Business News | Hotel Industry Growth May Moderate in Third Quarter as Base Normalises: Report
Get latest articles and stories on Business at LatestLY. The domestic hotel industry could see growth in revenue per available room (RevPAR) moderate in the third quarter as the base normalises, although a strong wedding calendar in 2027 is expected to support demand and sustain healthy growth into the following financial year, according to a report by Jefferies.
New Delhi [India], October 21 (ANI): The domestic hotel industry could see growth in revenue per available room (RevPAR) moderate in the third quarter as the base normalises, although a strong wedding calendar in 2027 is expected to support demand and sustain healthy growth into the following financial year, according to a report by Jefferies.
The brokerage said the industry’s momentum remained strong in September, supported by higher room rates, resilient domestic travel demand and meetings, incentives, conferences and exhibitions (MICE) activity. However, the pace of growth could ease as comparisons with the previous year become less favourable.
“As the base normalizes in 3Q, growth may ease from current highs, though a strong CY27 wedding calendar should support FY28 trends,” Jefferies said in its report on Wednesday.
India’s hotel industry recorded a 19 per cent year-on-year increase in RevPAR in September 2026, compared with 18 per cent in the second quarter of FY27. Growth had stood at 16 per cent in the first quarter and 7-8 per cent in the fourth quarter of FY26, the report said.
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Performance of the hotels during September was driven by average daily room rates rising around 13 per cent year-on-year, while occupancy increased by approximately 6 per cent. Strong domestic travel and MICE activity, along with a gradual recovery in foreign tourist arrivals, supported the industry’s performance.
“While growth could normalise in 3Q as base growth improves, a strong wedding calendar in CY27 could help sustain healthy RevPAR trends into FY28,” the brokerage said.
Demand from major events also supported hotel performance during September. A busy calendar, including BRICS, the Global Fintech Fest and Semicon India, boosted MICE activity and helped improve occupancy and room pricing, particularly in Delhi and Mumbai.
Performance varied across domestic markets, with Delhi recording 37 per cent year-on-year RevPAR growth and Rajasthan registering a 33 per cent increase. Mumbai and Hyderabad posted growth of around 19-20 per cent, while Bengaluru grew 14 per cent. Goa’s growth slowed to 3 per cent after a stronger May-August period.
Jefferies said it remained constructive on the sector, while noting that the normalisation of growth in the coming quarter would be an important factor to watch. The outlook for FY28 will depend partly on whether sustained travel demand and the wedding calendar offset the impact of a higher comparison base. (ANI)
(The above story is verified and authored by ANI staff, ANI is South Asia's leading multimedia news agency with over 100 bureaus in India, South Asia and across the globe. ANI brings the latest news on Politics and Current Affairs in India & around the World, Sports, Health, Fitness, Entertainment, & News. The views appearing in the above post do not reflect the opinions of LatestLY)