The Trends & Opportunities Report, published annually by HVS India for the past 18 years, depicts and analyses the key trends in the hotel performance of the country and presents HVS’ outlook with special emphasis on 13 major Indian markets. The report also outlines existing and future opportunities in the hospitality industry of specific interest to investors, developers and hotel operators.
The key extracts of this year’s report are as follows:
- India’s supply of rooms in the organised sector has almost quadrupled to over 93,000 at the end of 2012/13 from about 25,000 in 2000/01.
- Despite supply growing at 17.8% CAGR, demand kept pace and grew at a 17.3% CAGR between 2008/09 and 2012/13.
- A majority of the branded hotels in the country are less than five years old, which basically means that a majority of our hotel room inventory came online during the five years of the worst financial crisis the world has seen since the Great Depression.
- Budget and mid market hotels are increasingly forming a larger percentage of the total inventory and now accounting for nearly half of all existing hotel rooms and close to 60% of the future supply in the country.
- A little over 50,000 branded rooms will be developed over the next five years, taking the total supply to about 144,000 rooms by 2017/18.
- As much as 90% of our demand, if not more, comes from companies resulting in hotels struggling with low occupancy levels during weekends.
- In 2012/13, only 5% of our hotels attained an average rate of over US$200 and no city hotels in the country attained an average rate in excess of US$300.
- The nationwide RevPAR recorded a 5.2% drop in 2012/13 over the previous year with the five-star segment registering the maximum decline.
- Conversely, budget and economy hotels registered the highest RevPAR growth (10.4%) on the back of a 14.7% increase in average rate.
- Mumbai has the highest existing supply of branded rooms in the country (12,807), followed closely by Delhi (11,338) and Bengaluru (8,536).
- NOIDA (including Greater NOIDA) continued to rank last amongst the 13 major markets with an existing base of only 836 branded rooms.
- Kolkata emerged as the best performing hotel market in terms of occupancy (69.5%) in 2012/13, while Mumbai registered the highest average rate (`7,646) and RevPAR (`4,881).
- Agra, Pune, Goa and Jaipur were the only major hotel markets in the country to record notable RevPAR growths in 2012/13. NOIDA (including Greater NOIDA) witnessed the maximum decline in RevPAR (27.5%) in 2012/13.
Kaushik Vardharajan, Managing Director – HVS Global Hospitality Services, South Asia comments, “Clearly, India does not have a demand problem! In the 18 years of data we have amassed at HVS, we have seen demand drop only once, in late 2008, due to the collapse of the global economy following the Lehman debacle and then due to the terrorist attacks on Mumbai. Since then, demand has surged again. We would venture to say that irrespective of what you are selling and where you are selling it, if demand for your product increased more than 17% ever year on an average during the global financial crisis, then you are in the right market selling the right product!” Manav Thadani, Chairman, HVS South Asia adds, “The last fiscal saw a distinct rise in transaction activity, in addition to a number of hotels being rebranded. This is a clear sign of a maturing industry with investors and operators standing to gain. Enough and more existing hotels across positioning are now available for sale in the market; in fact we have ourselves seen an increase in the number of transaction mandates we are running!”
Please click here to view the India Trends & Opportunities Report.