspecies found in Vijaynagar areprimarily used for hair care

The Nal region is a low-lyingarea between the plains ofthe Central Gujarat andEastern SaurashtraNal Sarovar Bird Sanctuary,consists of a 120.82-square-kms (46.65 sq mi) lake andambient marshesThe lake attracts over 210species of birds

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Project Outline

Project components

CottageSwimmingpool

Shower/Changingroom

MassageandTreatmentRooms

Sauna andSteam Bath

FitnessRoom

Yoga andMeditationHall

RecreationRoom withIndoorgamingfacility

Restaurant

KitchenStaffAccommodation

Open andLandscapedArea

Treatments/ Therapies already provided in Gujarat

Naturopathy Therapy Massage, Hydro, Mud, ChromoTherapy and others

Disorders treated:- Asthma, Anemia,Back Pain,Depression,Diarrhea, HypoTension, Insomnia,Jaundice, Obesity,Vertigo, Anxiety,RheumaticArthritis etc

Ayurvedic Therapy Panchakarma, Abhayanga, Janu Basti,Kati Basti, Sirodhara.

Yoga & Meditation Centre Pranayam, Bandhas, Mudras,Meditation, Reiki

Physiotherapy and Cardio Gym

Special Therapies Swedish Massage, Hot StoneMassage, Refloxology, Raaga (Music)Therapy, Thai Massage.

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Project Information

Air

PortPoPPoPoPoPPoPPPoPoPPoPP rtrtr

Road

Rail

Water

Power

Utilities

Logistics & Connectivity

Infrastructure availability / connectivity

Saputara NarmadaNalsarovarPolo Forests

Bilimora is thenearest railwaystation. Waghai is52 kms fromSaputara

Udaipur(120km),Gandhinagar(140kms),Ahmedabad(160kms)

The nearestrailway station isat Ahmedabad (60kms.)

There are 4railway stations inNarmada

Bus facility isavailable fromChikhli, Bilimora,Nasik and Surat

Udaipur (120kms)and Ahmedabad(160 kms) and isaccessible by theNH8

Ahmedabad is60kms fromNalsaorvar. Statebuses run everyhour

Major state roadsconnecting toAhmedabad (195kms), Surat (83kms),

Surat Airport is thenearest, 172 kmsaway

Udaipur (120kms), Ahmedabad(160 kms),Vadodara (260kms)

Ahmedabad (60kms) is thenearest airport

Nearest airportsare in Surat andVadodara

Magadalla is161kms andHazira port is184kms fromSaputara

Sanand isconnected to threeports – Kandla,Mundra & Pipavav.

Dahej andMagadalla port arethe nearest portsto the district

Gujarat has a state-wide “water supply grid” spread across 1,20,769 km that aims toserve 75% of Gujarat’s population.

Gujarat boasts of 24 hour – 3 - phase uninterrupted power supply

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Project Information

Estimated Manpower Requirement

Manpower requirement at the site (Employees per 100 rooms)

Admin / Accounts 10

Sales & Marketing 3

Manpower numbers have beentaken basis a 5-star hotel

Centre level Corporate

Support Staff

Front Desk 5

Housekeeping 58

Maintenance 5

Other Service (Security/ Laundry) 5

Food and Beverage Kitchen 40

Food and Beverage Service 32

Purchase/Store 2

Therapists and Doctors

Spa Therapist

Senior Therapist 20

Trainees 34

Specialist Consultants 16

Roles

Leading Players

National Accreditation Board for Hospitals and Healthcare providers (NABH) accreditedwellness centres are:

VLCC HealthcareLimited,

Gurgaon, Haryana, India

GRT Bodhi Spa,Radisson Blu Hotel GRT ,

Chennai, Tamil Nadu, India

Complimentary & AlternativeMedicine Department,

Saifee Hospital , Mumbai,Maharashtra, India

Kairali AyurvedicHealing VillagePalakkad, Kerala

Otherplayers

Soukya Holistic HealthCenter

Bangalore, Karnataka

Source: NABH

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Project Financials

Proposed Product Mix

Facility Required area(square feet)

Cottages 20,000

Swimming Pool 4,035

Changing Rooms andShowers

650

Massage andTreatment Rooms

1,560

Sauna and Steam Bath 753

Yoga & Meditation Hall 1,000

Fitness Room 807

Recreation Room withIndoor gaming facility

1,000

Facility Required area(square feet)

Restaurant 1,681

Kitchen 1,614

Staff Accommodation 819

Common Toilet Block 274

Admin Area 500

Circulation Area 8,673

Parking Area 21,251

Open and LandscapedArea

5,88,782

Revenue and Utilisation Assumptions

Revenue per Cottages INR 5,500 per day

Annual Increase in Cottage rent 5%

Revenue from Food and Beverages 15% of the revenue from cottage

Revenue from Spa facilities 20% of the revenue from cottage

Realisation of revenue Operational year

1 2 3 4 5 onwards

Occupancy of Cottages 20% 40% 50% 60% 70%

An illustration depicting estimated cost of setting up a wellness centre spread over an area of5,80,000 squarefeet , with cottages spread over 20,00 square feet and 5,00,000 square feet of openand landscaped area

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Project Financials

Estimated Project Cost

Site Development INR 200 persquare feet

Civil Work INR 1,200 persquare feet

Cost of Furnishing INR 2,000 persquare feet

Cost of Machineryand Equipments

INR 5 million

Cost of construction

Project DevelopmentCost

@1% ofConstruction cost

Debt Syndication @0.5% of Debt

Equity Syndication @0.5% of Equity

Other pre-operationalexpenses

@1% ofConstruction cost

Pre-Operative Charges and Contingencies

Insurance duringConstruction

@0.5% of the landed cost foreach of the Construction years

Consultancy @5.5% of the Landed Cost

Launch marketing @1% of Construction cost

Interest duringconstruction

@14% of per Annum

Operating & Maintenance CostAssumptions

Marketing & Brokerage @1. 5% of thetotal revenue

Maintenance of Built-up Area,Machinery and Equipments

5% of the CapitalCost per Annum

Maintenance of LandscapedAreas

3% of the CapitalCost per Annum

Raw Material Cost for F&B 60% of therevenue from F&B

Raw Material Cost for SpaFacilities

40% of therevenue from SPA

Annual Inflation 5%

Total estimated cost

Construction Cost INR 274.4 million

Pre-operative Expenses INR 61.3 million

Total Landed Cost of the Project at Each Location INR 335.8 million

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Project Financials

The project is to be completed and funded on Direct private sector investment basis

Project Structure & Implementation Model

Government authority Project consultant

Government releases an RFP to the empanelled list ofconsultants for Project Consultant role

The consultant undertakestechno-economic feasibility

study and master planpreparation; assists with bidprocess management and

partner selection process; andacts as a project management

consultant during theimplementation period until

one year of commercialoperations

Private investor(project developer)

The developer will create suitablefacilities at the site mentioned

considering site specificenvironmental and relevant factors

Government selects theprivate player through

competitive biddingprocess and enters into anagreement to form an SPV

SPV

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Approvals andIncentives

� Registration as commercial establishment with the required state/district authority� Gujarat Infrastructure Development Board� ‘No Objection Certificate’ from the Gujarat Pollution Control Board� Environmental Clearance (EC) from Ministry of Environment and Forest (MOEF)

Approvals Required

Government of Gujarat has granted Industry status to Tourism sector thereby providing a greatboost to the industry. The incentives under Tourism Policy for the State of Gujarat (2015-2020)shall be applicable to the eligible tourism units as mentioned in the next sections.

Capital Subsidy to the Eligible Tourism UnitsEligible Capital Investment (excluding land cost) Admissible

subsidyMaximum limit

Investment upto INR500 million 15% INR75 million

Investment above INR500 million 15% INR100 million

Tented accommodation (with minimum investment ofINR2 million) 20% INR1.5 million

Equipment worth INR10 million and above for adventure& water sports 10% INR5 million

Additional Capital Subsidy of 5% for New Tourism Units� Within the Corporation limits of Gandhinagar and falling within the radius of 20 kms.� Owned and managed by women entrepreneurs (with minimum equity participation of 51% in

the entity)� SC/ST categories to an additional 5% subsidy over and above the ‘Admissible Subsidy’.

Incentives from Government of Gujarat

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Approvals andIncentives

Other Exemptions� Luxury Tax - 5 years from the date of commencement of commercial operation� Entertainment Tax - 5 years from the date of commencement of commercial operation� Electricity Duty - 5 years from the date of commencement of commercial operation for New

Tourism Units only.� 100% reimbursement of stamp duty and registration fee on sale/lease/transfer of land for the

first transaction only.

Interest subsidy to the eligible tourism units� @5% of the loan amount with maximum amount of INR2.5 million per annum for a period of

five years in Municipal Corporation areas for eligible tourism units

� @7% of the loan amount with maximum amount of INR3.0 million per annum for a period offive years in the areas other than mentioned above.

Incentives from Government of Gujarat

Special Package for Mega Tourism UnitsThe State Government shall duly promote and facilitate Mega Tourism Projects that have a largemultiplier effect on the economy, leading to employment generation and inclusive growth in theState. Any type of Mega Tourism Units like Film City, theme parks, amusement parks, waterparks, etc. meeting the qualifying criteria of Mega Tourism Units will be eligible.

Following incentives would be offered to eligible Mega Tourism Units:

� 100% reimbursement of stamp duty and registration fee on sale/lease/transfer of land for thefirst transaction only. Reimbursement of stamp duty and registration fee would be done afterthe commencement of commercial operations.

� Capital subsidy of 15% of eligible capital investment (excluding the cost of the land) subject toa ceiling of INR200 million.

� Exemption from luxury and entertainment tax for a period of seven years from the date ofcommencement of commercial operations.

� Exemption in electricity duty would be for a period of five years from the date ofcommencement of commercial operations.

� Mega tourism units shall not be entitled to any interest subsidy.

Support for Sustainable Tourism� Assistance to eligible tourism units up to 75% of the cost of carrying out Energy Audit by a

recognized institution/consultant, Water Harvesting / Conservation and Environment-friendlypractices like Green Buildings, Solar and other Renewable Energy measures

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Tourism Corporation of Gujarat Ltd,H. K. House, Opp: Bata Showroom,Ashram Road, Ahmedabad,Tel: +79 26578044/46/26589172Fax: +79 26582183E-mail: [email protected]

Tourism Corporation of Gujarat Limitedhttp://www.gujarattourism.com/

iNDEXTb - Industrial Extension Bureau

Industries and Mines Department, Gujarat

www.indextb.com

www.imd-gujarat.gov.in/

Department of Tourism, Gujarat

http://www.gujarattourism.com/

This project profile is based on preliminary study to facilitate prospective entrepreneurs to assess a prima facie scope.It is, however, advisable to get a detailed feasibility study prepared before taking a final investment decision.