A report from JLL stated that between January and March of 2024, the Indian hotel industry experienced a Y-o-Y growth in performance, mainly due to an 8.5% increase in Average Daily Rate compared to the same period in 2023, leading to a RevPAR growth of 11.4%. The primary reasons for this expansion consisted of a rise in business travel, weddings, meetings, incentives, conferences, and exhibitions (MICE) demand by the conclusion of the financial year (FY24).
The industry also registered a RevPAR increase of 5.5% Quarter-on-Quarter (Q-O-Q) in Q1 2024, in comparison to Q4 2023. JLL's Hotel Momentum India (HMI) Q1, 2024 report attributes the increase to more corporate travel in Q1 2024 compared to the holiday season in Q4 2023.
The report noted a strong need for hotel rooms in both business and leisure locations during the quarter. The hotels in important business areas were busy, with around 70% of rooms filled on average and a big increase in how many people stayed each day.
The report also mentioned that the strong start in the first quarter is predicted to carry on into the second quarter, fueled by business travel, MICE events, and weddings during the peak season. Furthermore, the upcoming quarter is expected to experience an increase in leisure travel, especially during the summer vacation period.
According to the JLL report, 90 branded hotel signings were recorded in Q1 2024, with a total of 9,710 rooms. Additionally, 13 hotels that signed were previously converted from other hotels, making up 12% of the total inventory signed in Q1 2024. The opening of 36 branded hotels included a total of 2,316 keys, with 75% of them located in Tier-2 and 3 cities such as Jaipur, Indore, Surat, and Ayodhya.
In Q1 2024, Chennai led in RevPAR growth with a 21.7% increase compared to Q1 2023, followed by Hyderabad and Delhi with Y-o-Y growth rates of 21.1% and 19% respectively, as per the JLL report.
The hotel sector's strong performance in 2024 will be driven by positive consumer sentiments and domestic corporate travel, which were initiated in the first quarter. Important areas for both business and pleasure are experiencing high demand, leading to an increase in Average Daily Rate (ADR) levels, aided by minimal increases in supply. Generally, the demand factors align with the sector's projected stable performance until 2024. Jaideep Dang, who is the managing director of the hotels and hospitality group at JLL in India, said that the only problem might be the end of summer because more people might be going on trips. He also mentioned there could be a quiet period after the general election results.
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Ans 1. The hospitality industry is a broad category of fields within the service industry that includes lodging, food and beverage services, event planning, theme parks, travel agency, tourism, hotels, restaurants, nightclubs, and bars.
Ans 2. India Hospitality Market Analysis The Hospitality Industry In India Market size is estimated at USD 247.31 billion in 2024, and is expected to reach USD 475.37 billion by 2029, growing at a CAGR of 13.96% during the forecast period (2024-2029).
Ans 3. The concept of hospitality is deeply rooted in Indian culture. It is seen as a sacred duty to provide food, shelter, and protection to guests, regardless of their social status or background. This tradition is reflected in many ancient Indian texts, including the Vedas, the Upanishads, and the Mahabharata
Ans 4. Goa has been the go-to holiday destination for Indian and international tourists for many decades now. From exotic beaches to rich heritage sites, Goa boasts of places that give the region its unique identity.
Ans 5. The hospitality industry contributes majorly to the economy of a country by employing its human resources. It generates new employment, contributing to the GDP or gross domestic product of a country.