According to a report by credit rating firm ICRA, the Indian hotel industry anticipates a revenue growth of seven to nine per cent in the upcoming financial year 2024-25. ICRA highlighted that the continued interest in domestic leisure travel and the demand for meetings, incentives, conferences, and exhibitions (MICE) will be key drivers of this growth, despite a temporary slowdown during the forthcoming general elections.
The research firm highlighted that spiritual tourism and Tier 2 cities are anticipated to contribute significantly to the overall demand in the next fiscal year.
Continue Exploring: Oyo to open 400 properties in major spiritual hotspots amidst growing demand for spiritual tourism
According to ICRA, pan-India hotel occupancy estimates have reached a ten-year peak of 70 percent to 72 percent in the current financial year and are expected to remain at that level in the next fiscal year, compared to 68 percent to 70 percent in 2022-23.
Pan-India, average room rates (ARRs) are expected to be around INR 7,200 to INR 7,400 in the current fiscal, which is likely to rise further to INR 7,800 to INR 8,000 in the next financial year.
ICRA holds an optimistic view regarding the Indian hospitality industry, noting improvements in credit ratings, the report said.
The increase in demand led to a rise in supply announcements and the commencement of deferred projects over the past 18 to 24 months. However, it was noted that supply would trail behind demand.
Continue Exploring: Indian hospitality industry set for a record-breaking 2024: Surge in new hotel rooms expected