Whitbread, the leisure group, is to invest £150 million developing its Premier Travel Inn (PTI) budget hotel chain in India and is close to signing a deal to take its Costa coffee shop chain to Russia.

The company, which is also eyeing China as a market for PTI, said yesterday that it had signed a 50-50 joint venture with Emaar MGF Land Private, an Indian property developer, to build about 80 hotels with 12,000 rooms over the next ten years.

The joint venture will invest a total of £300 million over that period. The initial sites will be in and around Delhi, Madras, Goa, Hyderabad and Chandigarh as the chain looks to target both business and leisure travellers.

Alan Parker, Whitbread’s chief executive, said that the entry of PTI into the Indian market would fill a gap in the hotel sector, adding: “The pace of economic development in India is quite phenomenal.” He said that PTI, which last year signed its first overseas venture in the Gulf region, was also searching for partners in China.

The news came as Whitbread revealed plans to rebrand Premier Travel Inn as Premier Inn. The longer name was introduced three years ago when the group acquired the Premier Lodge chain and merged it with its Travel Inn chain.

The conversion followed research that showed poor consumer recognition of the PTI brand and will cost £21 million, of which £17 million will be spent on signage and advertising supporting the revamp.

Mr Parker also revealed plans to continue developing the group’s Costa coffee chain internationally as it seeks to increase its total number of stores from 762 – of which 573 are in the UK – to 2,000 by 2010. By the end of the summer he hopes to sign a joint venture deal in Russia, where he sees potential to have “several hundred” stores over time.

Despite speculation that Costa could be spun off, Mr Parker insisted that there was “absolutely no question at all” of that happening. Yesterday Whitbread reported a 5.6 per cent increase in like-for-like sales from continuing businesses in the 13 weeks to May 31, led by a jump of 10.1 per cent from PTI and 4.7 per cent from Costa. Its struggling Brewers Fayre and Beefeater pub-restau-rants continued their recent improvement, reporting like-for-like sales up 1.5 per cent.

Mr Parker confirmed that, after the sale of DLL and a review of its debt financing, the group was considering how much cash to return to shareholders. Douglas Jack, leisure analyst at Panmure Gordon, expects Whitbread to return up to £900 million in the autumn.

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