According to the credit rating agency ICRA, after a post-Covid growth, India’s hotel industry is now expected to normalize its growth. The agency’s outlook has been revised from “positive to stable” and it expects revenue growth between 6-8% this financial year.
The industry has seen double-digit revenue growth for the past three financial years.
ICRA also expects to see the hospitality sector in India maintain a rate of occupancy between 72-74%. This projection is slightly more than the occupancy rate of 70-72% maintained over the last two years.
The demand for domestic leisure travel is driving the growth, as are MICE (meetings and incentives, conferences, and exhibitions), and weddings.
According to Jeffries Financial Services, the industry will continue to grow due to a favorable demand-supply dynamic, domestic travel on the rise, and strong pricing power.
ICRA as well as Jeffries have both commented on the recent geopolitical issues that occurred between India and Pakistan. They both stated that, while tensions in May disrupted travel, their impact was only short-lived.
While the terror attacks of April 2025 in India and the subsequent increased uncertainty in North-West India in May 20,25 led to an increase in travel cancellations and MICE in India, the effect was temporary and localised. Recently, there have been
