[photopress:Olympic_gold_medal_xx.jpg,full,alignright]Standard & Poor’s Equity Research has identified the international hotel groups that it expects will take home from the China Olympics the gold medals for the amount of guests who stay and, as an extension the profits that will be made. With less than 500 days to go the excitement is beginning to mount.
Start with a base figure which is that Beijing is expected to receive about 500,000 to 550,000 overseas visitors as it hosts the summer Olympics.
S&P’s Pearl Wang, writing in US Business Week, says China has the largest development pipeline for hotels in the world after the United States. Lodging Econometrics states that China’s room count is 63% of all the rooms in the Asian pipeline.
Pearl Wang notes:
‘Today in China there are about 5,000 hotels with star ratings, holding about 701,700 available rooms. In comparison, the U.S. has about 50,000 hotels. This suggests to S&P that the market in China appears to have a lot of room for growth. How much? It’s hard to say. By way of comparison, the U.S. hotel industry has annual revenues of about $90 billion.’
So who are the ones to follow? S&P believes one good investment opportunity lies with InterContinental.
S&P equity analyst William Mack said ‘InterContinental is among the three largest hotel companies in China. The company is expanding its China brand presence — in terms of number of rooms — by about 20% a year,’ The company has more than 55 hotels in China, most of which are managed or franchised. InterContinental plans to have about 125 hotels by 2008; many will be Holiday Inns.
Other winners identified by S&P are Hilton Hotels, Marriott International, and Starwood Hotels & Resorts. Other U.S industry players making strides in China are Best Western, which will have around 25 hotels by the end of this year, and Wyndham.
Source: Travel Mole
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