Hotel industry's double-digit growth to continue this fiscal, says ICRA report

livemint.com:

World Cup 2023, the report said. It is estimated that premium-hotel occupancy will remain at a high of 70-72% across India in the fiscal year, after recovering to 68-70% in FY23.

The industry is poised for strong growth in the year, with occupancy at decadal highs and average room rates (ARRs) nearing their peak in FY08, the report said. Premium-hotel ARRs are expected to be between ₹6,000-6,200 this year.

This recovery is being driven by a confluence of factors, including improvements in infrastructure and air connectivity, and favourable demographics, it added. The report said operating margins are expected to be at 25-28% this fiscal, as against 28-30% in FY23 and 20-22% pre-covid.

This is due to the sustenance of a large part of the cost-rationalisation measures undertaken during covid, along with operating leverage benefits, it said. But margins may moderate from the last fiscal year with hotels undertaking renovations and maintenance.