BK Group a happy UAE travel and car leasing marriage

The BK Group chief executive Kulwant Singh talks about the merged entity's ambitions.

The UAE’s travel industry is gearing up for an upsurge in tourists as Dubai prepares to host World Expo 2020. The merger of the travel company Lama Group and the car leasing firm Carfare announced this week is a step in that direction. Lama and Carfare will retain their brand names but will operate as BK Group Holdings.

Here Kulwant Singh, the chief executive and managing director of BK Group Holdings, discusses the company’s plans:

Why is Lama Tours acquiring Carfare?

This is a merger between two hospitality groups that cater different products to the market, both the groups have their own areas of expertise, product knowledge and market share. If they both are merged, we will be able to widen our presence, increase our customers by an exchange, offer more products to the industry under one roof, reach a larger customer base and offer multiple products to existing customers. This will not only increase our gross targets but also buffer the bottom line.

What’s the total value of the deal?

The total value of the deal is worth Dh365 million.

You say the number of offices will increase to 23. Where are these offices?

Carfare has offices in Dubai Investment Park, Business Bay, Media City, Deira, Sharjah, Abu Dhabi, Ramada Bur Dubai, Ramada Jumeirah, Crown Plaza Sheikh Zayed Road and United Kingdom, while Lama Tours has four offices in Dubai, Abu Dhabi, Saudi Arabia, Kuwait, Mumbai, Delhi, Bangalore, Chennai and Jaipur in India and the Philippines.

Which are Lama’s top markets?

Lama handles the largest incoming visitors from India, followed by the GCC.

What is the impact of the depreciating rouble on Russian tourists to the UAE?

There will certainly be a negative impact with the deprecating Russian currency. Travel purchases including flights and accommodation will become more expensive.

What will the merger with Carfare bring?

It gives Lama and its customers a variety of products. Lama gets in hand over 3,500 cars for its customers from the GCC region. It also gives us an additional 200 limousines which can be offered to high-end customers who come from the GCC, India and other countries. We used to outsource these services and at times it was difficult to cater to last-minute requirements. That will not be the case now and we will also be adding to our fleet to cater to anticipated future demands.

With dnata acquiring the Thomas Cook unit, do you see yourself competing with them?

The market is very large and I think there is enough business for everyone. I believe in cooperation and then competition. I am sure this will only help our customers to select a variety of products.

What is your market share in the UAE?

We are the market leaders when it comes to number of visitors to the UAE from India, local safari operations, city tours and cruises. We move in about a million customers per year in the market.

What are your expansion plans outside the UAE?

We plan to invest Dh50 million within the next six months to add more cars to our fleet and offices in the region. We have already started Lama franchises in India and have signed up eight that offer our express visa services. The plan is to have 30-40 franchises in India and also open Carfare franchises in the GCC.


Follow us on Twitter @Ind_Insights