HVS India Hospitality Trade Overview 2023

This report highlights the important thing traits within the Indian hospitality business in 2023 together with the sector efficiency metrics, model signings, and model openings through the 12 months. It additionally supplies our outlook for the sector for 2024.

Government Abstract

The 12 months 2023 marked an important turning level for the worldwide journey and tourism business, because it continued its restoration whereas navigating challenges. Amid excessive local weather modifications, escalating geopolitical tensions, rising financial headwinds, and rising journey prices, the worldwide journey business shifted gears making vigorous strides in the direction of pre-pandemic ranges, as an increasing number of folks traveled for enterprise, schooling, and leisure actions.

On this world narrative of resurgence, India stood out not simply as a participant however as a beacon of development and optimism. Buoyed by strong financial development, historic scientific achievements like Chandrayaan-3, and the celebrated G20 presidency, India showcased exceptional resilience and dynamism. These milestones, together with the regular rise in home tourism and the revival of inbound tourism catalyzed the journey and tourism sector, in flip propelling the hospitality sector to new heights in 2023.

Whereas revenge journey regularly declined, the leisure section skilled sustained development, pushed by evolving traveler preferences and a rising curiosity in distinctive experiential journey. Inbound tourism displayed promising indicators of restoration, with 9.2 million overseas vacationer arrivals through the calendar 12 months 2023, marking a exceptional 49% year-on-year development and simply over 15% wanting all-time-highs final skilled in 2019. After practically three years of restricted cross-border journey, outbound tourism from the nation witnessed a powerful comeback, mirroring a pattern akin to the pent-up demand that fueled home tourism within the final two years. Consequently, over 27 million Indian nationals traveled abroad through the 12 months, registering a 26% development in comparison with 2022 and 1.3% in comparison with 2019. The sturdy revival of weddings, MICE and company journey segments, coupled with high-profile occasions just like the G20 conferences and the ICC Males’s Cricket World Cup performed a pivotal position in revitalizing the fortunes of the sector through the 12 months.

The efficiency of the Indian resort sector in 2023 mirrored this optimism, with key efficiency indicators resembling occupancy price, common price (ARR), and Income Per Accessible Room (RevPAR) witnessing vital development. The sector closed the calendar 12 months 2023 with a nationwide occupancy price within the vary of 63-65%, up 3-5 proportion factors (pp) from the earlier 12 months and practically reaching the pre-pandemic stage of 65-67% in 2019. The ARR for 2023 reached a powerful INR 7,400-7,600, which surpassed the figures from 2022 by 21-23% and 2019 by 24-26%, highlighting the sector’s capacity to push charges pushed by the buoyant demand. The expansion in common charges helped RevPAR to achieve INR 4,662-4,940 in 2023, indicating a major enhance of 29-31% from 2022 and 19-21% in 2019.

Locations throughout the spectrum, from bustling metros like Mumbai and Delhi to common leisure locations like Goa and Jaipur, and serene, lesser-explored places resembling Rishikesh and Kashmir emerged as stalwarts of this development, every telling its distinctive story of restoration and alternative.

The 12 months additionally marked a report variety of model signings, underlining the sector’s confidence within the Indian market’s potential. This development was not simply quantitative however strategic, with a eager deal with increasing into smaller cities and underserved markets. These developments mirror a sector that’s not simply recovering however reimagining its future.

Waiting for 2024, the outlook for India’s hospitality sector is imbued with a way of optimistic realism. HVS anticipates continued development, pushed by sustained home demand, the return of worldwide journey to its full glory, and the expansion of area of interest tourism segments coupled with the large development going down in journey infrastructure throughout the nation. With a panorama as dynamic and numerous as India’s, the potential for innovation, enlargement, and sustainable improvement within the journey and tourism sector is boundless.

We count on India-wide occupancy to enhance to 66-67% in 2024, coupled with a 6-8% enhance in ARR will push RevPAR to INR 5,281 through the 12 months, nearly 31-33% increased than the pre-pandemic RevPAR recorded in 2019.

We hope you discover this report insightful and stay up for your suggestions as we proceed to navigate the evolving panorama of Indian hospitality collectively.

Mandeep S. Lamba, President – South Asia, oversees the HVS follow in South Asia. Mandeep has spent over 30 years within the hospitality business having labored with Worldwide Lodge Corporations resembling Alternative Accommodations, IHG and Radisson Accommodations earlier than changing into President for ITC Fortune Accommodations in 2001. Having efficiently constructed the Fortune model in India’s mid-scale hospitality sector, Mandeep ventured into an entrepreneurial stint for over 8 years, establishing JV corporations with Dawnay Day Group UK and Onyx Hospitality Thailand earlier than becoming a member of JLL in 2014, as Managing Director, Accommodations & Hospitality Group – South Asia. A longtime business chief, Mandeep has received a number of awards and recognitions for his accomplishments. Lately, he was featured within the Hotelier India Energy Checklist of essentially the most revered hoteliers in India for the second 12 months in a row. Contact Mandeep at +91 981 1306 161 or mlamba@hvs.com.

Dipti Mohan, Senior Supervisor – Analysis with HVS South Asia, is a seasoned information skilled with intensive expertise in research-based content material creation. She has authored a number of ‘standpoint’ paperwork resembling thought management studies, knowledgeable opinion articles, white papers and analysis studies. Contact Dipti at dmohan@hvs.com.

Dhwani Gupta, Affiliate – Analysis with HVS South Asia, studied literature for her undergraduation and believes that you are able to do something with the correct amount of analysis. After graduating, she pursued a course in Administration and Liberal arts which gave her a wider perspective of the world. Consequently, the tougher a subject is, the extra enjoyable she has writing it. Contact Dhwani at dgupta@hvs.com