Hotel stocks swell on demand outlook
Hotel stocks were up in trade on Wednesday on a strong demand outlook for the sector. Indian Hotels is up 5.45 per cent at Rs 414 on BSE. EIH is up 4.4 per cent at Rs 242 on BSE. Chalet Hotels is up 2.3 per cent at Rs 535.Lemon Tree Hotels is up 4.2 per cent at Rs 107.
image for illustrative purpose
New Delhi: Hotel stocks were up in trade on Wednesday on a strong demand outlook for the sector. Indian Hotels is up 5.45 per cent at Rs 414 on BSE. EIH is up 4.4 per cent at Rs 242 on BSE. Chalet Hotels is up 2.3 per cent at Rs 535.Lemon Tree Hotels is up 4.2 per cent at Rs 107.
The demand outlook for chain-affiliated hotels looks strong on the back of buoyant domestic demand, significantly higher foreign tourist arrivals due to one-time events (G-20 Summit and the Cricket World Cup) and the forthcoming wedding season, JM Financial Institutional Securities said in a report.
“We re-iterate our positive stance on the sector, as we believe demand concerns beyond FY24E are slightly overdone. Hotel room demand will largely be led by domestic tourism and is expected to outgrow room supply in the medium term,” the report said. “Consequently, we believe that the peak occupancies and ARRs for the hotel industry are some time away. As per Hotelivate research, the total branded room supply across major Indian cities is 152,945 as on March 2022 and the upcoming supply is 59,238 rooms over FY22-27E with an active development ratio of 72 per cent (42,531 rooms).”
