Chennai: The Opposition parties may be criticising the Centre for its "poorly designed" Goods and Services Tax (GST), but the uniform tax regime appears to have benefited the hotel industry at least, if the market indications are to be believed. The city of Chennai has benefited from this and is on the threshold of becoming the fourth city in the country to cross the 10,000-room mark in 2018.
At the national level during 2018, occupancy was the highest for the last 10 years and average daily rate was the highest since 2012, the India Hotel Market Review reported.
The RevPAR (revenue per available room) for Mumbai, Hyderabad, Pune and Jaipur was the highest in the last 10 years; for Ahmedabad, Bengaluru and Delhi the highest since 2010, 2011 and 2012 respectively, it said.
On an average, 90,000 rooms were sold per day by hotels in India. Among the cities, Bengaluru had the largest inventory crossing 14,000 rooms.
The report released jointly by STR and Horwath said Delhi and Pune had joined Mumbai, the only city in India to cross the 70 per cent hotel occupancy. Delhi has "grabbed the opportunity presented by GST replacing a luxury tax with both hands," the report said. It had performed well in all the performance parameters like occupancy, ADRs and RevPAR, the report said.
The occupancies reached 71.7 per cent accompanied by 7.5 per cent growth in ADR and 11.6 per cent growth in RevPAR, which is highest amongst Indian cities.
Pune, on the other hand, had a good year in 2018, crossing 70 per cent occupancy and pushing through over 7 per cent ADR growth to post 11 per cent RevPAR increase.
Among the 13 cities from which data has been compiled, Delhi registered the highest RevPAR change year on year at 11.6 per cent, followed by Pune 11.1 per cent and Hyderabad 8.6 per cent. Kochi and Goa had shown a negative growth in RevPAR, of 3.6 per cent and 0.9 per cent respectively.
MICE (meetings, incentives, conferences, and exhibitions) and weddings will remain key business elements, although APC levels could harden in the near and medium term, the report said.
The power of event-driven demand is now evident in more cities, the report pointed out. Ahmedabad gains from specific conventions and conferences, Bhubaneswar from the World Cup hockey event and Kolkata from football. The leisure sector remained under-served with only 19% inventory with potential for new investments in the segment.
Room rate and occupancy positivity were strong across all segments, highest being in the mid-scale and economy segment of the hotels at 6.62 per cent. Food and beverages (F&B) and banquets continued to carry significant revenue share, increasing even at lower-tier hotels, the report stated....