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Holiday hotels see rise in occupancy levels, but experiences painfully slow recovery

Many hotels renting rooms below standard rates cites as main reason. Hotels say leisure destinations, not metros, are the main revenue-earners now. In fact, hotels lobby body FHRAI says occupancies and room rates, pan-India, are still low.

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Hotels run out of rooms for upcoming Diwali weekend
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24 Feb 2021 12:09 PM IST

Many hotels renting rooms below standard rates cites as main reason. Hotels say leisure destinations, not metros, are the main revenue-earners now. In fact, hotels lobby body FHRAI says occupancies and room rates, pan-India, are still low.

Several hotels at holiday destinations reported high occupancy levels in December and January, but operators caution about a painfully slow recovery, just as the country braces for a presumed second wave of the pandemic.

Hotels and resorts were selling rooms a level below their rated standard for all of December and January the two best months of the year for the industry. A five-star luxury property was selling rooms at rates normally seen for four-star rooms, and it even included food and beverages.

The industry is heavily dependent on leisure destinations to churn revenues as metro properties, which rely on corporate business, continued to be affected because of the pandemic.

According to research firm STR Global, revenue per available room (RevPAR) in December more than trebled, compared to the initial phase of 'unlocking' in July.

For Indian Hotels Company, one of the biggest hotel companies in India, the RevPAR jumped nearly five times to Rs 3,424 by the end of December, compared to Rs 734 recorded by the end of June. However, it was still less than half, compared to the pre-COVID period when IHCL recorded Rs 7,462 RevPAR in FY20.

Speaking to analysts, Puneet Chhatwal, managing director, Indian Hotels Company, said, "At this point of time, Q4 will definitely be stronger than Q3, if there is no new sudden wave of virus coming or lockdown. There is no reason why February should not do as well as December or March."


Hotel Tourism 
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