Lead Story

Is Patu Keswani's back-up plan hospitable enough?

Premium midscale chain, Lemon Tree, may be among the few that could survive when the dust settles down 

Vishal Koul

After losing 97% of his money two decades ago while trading in stocks, Patu Keswani learnt to never bet the bank. And more importantly, to always have a Plan B, Plan C and Plan D. But sometimes, all your contingency plans cannot make up for the disruption unleashed by a pandemic; especially, if it spooks the biggest influencer. For Dalal Street, it is foreign institutional investors. They have always swung the momentum with their hefty dollar investments. While their presence can attract more cool kids from the neighbourhood, their spurning can burn. So, when they sold nearly $8.5 billion worth of equity in March and April, many — including mid- and small-caps — were left bruised, with their valuations completely decimated. None of Keswani’s plans (B, C or D) seemed to have worked.

Editor's Note

Why Lemon Tree is unlikely to be a lemon

Patu Keswani’s agility in managing the business along with its positioning should help the midscale chain overcome these extraordinary times

While COVID-19 has wreaked havoc on a lot of businesses, none has been hurt as much than the travel and hospitality business. Given that people were literally locked up meant that these businesses bore the brunt of the pause in spending. And it is not as if the situation is back to normal now and these businesses are set to recover what they have lost in potential revenue and opportunity. The existing fear psychosis of infection means that it will be a while before people really start living their lives like they did in the pre-Covid era.