Home / Business and Economy / Sri Lanka Luxury Hotels Soar in FY26
Sri Lanka Luxury Hotels Soar in FY26
17 May
Summary
- Luxury hotels in Sri Lanka experienced significant growth in FY2026.
- Leisure and MICE segments were key drivers of hotel performance.
- Indian tourists are the largest source market for Sri Lanka.
Luxury hotels across Sri Lanka demonstrated robust growth throughout FY2026, with the leisure and MICE segments leading the charge. ITC Hotels announced its first international property, ITC Ratnadipa in Colombo, achieved EBITDA positive status in its inaugural operational year, also maintaining market leadership in RevPar.
Indian Hotels Company Ltd reported a 21 percent year-on-year increase in business for its three Sri Lankan properties during the fourth quarter of FY26, indicating positive market expansion. In calendar year 2025, Sri Lanka welcomed 2.36 million international visitors, marking a 15 percent increase, with India alone contributing over five lakh tourists.
While the West Asia conflict caused a decline in European arrivals in the month prior to May 17, 2026, and impacted supply chains, the growing number of Indian visitors offers a hopeful outlook for the tourism industry. John Keells Holdings Plc, owner of Cinnamon Hotels, highlighted the substantial potential for increasing Indian tourist numbers. Their ambitious "City of Dreams" project in Colombo, featuring the Cinnamon Life hotel and other amenities, has seen a positive uptake, particularly for conferences and corporate events from India.
