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Businesses returning to normalcy: It’s yesterday once more for consumers as Covid fades



With Omicron cases falling at a rapid pace, demand in contact-intensive sectors is picking up fast and has touched around 75% of the pre-pandemic levels, according to industry estimates. No wonder, hotels, restaurants, retail chains, malls and multiplexes, which have borne the brunt of Covid-led restrictions for over two years, are now seeking an end to all kinds of curbs put on their operations by various state governments for their businesses to return to full normalcy.

For instance, footfalls are back to 70% of the pre-pandemic levels at Mumbai’s Infinity Malls, but as Mukesh Kumar, CEO of Infinity Malls, said, curbs on restaurants to operate at 50% of their capacity is still impacting business.

If the country’s top four metros are taken into account, business at restaurants is around 40% of the pre-pandemic levels.

Pradeep Shetty, joint honorary secretary, Federation of Hotel & Restaurant Associations of India, said: “Operating at 50% capacity has a direct impact on the extent of the business. On the other hand, city hotels have managed to regain only 35% of the pre-pandemic business since there is no international travel and business travel is low.”

As restrictions are gradually being eased, customers have returned to malls and multiplexes too. With a couple of big film releases lined up in March, multiplexes expect moviegoers to come back in larger numbers. In Kolkata, for instance, malls are “almost at pre-Covid level”, in terms of footfalls, says Sushil Mohta, chairman, eastern region, Shopping Centre Association of India (SCAI).

Zorawar Kalra of Massive Restaurants, which runs 32 fine-dine restaurants across nine cities, said the industry has suffered immensely over the past two years with over 25% of all restaurants shutting down permanently. “While demand recovery has been quicker than most expected, the restrictions of timing and occupancy continually plague chances of survival. If airlines can have 100% occupancy, why not restaurants that have far greater distance between tables,” he said.

Restaurant chains with a pan-India footprint are seeking easing of restrictions so that the industry can recover fully at a faster pace. They are also seeking restoration of input tax credit on GST immediately as that is seen as an obstacle to faster recovery.

Mohta, who is also chairman of Merlin Group, told FE that sales were good with the arrival of the winter season but have suffered December last week onwards till February first week, due to Omicron-led curbs. After some relaxations with the number of cases going down, the food and beverages segment has picked up. The hope is that reopening of schools will give more confidence to the public at large to visit malls and multiplexes.

With demand returning, mall rentals, too, are back to near-normal levels. In fact, post-March 2021, tenants have paid normal rentals with no waivers, according to Mohta, who is also the promoter-director of Kolkata’s South City Mall, and whose Merlin Group is the developer of the city’s Acropolis Mall.

Kumar of Mumbai’s Infinity Malls said malls have supported the brands throughout the lockdown and while the support may differ category to category, “we do not see any major challenges here”.

Data from emerging IT and start-up hub Pune are even more encouraging. After fresh restrictions were imposed in December, consumer demand is making a strong comeback and could touch pre-Covid levels by March. Surjit Singh Rajpurohit, chief operating officer of the 1.2-million sq ft Amanora Mall in Pune, said, “We will be reaching pre-Covid levels by mid-March. Last year when malls opened, a customer rush was seen in the white goods stores, but now everyone is looking at everything. The marriage season and travel are driving footfalls. Barring formal apparel, all the segments are doing well.”

The food and beverage segment is back to full capacity and theatre occupancy has reached around 60%. With three big releases slated for March, recovery could take occupancy to 80%.

Rishu Baweja, director at Cult House Terra, said that footfalls have been stable after the government decided to lift restrictions. “The response is quite good, we have seen an increase in walk-in customers. If the current scenario continues, we will soon go back to pre-Covid levels as far as sales and customer response is concerned,” Baweja said.

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