Recovery for Indian hotels slow\, occupancy rate at around 24% in first week of September
New Delhi: Six months after government enforced lockdowns and travel restrictions following the Covid 19 pandemic, recovery for India’s hospitality sector has been slow, with all India occupancy rate for hotels hovering at around 24% on an average in the first week of September and revenue per available room (RevPAR) just shy of Rs 1000, as per data shared by industry tracker STR with ET.
Demand for quarantine rooms which had been aiding hotel occupancy growth across major markets in India is now slowing down.
Faring better than the national average, hotels in Mumbai, Delhi, Chennai, Gurgaon, and Hyderabad are reporting around 30-40% occupancy levels, Vidhi Godiawala, business development manager for central and South Asia at STR said. Despite Covid cases going up in the country, the industry is also beginning to see weekend leisure demand in some markets.
“Some leisure markets in India, especially in the North, have picked up in August in terms of weekend demand. We are seeing marginal, but visible weekend leisure spikes in markets such as Udaipur, Jaipur and Amritsar. Some movement is seen in the Southern regional markets as well, however, occupancy for hotels in Goa has flatlined and is struggling in the single digits,” said Godiawala.
“Each state has different response measures to tackle the virus and depending on the situation on the ground, travellers are choosing their destinations accordingly,” she added.
Ajay Bakaya, MD, Sarovar Hotels said occupancies for his hotels were about 22% in August. 75 out of 90 Sarovar hotels in India were operating in most of August.
“Recovery has been very slow. Recovery in business hotels is slower. Recovery in cities like Bengaluru which are dependent on tech is even slower. Leisure hotels in places where you can drive to or reach without any stringent travel restrictions are reporting better occupancies,” he said.
Renu Basu, senior vp, global sales and marketing at Indian Hotels Company (IHCL) said metros such as Delhi and Mumbai have done well and the chain is seeing green shoots of recovery from guests taking staycations and some leisure demand in markets such as Nashik, Coorg and Udaipur.
"More and more travellers are looking to break the monotony of being confined at home and are looking to unwind by staying at their trusted hotel brands. By the fourth quarter, occupancy rates could potentially increase to 35% ," said Kerrie Hannaford, VP, commercial at Accor India & South Asia.
Zubin Saxena, MD and VP, operations, South Asia at Radisson Hotel Group said quarantine stays continue to be a top contributor while leisure demand has also found its way back as people start venturing out for staycations and road trips. “Our estimate for recovery to pre-pandemic levels is about 12-16 months from this point,” he added.
Hotels in India’s favourite holiday destination Goa continue to struggle though. Hotels in Bengaluru have also not seen much growth in comparison to the other metros and occupancy for this market is still below 15% as per STR.
“Jaipur and Udaipur are witnessing a recovery in average daily rates and occupancies to some extent. This represents a trend of some amount of leisure travel out of hinterland Delhi/NCR and Gujarat whereby travellers are taking road journeys over weekends,” said Jaideep Dang, managing director, Hotels and Hospitality Group (India) at JLL.