169.4% Growth in RevPAR: Indian Hospitality Industry Back on Track
The hospitality and tourism industry is showing promising signs of recovery in the third quarter of this financial year. And this is evident from the statistics themselves. The revenue per available room (RevPAR) in the third quarter of 2021 (July to September) grew by 169.4% as compared to the RevPAR in the third quarter of 2020. This statistic was declared by the JLL consultancy which monitors the figures in the hospitality sector on a quarterly basis. There has also been a 122% increase in the RevPAR in Q3 of FY-2021 (April-June) when compared to the second quarter of 2021.
There are some obvious reasons for this immense growth in RevPAR. The first is of course the lifting of travel restrictions after the second wave of COVID-19. But we must also take into account that the net increase would not have been so high had the baseline not been so low.
What can we expect in the last quarter of FY-2021? Well, going by the present trend, the RevPAR figures are going to rise even further. IT companies are again pouring money into their travel expenditure budget. This signals that employees of these companies will start traveling across the country for work again. Plus, more vaccinations also mean more travelers. By now more than 50% of the adult population in India has received their double vaccination doses. It is evident from the news reports that locations like Sikkim, Himachal, Uttarakhand, etc. are already filling up with tourists.
32 hotels were signed in the third quarter of 2021. This meant a total of 2624 keys which resulted in a 13.4% increase compared to the Q3 of 2020. 15 of those new signings are converted old hotels. This counts for 47% of the new signings. The ratio of domestic operators to international operators is currently 57:43 with regard to their inventory volume.
The leader in the RevPAR department was Goa. It witnessed a 389.8% growth in the third quarter of 2021 as compared to the same quarter in 2020. This whopping growth owed much to the very low baseline score of 2020. Hyderabad won over all the states when it came to the highest rise in the occupancy rate. The occupancy level increased by 33.6% in the third quarter of 2021 as compared to Q3 of 2020. The rise in RevPAR for Bengaluru and Hyderabad was 213.2% and 173.5% as compared to the third quarter of 2020.
The demand of operational inventory in India’s six major cities witnessed a 159% growth in Q3 of 2021 as compared to Q3 in 2020. Similarly, supply grew by 9.5% in the same period.
Jaideep Dang, the managing director of the Hotels and Hospitality Group of South Asia, JLL, also spoke about the ‘sharp recovery’ that was witnessed in this quarter. Almost all of the holiday destinations were sold out on the weekends. Not just this, people started exploring new places in order to avoid the more crowded destinations. This led to the rise of tourism in locations that were not very popular before the pandemic.
Since the restriction on the number of people allowed to gather has relaxed, the demand for weddings is also growing. The F&B dining facilities are also performing better in the metro cities and the Tier-II cities. This obviously is the outcome of the growing number of vaccinations. As soon as corporate travel resumes its original volume, the hospitality industry will be back on track.