What’s Driving India’s Premium Hotel Occupancy – India Report
Photo Credit: ICRA has maintained that the hospitality demand outlook in India remains healthy. Pixabay from Pexels
Skift Take
Several factors are driving the demand for hospitality industry in India, especially domestic tourism. ICRA expects this robust demand to lead to strong growth in FY2025.
The pan-India premium hotel occupancy is estimated to reach decade highs of 70-72% in the coming fiscal year (2025), according to credit rating agency ICRA. The agency has also estimated that the Indian hotel industry will report revenue growth of 7-9% in 2024-2025. For the financial year ending on March 31, 2024, ICRA is expecting the industry revenue to grow 14-16%.
Factors driving demand: ICRA said that sustained domestic leisure travel, meetings, incentives, conferences, and exhibitions (MICE), weddings and business travel are the factors that would drive demand in the next financial year. Spiritual tourism and tier 2 cities will also contribute to the industry. The primary driver is expected to be domestic tourism, as seen in fiscal 2024.
Demand outlook: In the medium term, ICRA has maintained that the demand outlook remains healthy. This is supported by improved infrastructure and air connectivity as well as favorable demographics.
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