The hotel industry, which has been experiencing a surge in room rents due to events like the G20 summit, seems to have reached a plateau. Despite expectations of a boost from the ongoing Cricket World Cup 2023, the actual impact on hotel revenues has been underwhelming.

Insights from Industry Veteran

Sanjay Sethi, MD and CEO of Chalet Hotels, highlighted that the absence of specific teams or bookings associated with the World Cup has limited the event’s impact on hotel occupancy. He noted that most visitors attending matches are local residents, leading to shorter stays, typically lasting one to one-and-a-half days.

Disappointing Performance Metrics

The anticipated increase in Revenue per Available Room (RevPAR) during the Cricket World Cup has not materialized. Analysts suggest that the event failed to significantly influence hotel RevPAR, despite hosting 48 matches across 10 locations.

IDBI Capital’s analysis indicates a decline in average room rates (ARR) across major markets in October, with the exception of Jaipur and Hyderabad. Furthermore, while year-on-year growth remains robust, the second quarter typically witnesses a seasonal dip in performance due to factors like monsoons and festivals.

Outlook and Future Prospects

Although the Cricket World Cup did not deliver the expected boost, the hotel industry remains optimistic about future prospects. The upcoming Indian wedding season, scheduled to commence by the end of the month, presents a significant revenue opportunity. Additionally, government initiatives to promote domestic tourism, coupled with Indians’ penchant for travel, are expected to sustain demand.

According to a report by BP Equities, the hospitality industry is poised for medium-term growth, with demand projected to outpace supply in the coming years. Analysts anticipate double-digit revenue growth for the current financial year, fueled by optimistic outlooks for inbound tourism in the latter half of the year.