'28% GST on amusement parks should come down'

The amusement park industry is a capital-intensive business and now with GST of 28% on amusement-theme park industry, it’s going to be a roller-coaster ride for the business. In an interaction with Uma Kannan of DH, Wonderla Holidays Limited Managing Director Arun K Chittilappilly says 28% tax rate is unfortunate and it puts the industry at par with gambling and horse racing, which is unfair. Edited excerpts:

How the new tax impacts you?

A: The present tax rate will affect the industry and it will be difficult to get new people for investments. We have increased the ticket price by Rs 150 after GST implementation, and it is now approximately Rs 1,150 on weekdays, and Rs 1,350 on weekends. Since it is off season for us, we will know the impact of the tax rate only in the next quarter. We have made a representation to the government, and we will make again to reduce the tax rate. I expect that it should come down to 12%, and we are hoping for it.

Wonderla went for repositioning recently with a new brand identity. How is it right now and whether it has been completed?

A: We are redesigning our parks in terms of look and feel. Kochi park is 17-year-old now, we built Bengaluru park in 2005, and Hyderabad park last year. With a new logo and sonic identity, we aim to become a complete holiday destination, and not just as an amusement park. It will take a month or so for redesigning completely. Also, we have imported a roller coaster ride with an investment of Rs 25 crore from the Netherlands for our Kochi park, and it’s being installed now. As far as redesigning and rebranding are concerned, we are investing around Rs 2 crore each in Bengaluru and Kochi parks.

How much do you invest in rides?

If you take a roller coaster or big rides, they are quite expensive. We need to invest Rs 5 crore to Rs 30 crore depending on the complexity of rides. In case of water slides, it will be less than a crore. The amusement park industry is a capital-intensive business, and it is a very small industry in India. We generally import rides from Italy and Germany and the safety measures are undertaken.

Our most popular rides in Bengaluru are the Sky Wheel and Recoil roller coaster, among others. People visit amusement parks to have fun. It’s just like a playground for both adults and kids alike. We want to serve them better. If you take our Bengaluru park, it is located in such a way that we get footfalls from Tamil Nadu, Kerala and South Karnataka too.

When are you opening an amusement park in Chennai? Are you planning to open more parks?

We have completed acquisition of 57 acres of property in Thiruporur on OMR Road in Chennai. We will start the work in the third quarter of this fiscal year and it should be operational in two years. We are investing close to Rs 350 crore in the park. Unlike other amusement parks that are mostly operational in only one state, we have parks in multiple cities. We are planning to open one park in the West - either in Goa, Maharashtra or Gujarat. We want to go national, open many high quality amusement parks.

How has been your journey so far since 2000?

We started off with 150 employees, and now we have around 2,500. This number will touch 3,500 in another one or two years, as soon as we open our Chennai park. In every location, we employ 700 to 1,000 people. We are also investing in technology, in terms of reducing waiting time in parks. We have enthralled over three crore visitors across three cities since 2000.

We are seeing 10 lakh footfalls every year in both Kochi and Bengaluru parks. In Hyderabad, it’s over 6.5 lakh, and we are expecting 1.5 lakh more this fiscal. We are growing by 15-20% every year. Our revenues for the first quarter of this fiscal were Rs 105.43 crore, an increase of 17% over corresponding period of last financial year, which was Rs 90.43 crore. Our park revenues from Bengaluru, Kochi and Hyderabad in the quarter were Rs 102.21 crore, an increase of 18% over the corresponding period of last financial year, which was Rs 86.89 crore.