Himachal Pradesh has given East India Hotels, the Oberoi Group company, a 35-year licence to run Wildflower Hall near Shimla. The award follows an e-auction for the 85-room luxury hotel at Chharabra. The winning bid gives the state 47.1% of the hotel’s annual gross revenue. The operator will also pay a ₹24 crore upfront licence fee and invest at least ₹50 crore in the property. Chief Minister Sukhvinder Singh Sukhu expects the state to earn about ₹2,000 crore over the term.
The auction ends a legal fight over the property that lasted about 25 years. Hindustan Times says the Supreme Court upheld the transfer to the state in January 2024, while The Tribune dates that order to February 2024. The state took possession on 31 March 2025 and let the Oberoi Group keep running the hotel during the bidding. Himachal keeps full ownership of the land, building and assets, and the operator only runs the business. Officials call the 47.1% share the highest bid of its kind in India, which gives other states a price benchmark for public hotel assets.
Our view is that the state is the clear winner, and East India Hotels pays a high price to keep a flagship. A revenue share is charged on gross revenue, before wages, energy and upkeep, so the operator carries all the cost risk. Coverage has focused on the ₹2,000 crore headline and has said little about how the operator will protect its margin. India’s airport concessions show a past pattern: GMR’s Delhi airport consortium bid a 45.99% revenue share in 2006 and later pressed for higher charges and more non-airport income. We expect Wildflower Hall to lift its published room rates and add paid guest experiences within 12 months. We also expect at least one more state to auction a public hotel on a revenue share model within 18 months. Confidence: medium.
This is important for our readers because the 47.1% figure is now the number state governments will quote in future hotel tenders. If you run a hotel on leased public land, model this week what a 40% to 50% gross revenue share would do to your margin. If you book Shimla stays for clients in 2027, ask the hotel for written rate validity now. If you plan to bid for state assets, read the Himachal auction terms when the state publishes them.
Sources:
Hindustan Times, 31 Oct 2026
The Tribune, 31 Oct 2026
The New Indian Express, 31 Oct 2026
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