HEADLINES:  

The Indian Hotel Industry had a negative growth for 2012-13 with limited prospects of growth according to a latest study by ICRA. For the immediate term growth remains clouded with an uncertain economy impacting demand even as lumpy supply additions occur. The Indian Hotel Industry hit new lows during Q2, 2012-13 with falling revenue and escalating power costs eroding operating margins which coupled with increase in fixed costs resulted in many players in the industry posting net losses.

During 2012, global tourist volumes have grown by a modest 3-4% as compared to 5.9% during the year 2011. Foreign Tourist arrivals (FTAs) to India grew by 5.4% during 2012 with India welcoming 6.65 million travelers.

The growth trajectory had slowed down sharply from that of the previous two years. However growth subdued to about 5-6%. There continues to be several dark clouds in the horizon driving down global consumer confidence due to the global uncertainty. The domestic situation has been largely stable, while the rate cut, spate of reforms and some healthy corporate numbers in 2012-2013 provide some respite in the near term.

According to a report, significant supply addition is expected across key markets in India during 2012-13, particularly in Chennai and the NCR. Supply addition in 2013-14 also expected to be robust. The Indian Hotel occupancies, barring some pick up in October 2012, has been lower than the previous fiscal.


The pan India Revenue-per-available-room (RevPARs) have dipped by 6% during 2012, following a 4% dip during 2011. In the wake of continued business weakness, hotels are focusing on non-room revenue segments like Food & Beverage (F&B) to mitigate the impact. The F&B segment has been witnessing healthy demand on the back of increasing purchasing power and changing aspirations of consumers who are willing to pay for new cuisines and experiences. This has resulted in increase in specialty restaurants and fine dining options in the premium hotels segment across India.

  INDIAN Hotel INDUSTRY AT A Glance IN 2011 - 2012

  Hotel Association of India

  The Federation of Hotel and Restaurant Associations of India (FHRAI)

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