What is driving the current growth in India's hotel sector?

Growth is driven by higher room rates, strong demand from corporate travel, MICE, weddings, and leisure, and expansion into smaller cities.

What are Nikhil Sharma's predictions for India's hotel market?

Nikhil Sharma expects continued growth led by rates, with RevPAR increasing in the low teens and significant expansion into non-metro areas.

How is the 'aspirational class' impacting India's hotel industry?

The aspirational class, including younger travelers, is willing to pay a premium for experiences, boosting demand and revenue for hotels.

Home / Business and Economy / India's Hotel Boom: Rates Soar, Demand Surges

India's Hotel Boom: Rates Soar, Demand Surges

16 Dec

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Summary

Hotel room rates and revenue per available room are increasing significantly.
Strong demand stems from corporate travel, MICE, weddings, and leisure.
Growth is expanding beyond metros into smaller cities and tier-2 markets.

India's Hotel Boom: Rates Soar, Demand Surges

The Indian hospitality sector is poised for significant growth, as industry leaders predict sustained price increases and market expansion. Experts from Radisson Hotel Group and Royal Orchid Hotels highlight a shift in consumer behavior, driving demand despite potential disruptions. Current growth is primarily rate-led, with average daily rates (ADRs) increasing by 10-12% in peak periods, leading to low-teen growth in revenue per available room (RevPAR).

This expansion is propelled by robust demand from corporate travel, meetings, incentives, conferences, and exhibitions (MICE), alongside weddings and "festive leisure." A key trend is the broadening of demand into smaller cities, with Radisson Hotels noting that 70% of newly signed hotel keys are outside of metro areas. Bengaluru, for instance, has seen a 20-23% rate increase, with projections for micro-markets to grow by 6-7%.