With demand finally outpacing supply, the Indian hospitality industry is on an upswing. The 'India Hospitality Industry Review 2018' report by HVS ANAROCK predicts RevPAR to grow by 9.5 per cent in 2019.
As in all business cycles, the Indian hospitality sector is now trending upwards. Performance metrics like the Average Daily Rate (ADR) are showing positive signs of growth. However, the Supreme Court ban on liquor sales and the call for prohibition in some of the cities have not only forced existing players to review upcoming projects, but also impacted proposed investments and M&A transactions.
In November 2016, the Indian Government announced the demonetisation of Rs 500 and Rs 1,000 currency notes. The impact of this move has been felt in the hospitality industry, where the peak season is from October to March.
Clarity on long-term opportunities is vital for hospitality real-estate success. India is on the move. Inbound and domestic tourism is booming. Business travel is picking up. And travellers are looking for places to stay. It all spells sunshine for the hotel industry.
How long is the long road to profitability in smaller hospitality markets in India? CW PROPERTY TODAY attempts to find some answers. ¨Demand for hotels in Tier-II and Tier-III cities has been very limited so far