EIH Associated Hotels corrects 5% after rising as much as 26% in previous three straight sessions

EIH Associated Hotels share price has seen correction of 5 percent intraday Thursday after rising 26 percent in previous three straight sessions.

In fact, not only EIH but also other hotels stocks had also been rallied in previous sessions on hopes of good earnings for the quarter ended March 2018 as October-March period is always good for hotel companies.

"The October-March period is considered to be a strong season for the sector that accounts for around 60-65 percent of overall annual sales. The rise in occupancy levels supported by a healthy pick-up in demand (domestic + international) is expected to lead to a rise in room rates (ARRs) and robust expansion in margins of all established large hotel players in India, going forward, as 60 percent of total operating costs are fixed in nature," ICICI Securities said in its report dated April 17, 2018.

During the past three years, the hotel industry has witnessed a visible demand improvement in pan-India occupancy levels. The robust growth in foreign tourist arrivals, limited new room additions along with an uptick in domestic demand would be key structural positive growth drivers for the hotel sector in the long run, it added.

Meanwhile, the board of directors have decided upon the partial closure of Trident Udaipur for renovation of some ofthe rooms, from May 1 to October 31, 2018.