In what will mark the entry of Luxury Collection in India, ITC Hotels and Starwood Hotels & Resorts will be signing a new contract today for exclusive rights to one of the latter’s most premium brands. The contract is expected to be a short-term one — for about four to five years.

A major re-branding exercise will be undertaken by ITC as it would be converting some of its 10 Sheraton properties to Luxury Collection.While the details would be revealed today, sources say that the Maurya Sheraton at New Delhi and the Mughal Sheraton at Agra would definitely be upgraded to Luxury Collection. The Rajputana Palace Sheraton at Jaipur, however, will not be re-branded.

But that’s not all for ITC. It is also planning to compete head-on with the Ananda Spa, the most luxurious spa in India and one of the most renowned ones in the world. ITC is working towards setting up even a more luxurious spa at its Agra property.

The gameplan is to not only leverage Luxury Collection’s global clientele but to also overtake Ananda by taking advantage of the immensely popular Delhi-Jaipur-Agra triangle. The location of this spa is unbeatable. Most tourists want to see Taj Mahal when they come to India. They will now have the opportunity to travel the Delhi-Jaipur-Agra circuit and be able to stay at India’s most luxurious spa. In comparison, Ananda is a secluded, destination spa,” said an insider. However, Ananda’s seclusion in the Himalayas, is considered to be one of its most attractive features. But if they market the package right, the Agra spa might just eat into Ananda’s share.

For sometime now, visitors to Agra have started staying overnight instead of just making day trips. Industry experts point to unofficial statistics that show the average duration of stay in Agra has increased from less than a day to a day and a quarter.Domestic MICE has also picked up, especially since the Mughal Sheraton built a large banquet hall recently. The Mughal Sheraton is spread across 35 acres, and it is still not known whether the spa would be built on this area or on land adjoining the hotel.

Today’s conference should also reveal whether the re-branding exercise would impact the room rates. While average room rates for the Luxury Collection are substantially higher than Sheratons in the international market, it remains to be seen whether re-branding will affect rates in India.

“Pricing, at the moment, is being determined only by the demand-supply gap. We also have to see whether there will be a significant change in the product. For example, Maurya Sheraton in New Delhi is reducing its room inventory to add more luxury suites. That might have a small impact on the rates,” said an industry expert.

One impact is that Luxury Collection will make its foray into India without making a hefty investment. “The ITC-Sheraton hotels in India are anyway more upscale than typical Sheraton hotels in international market. This way, Starwood is able to bring Luxury Collection to India without making a very large investment,” said a hotel consultant.