Cover story: Leisure Pays! [Pg 1]

COVER STORY
Leisure Pays!

With an entire generation of customers deciding that it's alright to pay for fun, entrepreneurs are realising that there's big money to be made in amusement parks, theme restaurants, up-scale shopping malls, golf clubs, bowling arcades, and multiplexes.

By Shamni Pande

Cut to a remake, circa 2000, of The Graduate and the boring gray suit could well take Benjamin Braddock aside at his (Ben's, not the suit's) graduation party and tell him that the future is in leisure. Not the kind of R&R that a certain Bertram Wilberforce Wooster would recommend, but, nevertheless, a member of the very family. Nor would the suit be wrong: there's a happening sort of atmosphere around leisure (not hard to digest once you accept the fact that leisure can be happening), one that comes with the kind of high normally associated with counting crisp notes that have just been spat out by a generous ATM. Which is only right when the subject of discussion is an industry that could be worth Rs 5,000 crore over the next three years. It's about fun, yes, but there's money in it too-lots of it.

See the young couple out on a bowling date? That'll set them back a cool Rs 600 for a couple of games, and that's not including refreshments. Spy the family at the local multiplex? They will end up spending a little more than Rs 1,000 on tickets and snacks over the next four hours. Spot the young banker-type at the links? His membership cost him Rs 2 lakh and the set of Wilson clubs his caddie is ferrying around, Rs 60,000.

Factors Spurring The
Leisure Business In India

GROWING affluence and increasing discretionary income in both urban and rural areas

EMERGENCE of customers open to the concept of spending on leisure activities

BOOMING organised retail formats that help create the ideal context for a leisure wave

ENTRY of established corporates that spy an opportunity in the leisure business

Suddenly, leisure isn't a laid-back day-at-the-beach kind of industry. It's big business. And where there's business, there are consultants. Like Uttam Dave, who runs PKF Consultants, a Delhi-based (what else) leisure-consultancy, who steps in to define the L-word: ''Traditionally, recreation in India revolved around reading, watching the telly, and visits to the park. Today, this is shifting to a more experiential level where leisure and recreation are more active and interactive in nature.'' Entrepreneurs and companies aren't blind to this fact. Over the next three years, they will invest Rs 2,000 crore in the business of leisure. And some 20 other companies will invest Rs 1,000 crore in building shopping malls, those leisure arenas of the future. Driving these investments are estimates of the size of the leisure market in India today. The Arthur Andersen-FICCI report puts the market at Rs 1,500 crore (family entertainment centres, a term that encompasses everything from amusement parks to go-karting rinks-Rs 400 crore; water parks-Rs 200 crore; coin-operated video games-Rs 700 crore; and others-Rs 200 crore). That's not counting theme restaurants, night clubs, and golf clubs. Predictably, everyone wants a piece of this action.

The Zee group is investing Rs 700 crore in 'Fun Republic' amusement centres that will come up in 15 cities including Mumbai, Ahmedabad, and New Delhi. And the Ahmedabad-based Citi Pulse group is investing Rs 100 crore in six multiplexes in Ahmedabad, Baroda, and Jamnagar. There are a dozen more instances, in as many cities, of companies and individuals investing in amusement parks, pubs, golf links, go-karting rinks, and water parks (a completely Indian concept of an amusement park where most of the 'a' is built around water rides), bowling alleys, pool bars, and the like. Nathan Andrews, CEO, Concept Solutions, a Mumbai-based consultant, sums it up best: ''We're seeing huge investments in brick-and-mortar leisure. These will bring in revenues from voracious consumers and, in turn, create employment and business opportunities like never before.''

If that's a little difficult to digest, chew on some numbers: like the 3,000 pool 'parlours' (that's what they call themselves) and 35 bowling arcades that have mushroomed across India over the past two years; or the four up-scale shopping malls and over a dozen water parks that have cropped up. Even as tony an activity as golf hasn't been spared: One estimate by Surjit Duggal, a Mumbai-based golf consultant and Chairman, Technical Committee, Indian Golf Union, places the number of people taking to the sport every year at 5,000, way above the 2,000 who used to tentatively drift into clubs two years ago. Waiting periods at the 50-odd clubs (read: courses) in the country-six of these have sprung up in the last year-go up to four years. Predictably, companies like ITC, DLF, Eagleton Golf Village, and Jaypee Group have gotten into the business of building courses. And the ripple-effect impacts things such as the sale of golf clothing and equipment. Dipak Agarwal of Sports Planet, a speciality up-market sporting goods store at the capital's premier shopping mall Ansal Plaza believes a store like his wouldn't have been a viable concept two years ago: ''Most people who buy golfing equipment from us aren't die-hard fanatics of the game. In most cases, these are the kind of people who like to spend Saturday mornings taking a swing.'' Only, they're now willing to pay a lot more for that.

Why play now?

GOLF: A membership at the most happening golf course in the city is the surest sign of success. Not surprisingly there's a huge waiting list at the 50 golf clubs in the country (there are 130 more courses but these are owned by the army-is the Ministry of Defence missing out on a great revenue opportunity here?). ''It's embarrassing to keep piggy-backing on friends who are members,'' says Ranjit Namjoshi, a professional golf instructor based in Bangalore.

However, the size of the investment required to enter the business of golf-
Rs 30-crore at the entry level-has ensured that few corporates ventured into this business. That's changing now, with the DLF Group and Jaypee Group putting up courses. However, right now, the emphasis is on clubbing real-estate with golf. ''The idea is to sell housing plots, have a resort, tennis, swimming pools, and even conferencing facilities that will attract families, as well as corporates who wish to tee off after work,'' says K.S. Chhachhi, General Manager, Eagleton-a company building a
Rs 150-crore golf plus villas facility outside Bangalore. And most companies hedge their bets by also targeting the lucrative golf-tourism segment. As the number of people taking to golf increases-it's already gone up three fold in the past three years-the domestic market is certain to boom.

It isn't as if an entire generation of well-heeled customers woke up one morning and decided, lemming-like, to go out and throw some money around on having fun. Economics is one reason: according to the National Council of Applied Economic Research (NCAER) the rich (definition: people belonging to households with an annual income of over Rs 1.40 lakh) number 50 million in urban India alone. Explains I. Natarajan, Chief Economist, NCAER: ''These people belong to households that have most consumer goods. Travelling abroad isn't an alien concept to most of them. They have the money and are willing to spend it on themselves.''

The growth in organised retail is another reason. Food courts and bowling arcades are natural complements to a shopping mall. The foot-fall at malls like Crossroads in Mumbai and Ansal Plaza in Delhi touches 30,000 during weekends, and hovers around a respectable 10,000 during the week.

The sheer potential for growth is the third reason. India boasts 13,000 cinemas for a population in excess of a billion; the US has 31,000 for a population of 265 million. And the leisure industry hasn't moved beyond the top rung of cities. With NCAER putting the number of rural-affluent (annual household income exceeding Rs 5 lakh) at 30 million, though, things are unlikely to stay that way. ''Smaller cities,'' says Vikas Kasliwal, the CEO of Landmark City, a S. Kumars Group venture in the family entertainment business, ''boast no leisure or entertainment facilities. We will see a 150-200 per cent growth in the leisure business in these places.''

Continues

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