Rama Krishna Sangem
In a good news for hotel industry, the Indian hospitality sector continued to witness growth in the first quarter of the ongoing year, primarily driven by an 8.5 per cent rise in average daily rates, resulting in an 11.4 per cent increase in revenue per available room (RevPAR).
According to JLL’s Hotel Momentum India (HMI) Q1 2024, factors such as an increase in corporate travel, weddings, and Meetings, Incentives, Conferences, and Exhibitions (MICE) demand at the end of FY24 have contributed to this strong performance of the sector.
The sector also witnessed a 5.5 per cent growth in RevPAR in Q1 2024 when compared to the previous quarter.
A robust demand for hotel rooms—in both business and leisure destinations—continued during the quarter. Occupancy levels in key business markets also remained strong at around 70 per cent.
Chennai led the growth in RevPAR with an increase of 21.7 per cent from the year-ago period, followed by Hyderabad and Delhi with year-on-year (Y-o-Y) growth of 21.1 per cent and 19 per cent, respectively.
Trend will continue this year
The positive momentum witnessed in the first quarter is expected to continue into the second quarter, with business travel, MICE, and weddings driving the busy season. A surge in leisure travel is also expected in the second quarter, owing to the summer holidays.
The Jan-March quarter, meanwhile, saw 90 branded hotel signings comprising 9,710 rooms. Furthermore, 13 hotels signed were conversions of other hotels, accounting for 12 per cent of the inventory signed in Q1 2024.
The focus remained on Tier II and Tier III cities, with 75 per cent of the total number of 2,316 keys from 36 branded hotel openings in cities including Jaipur, Indore, Surat, and Ayodhya, among others.
“The first quarter has set the ball rolling for the hotel sector’s strong performance throughout 2024—healthy consumer sentiments and domestic corporate travel will continue to be the key drivers. Key business and leisure locations are witnessing strong demand, which has translated to growth in ADR levels, assisted by limited supply additions,” said Jaideep Dang, managing director, hotels and hospitality group, India,
