Double-Digit Growth For Branded Hotels In India: Crisil
To meet increasing demand, the pace of room additions, is expected to pick up further through asset-light route
Double-Digit Growth For Branded Hotels In India: Crisil
New Delhi: Branded hotels in India are likely to see double-digit revenue growth of 13-14 per cent this fiscal (FY25) and 11-12 per cent in the next (FY26), fuelled by demand outpacing supply, a Crisil report said on Thursday.
Operating margin is likely to improve by 100-150 basis points (bps) this fiscal and sustain at similar levels in the next, with benefits of operating leverage kicking in and other cost optimisation measures undertaken, said the Crisil Ratings report.
It further stated that while domestic leisure and business travel will continue to be the primary demand drivers, growing traction in MICE (meetings, incentives, conventions and exhibitions) segment and pickup in foreign tourist arrivals will provide an additional fillip.
This comes on the back of a strong 17 per cent growth recorded last fiscal.
“The domestic leisure segment will continue to drive growth on the back of rising travel aspirations and better regional connectivity. Further, positive economic outlook and the government’s ‘Meet in India’ initiative to promote corporate events will support the business and MICE segments,” said Mohit Makhija, senior director, Crisil Ratings.
Foreign tourist arrivals are also expected to surpass the pre-pandemic levels this fiscal.
These factors will drive up the average room rates (ARRs) of branded hotels by 6-7 per cent this fiscal on an already high base, said Makhija.
