The OP Munjal-led Hero Group on Monday announced its foray in the hotels and hospitality sector with a Rs650 crore 5-star deluxe hotel in Gurgaon.
While Hero Group will develop the property, it will be managed by international hotel companies.
The group, which owns Hero Cycles, Hero Motors, Munjal Kiriu and ZF-Hero Chassis Systems, currently enjoys a debt free status with more than Rs1,000 crore free cash on its balance sheet.
The 280-room hotel will be commissioned in 12-months, Munjal said.
The corporate structure for the hotels division has yet not been finalised. "Most likely it will be executed through one of the group companies. It may be a division or even a subsidiary, but we have not decided on the exact organisational structure yet," Munjal said.
"Looking at the huge growth potential and dynamic social changes, we see a room for a high-end hotel in this part of the national capital region," he said.
He said the group, which recently exited from its joint venture with Japanese auto giant Honda and carved out a separate brand identity, has created a large land bank, primarily in Punjab, Haryana and UP.
"We will optimally utilise this land bank to push our hospitality business," he said. "We see the opportunity for growth in tourism is extremely high in India and this is the right time for us to venture into the sector."