The hotel sector in India is looking forward to a successful fiscal year in 2024.

The Indian hotel industry anticipates a robust fiscal year in 2024, with double-digit revenue growth, according to ICRA. The growth will be attributed to a combination of domestic and international factors, especially in the latter half of the fiscal year.

Premium hotels in India are forecasted to achieve occupancy rates of around 70–72%, marking a significant recovery. Average room rates for these hotels are projected to be in the range of Rs. 6,000–6,200, maintaining a 20–25% discount relative to the FY2008 peak. Despite healthy occupancy, slight margin dips are anticipated in FY2024 due to extensive renovation and maintenance activities undertaken by hotels, surpassing pre-COVID levels.

Mr. Prakash Bedi, Vice President of Clarks Safari shares key insights on 2024 hospitality trends., He believes the key metro cities will again lead to an increase in tourism due to MICE, business travellers, etc. The majority of the revenue in the tourism sector will flow from domestic travellers, but international travel will also pick up. At the same time, experiential travel and tier-2 cities will also witness a tourist surge due to infrastructural development. Technology will play a bigger role, and even boutique hotels will strengthen their IT infrastructure, to generate more footfalls.

He further adds, “Tourists are becoming more aware of their preferences and choices, adventure tourism will witness a surge. The existing national parks infrastructure will be improved and a few new parks might open up. Wildlife tourism will attract more domestic and international tourists. With the opening of Ram Mandir in Ayodhya, spiritual tourism will see a boost.  Also, sustainability will no longer remain a PR activity. The way climate concerns are being raised, and sustainable efforts are taken by the global hospitality chain, it will not remain a one-off activity. The whole sector has to evolve and put strict measures in place.  The travellers are becoming much more conscious and are ready to pay a premium if it means cutting down on carbon footprints.”

A word of caution here,  2024 does not have any major lineup like the cricket World Cup or G20 that will lead to an increase in tourism. The Indian elections are also round the corner, thus the industry needs to have an action plan in hand, to manage the tourist dip. Also, US elections, which are a major source of international tourists, can influence travel plans and spending.