ICRA estimates pan-India premium hotel occupancy at 70–72 per cent in FY2024, after recovering to 68–70 per cent in FY2023. Pan-India premium hotel average room rates (ARRs) are expected to be at ₹6,000–6,200 in FY2024. The medium-term demand outlook also remains healthy, supported by a confluence of factors, including improvements in infrastructure and air connectivity, favourable demographics and anticipated growth in large-scale M!CE events with the opening of multiple new convention centres in the last few years, among others. The healthy demand amid relatively lower supply would lead to higher ARRs. Larger players would also benefit from revenues or shares of profits generated from hotel expansions through management contracts and operating leases.
