Why Invest in a Resort in India? The Developer's Complete Guide (2026)
- Loom Crafts Engineering Team
- Jul 21
- 18 min read
Updated: Aug 26
Why Invest in a Resort in India? The Developer's Complete Guide (2026)
In This Guide You'll Learn:
How domestic tourism growth is creating unprecedented demand for quality accommodation
The different types of resorts you can build and which formats generate the best returns
How much it costs to develop a resort in India and what drives profitability
Why prefab construction is transforming resort development timelines and costs
What the most successful resort developers do differently from those who struggle
How to start generating revenue faster using modern construction methods
Answers to the most frequently asked questions about resort investment in India
Introduction
India is experiencing one of the most significant transformations in its tourism history.
For decades, international travel dominated the aspirations of India's growing middle and affluent classes. Holidays meant flights abroad, foreign currencies and overseas hotels. Domestic tourism was considered secondary — something you did when you couldn't travel internationally.
That perception has changed permanently.
A combination of rising disposable incomes, the rapid growth of platforms like Airbnb and MakeMyTrip, an explosion in content about domestic destinations on Instagram and YouTube, and a post-pandemic rediscovery of India's extraordinary natural and cultural landscape has created a domestic tourism boom unlike anything the country has seen before.
Millions of Indian travellers are now actively seeking authentic, experiential and nature-based accommodation across India's hills, coastlines, forests, backwaters and farmland. They are booking boutique resorts, glamping retreats, farmstays, eco-lodges and private villas at rapidly growing rates. And they are willing to pay premium prices for quality experiences that combine natural settings with modern comfort.
The supply of such accommodation, however, has not kept pace with demand. Across India's most sought-after destinations — from Coorg and Goa to Rishikesh, Uttarakhand, Lonavala, Wayanad and the Andamans — there is a significant and widening gap between the number of quality accommodation units available and the number of travellers actively seeking them.
For landowners, investors, developers and entrepreneurs, this gap represents one of the most compelling hospitality investment opportunities in India today.
💡 Loom Crafts Expert Insight: The most successful resort developers we work with share one thing in common: they didn't wait for perfect conditions. They identified a location with strong demand fundamentals, built efficiently using modern construction methods, and started generating revenue while others were still drawing up plans. Speed to market is one of the most powerful advantages in hospitality investment — and it's the advantage that modern prefab construction delivers most consistently.
1. The State of India's Tourism Industry in 2026
To understand why resort investment in India makes sense, it helps to understand the scale and trajectory of what's happening in Indian tourism.
Domestic Tourism Is Enormous and Growing
India is home to over 1.4 billion people, with a rapidly expanding middle class and an increasingly affluent urban population. Domestic tourist visits in India have grown consistently over the past decade. According to Ministry of Tourism data, India recorded over 1.7 billion domestic tourist visits in recent years — a figure that makes India one of the world's largest domestic tourism markets by volume.
More significantly, the character of domestic tourism is changing. Travellers are increasingly seeking:
Nature-based and experiential accommodation rather than conventional hotels
Private and semi-private retreats away from crowded urban environments
Outdoor experiences including hiking, cycling, wildlife, water sports and adventure activities
Wellness and rejuvenation retreats combining yoga, Ayurveda and nature
Instagram-worthy environments that combine design and natural settings
Pet-friendly accommodation for families and couples
Workation destinations that combine remote work with leisure
These preferences align almost perfectly with what boutique resorts, eco-lodges, glamping destinations and private villa retreats offer — and they represent a structural shift in demand rather than a temporary trend.
The Airbnb and Short-Term Rental Revolution
The growth of short-term rental platforms has created an entirely new category of hospitality investment. Property owners and resort developers can now list individual cottages, villas and glamping units on platforms such as Airbnb, MakeMyTrip, Booking.com, StayVista and SaffronStays, accessing millions of potential guests without requiring the marketing infrastructure of a traditional hotel.
A family with land near a popular hill station, beach destination or forest region can now build four to eight premium cottages, list them on multiple booking platforms and generate substantial rental income without needing a large team, a hotel license or a massive marketing budget.
The Experience Economy Is Reshaping Guest Expectations
Post-pandemic Indian travellers have developed a clear preference for meaningful, memorable experiences over conventional accommodation. Research consistently shows that today's travellers — particularly millennials and Gen Z — prioritise experiences over possessions. They book accommodation that offers a story worth telling, a photograph worth sharing and a memory worth keeping.
A well-designed glamping pod overlooking a paddy field in Coorg, a prefab A-frame cottage on a hillside in Himachal Pradesh or a floating deck cottage on Kerala backwaters can generate significantly higher revenue per night than a conventional hotel room — precisely because it offers something unique and memorable.
💡 Loom Crafts Expert Insight: We regularly see resort projects in Coorg, Goa, Rishikesh and the Himalayas achieve occupancy rates of 70 to 85 percent during peak seasons, with average daily rates of ₹8,000 to ₹25,000 per unit depending on the design, location and guest experience. The returns available in India's boutique hospitality sector compare favourably with almost any other real estate asset class — with the added benefit that you're building on land you already own or control.
2. Why India's Resort Market Has an Undersupply Problem
Understanding why the resort investment opportunity is so compelling requires understanding a fundamental structural imbalance in India's hospitality sector.
The Accommodation Gap
India's domestic tourism market is enormous, but the supply of quality non-hotel accommodation has not kept pace with demand growth. The boutique resort, eco-lodge and premium glamping segment remains significantly undersupplied across most of India's popular leisure destinations.
Coorg, Karnataka — one of India's most popular coffee country escapes, with millions of annual visitors but a relatively limited supply of quality boutique accommodation
Spiti Valley and Lahaul, Himachal Pradesh — growing rapidly as adventure tourism destinations with very limited high-quality lodging
Chopta and Tungnath, Uttarakhand — emerging trekking destinations with almost no quality organised accommodation
Gokarna and Murudeshwar, Karnataka — established beach destinations significantly underserved by quality boutique resorts
Wayanad, Kerala — tremendous demand growth but still insufficient premium nature lodges
Alibaug and Kashid, Maharashtra — extremely close to Mumbai but with a quality accommodation shortage that keeps pushing up prices
In each of these destinations, travellers actively seeking quality accommodation frequently find that properties are either fully booked weeks in advance or that available options don't meet their quality expectations. This consistent undersupply creates a sustained pricing power advantage for well-developed resort properties.
Why New Supply Has Been Slow to Emerge
If the demand fundamentals are so strong, why hasn't more supply been built? Several factors have historically constrained new resort development:
Construction timelines have been too long — a conventionally built resort cottage can take 18 to 36 months to complete
Construction quality in remote locations has been unreliable — skilled labour is scarce, material quality varies and project management is difficult from a distance
Capital requirements have been prohibitive for smaller developers
Landowners lacked knowledge and confidence to develop their most beautiful potential resort locations
The emergence of modern prefab construction technology is beginning to address several of these constraints simultaneously — opening the boutique resort sector to a much wider range of developers and investors.
💡 Loom Crafts Expert Insight: Many of the most successful resort developers we work with are not professional hoteliers. They're families who inherited agricultural land near a popular destination, entrepreneurs who spotted a gap in the market, or landowners who decided to put idle assets to work. What they have in common is a great location, the ambition to create something special, and the wisdom to use modern construction methods that get them to market quickly.
3. Types of Resorts You Can Build in India
One of the most important early decisions a resort developer makes is choosing the right format for the location, budget and target guest profile.
Glamping Resorts
Glamping — the combination of glamour and camping — has become one of India's fastest-growing hospitality formats. A glamping resort features premium tented accommodation or prefab cottages in a natural setting, private outdoor spaces, campfire areas and outdoor dining. Investment per unit ranges from ₹8.5 lakh to ₹20 lakh. Revenue per unit can range from ₹3,500 to ₹12,000 per night.
Boutique Eco-Resorts
A boutique eco-resort combines sustainable design with nature-based experiences and high-quality accommodation. These properties feature 8 to 24 units, strong environmental credentials, wellness offerings and community engagement. They command premium pricing and generate strong repeat bookings from quality-conscious travellers.
Farmstay and Agri-Tourism Resorts
India's agri-tourism sector has grown substantially, driven by urban travellers seeking authentic rural experiences. Farmstay resorts combine agricultural settings with accommodation and farm-based experiences including crop plucking, cooking classes and farm-to-table dining — generating multiple revenue streams.
Adventure and Activity Resorts
Adventure tourism is one of India's fastest-growing travel segments. Activity-based resorts focus on outdoor experiences as the primary attraction and benefit from group bookings, school programmes, corporate team-building events and adventure travel agencies.
Corporate Retreat and Wellness Resorts
These properties benefit from high average spending per guest, group bookings that fill the property at once, off-season demand and long booking lead times that improve revenue predictability. Wellness resorts combining yoga retreats and corporate health programmes achieve strong year-round occupancy.
Private Villa and Luxury Cottage Collections
These properties feature 4 to 12 units with complete privacy between cottages, private plunge pools, dedicated service and premium interiors. Revenue per night for premium private villa collections can reach ₹25,000 to ₹75,000 per unit.
💡 Loom Crafts Expert Insight: The format that works best for your location depends on the site characteristics, target guest profile, budget and your own hospitality vision. We've helped develop resorts across all of these formats — from 4-unit glamping pods in Uttarakhand to 32-unit luxury cottage collections in Goa and Coorg. The most important thing is matching the format to the destination and the guest rather than simply copying what someone else has built elsewhere.
4. India's Most Promising Resort Investment Locations
Location is the single most important factor in resort investment success. These are India's most compelling resort development destinations in 2026.
Uttarakhand — The Adventure and Wellness Capital
Uttarakhand has experienced explosive growth in domestic tourism driven by proximity to Delhi NCR, diverse landscapes and year-round demand from adventure tourism, wellness retreats and pilgrimage travel. Best locations: Rishikesh, Mussoorie outskirts, Mukteshwar, Chopta, Auli, Chakrata, Lansdowne, Kanatal, Dhanaulti. Typical ADR range: ₹4,500 to ₹18,000 per unit per night.
Himachal Pradesh — The Hill Station Classic
Himachal Pradesh remains India's most popular hill station destination with a diverse tourism profile. Best locations: Manali outskirts, Bir Billing, Tirthan Valley, Jibhi, Spiti Valley, Chail, Kasauli outskirts, Sangla Valley. Typical ADR range: ₹3,500 to ₹15,000 per unit per night.
Goa — The Year-Round Premium Market
Goa continues to attract premium resort investment as India's strongest international tourism market outside major cities, with strong year-round demand from both Indian and international visitors. Typical ADR range: ₹8,000 to ₹35,000 per unit per night.
Karnataka — Coorg, Chikmagalur and Beyond
Karnataka's coffee country destinations have emerged as South India's most compelling boutique resort investment locations, driven by the large and affluent domestic market from Bangalore. Best locations: Coorg, Chikmagalur, Sakleshpur, Murudeshwar coastal areas. Typical ADR range: ₹5,000 to ₹20,000 per unit per night.
Maharashtra — Proximity to Mumbai and Pune
Maharashtra's leisure destinations benefit from access to two of India's wealthiest urban markets. Best locations: Alibaug, Kashid, Murud, Lonavala outskirts, Panchgani outskirts, Kolad riverfront. Typical ADR range: ₹6,000 to ₹25,000 per unit per night.
Kerala — The Wellness and Backwater Destination
Kerala's established international reputation as a wellness and Ayurveda destination creates a premium tourism market. Best locations: Munnar outskirts, Wayanad, Alleppey backwater properties, Varkala, Kovalam outskirts, Thekkady surroundings. Typical ADR range: ₹4,000 to ₹22,000 per unit per night.
💡 Loom Crafts Expert Insight: Every market we've mentioned has micro-locations within it that dramatically outperform the average and others that consistently underperform. Site selection within a destination matters as much as the destination itself.
5. The Financial Case for Resort Investment
What Does It Cost to Build a Resort?
A typical prefab resort development cost structure:
Land cost: ₹20L – ₹2Cr+ (highly location-dependent)
Cottage construction per unit: ₹8.5L – ₹45L (depends on BHK size and spec)
Infrastructure — roads, power, water: ₹10L – ₹40L
Common areas — reception, dining, pool: ₹15L – ₹1Cr
Landscaping and outdoor spaces: ₹5L – ₹25L
Interior furnishing per unit: ₹2L – ₹15L
Pre-opening and working capital: ₹5L – ₹15L
Typical 8-cottage resort total: ₹1Cr – ₹5Cr (excluding land)
Revenue Potential
Example — 8-Cottage Boutique Eco-Resort, Coorg. Conservative scenario: ADR ₹6,500, occupancy 55%, total annual revenue ₹1.32Cr. Optimistic scenario: ADR ₹9,500, occupancy 70%, total annual revenue ₹2.52Cr. A well-run operation can achieve EBITDA margins of 35 to 55 percent.
The Phased Development Advantage with Prefab
With prefab construction, a developer can build the first four cottages and open within 60 to 90 days. Revenue from those four operational cottages then partially funds the next phase. This dramatically reduces peak capital requirement, accelerates time to revenue, provides real market feedback before committing full capital, and reduces financial risk during the early operating period.
💡 Loom Crafts Expert Insight: The most common financial mistake we see resort developers make is building the entire resort before opening. They invest all their capital upfront, spend 18 to 24 months in construction, then spend another 12 months building occupancy before the resort becomes profitable. With prefab construction, you can be open and generating revenue in 90 days and use that revenue to fund subsequent phases. The difference in capital efficiency and risk profile is enormous.
6. Why Prefab Construction Is Transforming Resort Development
Speed to Market
A prefab cottage can be manufactured and installed on site in 45 to 90 days. A conventionally built cottage of equivalent quality typically requires 12 to 24 months of on-site construction. This difference transforms the financial model of resort development entirely.
Quality Consistency
Factory manufacturing removes most quality variables. Every wall, floor panel, roof component and structural element is produced using precision machinery and standardised processes, with quality inspections at each production stage. For resort developers building 8, 12 or 20 cottages, factory consistency means every unit meets the same standard.
Reduced Site Disruption
Prefab construction dramatically reduces on-site activity. Manufacturing happens in a factory. On-site work is limited to foundation preparation and installation — typically completed in days or weeks rather than months. This makes prefab construction particularly well suited to environmentally sensitive resort locations in forests, hills and coastal areas.
Cost Predictability
Prefab construction offers substantially greater cost predictability because building components are manufactured at agreed prices, material quantities are precisely calculated, factory production is not subject to weather delays, and quality issues are identified during manufacturing rather than on site.
Suitability for Remote Locations
Loom Crafts Prefab has delivered resort cottages to locations across Uttarakhand, Himachal Pradesh, Goa, Karnataka, Kerala, Assam and dozens of other states — including properties in challenging terrain that would have been extremely difficult to develop using conventional construction methods.
💡 Loom Crafts Expert Insight: We recently completed a glamping resort in Uttarakhand at an elevation of over 2,400 metres. The access road was narrow, the site was surrounded by forest, and the nearest town was three hours away. Using prefab, the cottages were manufactured in our Ghaziabad facility, transported in sections and installed on site in six weeks. The resort opened for its first season within 90 days of the development decision being made.
7. Key Risks and How to Manage Them
Location Risk
Choosing the wrong location is the most common and most costly mistake in resort development. How to manage it: Visit the location during different seasons. Research occupancy and pricing data from comparable properties. Understand the access road conditions during monsoon. Verify that water, electricity and connectivity are available before committing capital.
Regulatory Risk
Building without required approvals or in violation of land-use regulations can result in project delays or legal complications. How to manage it: Verify land classification before purchasing. Engage licensed architects and consultants. Complete all required approvals before beginning construction.
Operational Risk
Many resort developers are excellent at building but less experienced at operating. How to manage it: Consider partnering with an experienced hospitality management company in the early years. Study the operational model of comparable successful resorts. Build your team before you open, not after.
Seasonality Risk
Most resort destinations experience significant seasonal variation in demand. How to manage it: Choose a location with year-round demand or multiple demand drivers. Design the resort to attract corporate, wellness and special-interest groups during shoulder seasons. Build financial reserves to manage low-season periods.
Construction and Development Risk
How to manage it: Use modern prefab construction with predictable timelines and factory-controlled quality. Work with experienced manufacturers who have delivered comparable resort projects. Agree on fixed-price contracts with clear delivery milestones. Plan a contingency budget of 10 to 15 percent above the estimated construction cost.
💡 Loom Crafts Expert Insight: The developers who are most successful with resort investment treat risk management as seriously as return optimisation. They spend time on location validation, ensure their legal and regulatory position is completely clear before committing capital, and build with methods that give them cost and timeline certainty.
8. What Successful Resort Developers Do Differently
They Validate Demand Before Building
Successful developers research occupancy and pricing data from comparable properties in the destination. They speak with travel agents, OTA partners and tour operators. They understand seasonal patterns, group booking trends and the traveller profile. Only after confirming genuine demand do they commit capital.
They Match the Property to the Guest
The most successful resort developers have a clear picture of exactly who their guest is before they design a single cottage. Every design decision — cottage layout, interior specification, common areas, experiences, pricing, food and beverage — flows from a clear understanding of the target guest.
They Build Efficiently and Open Quickly
The developers who achieve the strongest financial returns consistently prioritise speed to market. They use modern construction methods that enable faster delivery. They open with fewer units rather than waiting to complete the entire resort. They start generating revenue and building reviews as early as possible.
They Invest Seriously in Guest Experience
A beautiful resort with a mediocre guest experience will earn average reviews and struggle to achieve premium pricing. A slightly simpler resort with an exceptional guest experience will earn five-star reviews, command premium rates and fill its calendar months in advance through word-of-mouth alone.
They Plan the Entire Business Before Breaking Ground
The most successful resort developers create a business plan covering revenue projections, operating cost estimates, staffing requirements, marketing strategy, platform distribution, break-even analysis and return on investment timeline before a single brick is laid.
💡 Loom Crafts Expert Insight: The single most common characteristic we see in our most successful resort developer clients is clarity of vision. They know exactly what they're building, who they're building it for and what success looks like before construction begins. That clarity leads to better design decisions, faster execution, stronger guest experiences and ultimately more profitable resorts.
9. Getting Started: Your First Steps Toward Resort Development
Step 1: Define Your Vision and Investment Parameters
Before looking at land or speaking with architects, clarify what type of resort you want to build, your total investment budget, what guest experience you want to create, which destination appeals to you, what level of involvement you want in operations, and what financial return you are seeking.
Step 2: Research and Validate Your Target Destination
Visit the destination at different times of year including low season. Research occupancy and pricing data from comparable properties. Speak with local tourism operators, travel agents and OTA partners. Understand the road access and infrastructure situation before committing.
Step 3: Identify and Evaluate Land
Land selection requires careful evaluation of legal land classification, topography and elevation, water availability, electricity infrastructure, road access quality, proximity to activities and attractions, and any environmental constraints or regulatory issues.
Step 4: Complete Legal and Regulatory Due Diligence
Before purchasing land, complete thorough legal due diligence covering land title verification, land classification and applicable development permissions, local planning regulations, applicable tourism licensing requirements, and for coastal properties, CRZ classification and applicable regulations.
Step 5: Develop Your Concept and Business Plan
Once land is secured and legal status confirmed, work with architects and hospitality consultants to develop a resort concept, detailed site plan and phasing strategy, a financial model covering development cost and revenue projections, and an operational plan covering staffing, distribution and marketing.
Step 6: Begin Construction Efficiently
For most boutique resort developers in India, modern prefab construction now offers the most compelling combination of speed, quality, cost predictability and suitability for remote and sensitive locations. Contact Loom Crafts Prefab to discuss your resort concept and understand how our capabilities can help you build and open faster than any conventional construction method allows.
10. Frequently Asked Questions
1. Is resort development a good investment in India right now?
Yes — the fundamental demand dynamics for boutique hospitality in India are strongly favourable. Domestic tourism growth, the rise of experiential travel, the undersupply of quality boutique accommodation and the emergence of efficient construction technologies have combined to make this one of India's most compelling real estate investment categories.
2. How much capital do I need to start a resort?
The minimum viable investment for a small boutique resort — covering land, construction, infrastructure, furnishing and working capital — typically starts from ₹50 lakh to ₹1.5 crore for a 4 to 6 cottage property in an accessible destination.
3. Do I need hospitality experience to develop a resort?
Not necessarily. Many successful boutique resort developers in India had no prior hospitality background. However, strong operational management is essential. Developers without hospitality experience often benefit from partnering with an experienced hospitality management company.
4. How long does it take to open a resort using prefab construction?
A typical boutique resort using Loom Crafts Prefab cottages can go from design finalisation to operational opening in 90 to 150 days depending on the number of units, site conditions and infrastructure requirements. This compares with 18 to 36 months for a conventionally constructed resort of equivalent size.
5. Can I build a resort on agricultural land?
This depends on the applicable state agricultural land conversion regulations and local planning rules. In many states, agricultural land can be converted for tourism and hospitality use subject to the required permissions. Each case must be evaluated individually.
6. What occupancy rate should I plan for?
A new boutique resort in a well-chosen location typically achieves 40 to 55 percent occupancy in its first year, growing to 60 to 75 percent by year three as reviews build and the property develops a loyal guest base.
7. How many cottages should I start with?
For most developers, starting with 6 to 10 cottages provides a good balance between operational efficiency and manageable capital investment. A phased approach — 6 cottages initially with planned expansion — is often the most financially efficient strategy.
8. Which hospitality platforms should I list on?
The most important platforms for Indian boutique resorts include MakeMyTrip and GoIbibo, Airbnb, Booking.com and curated boutique platforms such as SaffronStays, StayVista and Secret Escapes. Most successful resorts list on multiple platforms simultaneously.
9. How does prefab construction compare with conventional construction?
Prefab construction typically delivers the completed resort 3 to 5 times faster than conventional construction, with comparable or better quality, greater cost predictability and significantly less on-site disruption.
10. How can Loom Crafts Prefab help with my resort project?
Loom Crafts Prefab works with resort developers at every stage — from initial concept consultation and design to engineering, manufacturing, transportation and installation. With over 600 completed prefab structures across India including resort cottages in Goa, Rishikesh, Coorg, Alibaug and 50+ other locations, we bring both technical expertise and real-world hospitality project experience to every development.
Conclusion
India's resort investment opportunity is real, compelling and — for developers who move decisively and build intelligently — genuinely transformative.
The fundamental drivers are strong: domestic tourism growth, an undersupply of quality boutique accommodation, changing traveller preferences toward authentic nature-based experiences and the emergence of powerful digital distribution platforms that give even small boutique properties access to millions of potential guests.
The development economics are increasingly favourable, particularly for those who use modern prefab construction methods that compress the development timeline from years to months, reduce on-site complexity and improve cost predictability.
The best time to begin this journey is with knowledge. You now have a comprehensive understanding of why India's resort investment landscape is so compelling, what types of resorts generate the strongest returns, how to evaluate locations and investments, and how modern prefab construction can help you build faster, open sooner and generate returns more efficiently.
The next step is yours.
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Continue Reading
Developing a Resort — Knowledge Center
This is Article 1 of 50 in the Developing a Resort series. Continue your resort development journey with future articles in this series as they are published.
Building a Home — Related Reading
These articles from our Building a Home series provide valuable context on land, approvals and prefab construction that directly applies to resort development:
Explore All Knowledge Center Pillars
Ready to Develop Your Resort?
Whether you're in the early stages of exploring a resort investment or ready to move forward with a specific location, the Loom Crafts Prefab resort development team is ready to help. With over 600 completed prefab structures across India — including resort cottages, glamping pods, luxury villas and hospitality developments in Goa, Rishikesh, Coorg, Alibaug, Uttarakhand, Kerala, Assam and 50+ other locations — we bring both technical expertise and genuine resort project experience to every conversation.
Our Resort Development Team Can Help You With:
Preliminary project feasibility discussions
Resort concept and design consultation
Site-responsive architectural planning for your location
Engineering solutions for remote, coastal and hill station environments
Accurate cost estimates and phasing strategy
Precision factory manufacturing of cottages, villas and glamping pods
Transportation and installation across India
Complete turnkey resort development solutions
Call Our Resort Team: +91 98711 22239 (Rahul Jindal) | Email: rahul@loomcrafts.com
📅 Prefer a live walkthrough? Book a free online demo at a time that suits you — our team will take you through designs, 2026 pricing and the complete build process on a video call: Book Your Online Demo
Important Disclaimer
The financial projections, revenue estimates and investment figures provided in this guide are illustrative examples intended for general educational purposes only. Actual returns depend on location, specification, management quality, market conditions and many other factors. This guide does not constitute financial, legal or investment advice. Readers should conduct independent research and consult qualified financial advisors, legal professionals and hospitality consultants before making investment decisions.
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