SAMHI Hotels announced its strategic investment to acquire a 70% majority stake in RARE India, an established leisure platform, on March 6, 2026. The total investment is capped at approximately INR 47 crores (INR 470 million) over 12 months. This move marks SAMHI’s first scalable entry into the experience-led leisure segment, positioning RARE for an affiliation with Marriott Bonvoy’s Outdoor Collection.
SAMHI’s Strategic Entry into Leisure Hospitality
SAMHI Hotels Limited held a Business Update Conference Call on March 06, 2026, to discuss the acquisition of a 70% stake in RARE India. Managing Director and CEO, Mr. Ashish Jakhanwala, highlighted that this transaction is strategic and asset-light, involving a total investment limited to about INR 47 crores (INR 470 million) over the next 12 months via primary and secondary transactions.
RARE India, founded in 2003/2004, supports over 60 small, experience-led hotels with roughly 990 rooms across 15 states in India, Bhutan, and Nepal. The investment is transformational because it provides SAMHI entry into the high-growth leisure segment using an asset-light model, enabling platform scaling without requiring significant future capital expenditure.
Rationale for the Acquisition
Mr. Jakhanwala outlined several compelling reasons for the deal:
- Leisure Segment Growth: The experience-led leisure segment shows phenomenal growth and strong pricing power, especially for smaller, curated hotels.
- Asset-Light Model: This is SAMHI’s first asset-light investment, allowing scale without material capital expenditure post-initial funding.
- Legacy and Team: RARE has a 20-year legacy, a respected founder (Shoba), and a committed team, allowing SAMHI to focus on its core business of tier-one business hotels.
- Valuation Basis: The acquisition is based on transformation value, not backward-looking earnings. The total enterprise value agreed is INR 49 crores for 100% of the current business, implying an entry price of about INR 4.5 lakhs per room.
The Marriott Affiliation
A key component of the deal is the proposed affiliation with Marriott. Post-investment, RARE will be appointed as Marriott’s exclusive portfolio platform for the Outdoor Collection by Marriott Bonvoy in India, Nepal, Bhutan, and Sri Lanka. This affiliation is expected to drastically improve distribution, visibility, and booking volumes for RARE’s properties.
The transition involves shifting RARE from its current B2B subscription/commission model to a B2C model, leveraging Marriott’s global distribution system. While RARE currently earns minimal B2C income (subscription fees range from INR 2 lakhs to 4 lakhs per hotel annually plus 18% to 20% commission on direct sales), the B2C integration is expected to be the real source of future revenue growth. SAMHI estimates a path to INR 90 crores to INR 100 crores in revenue from this portfolio within three to four years, driven by network expansion (targeting 120 to 150 hotels) and B2C income generation.
Future Strategy and Financial Outlook
SAMHI leadership confirmed that the primary focus remains firmly on tier-one business hotels, which are the main drivers of money for the company. The RARE investment is a strategic, adjacent, asset-light bet. Mr. Jakhanwala projected that even if this segment grows substantially, it would likely represent only 5%-7% of the group’s INR 3,000 crores top line by FY ’30.
Regarding current performance, RARE properties average an ARR of about INR 25,000 per night, with current overall occupancy ranging between 35% to 45%. The immediate goal post-integration is to leverage Marriott distribution to boost occupancy, potentially yielding a 15% to 20% upside just from distribution power alone.
The deal structure involves a primary investment of about INR 23 crores and a secondary purchase of about INR 24 crores, stitching together a pre-money valuation of INR 49 crores. The founders retain a 30% stake, prioritizing a strategic partnership with SAMHI and Marriott over purely maximizing the immediate headline valuation.
Source: BSE
