Occupancies in India's hotels in Feb could have breached the 50% mark

The occupancy rate for India's hotels in the first month of 2021 was 29-31% lower compared with a year earlier, according to hospitality consultancy HVS Anarock.

Industry insiders said after the year-end frenzy in December, the performance of the Indian hotels sector was relatively subdued and grew marginally in January from the previous month. But they estimated February to have been a better month operationally for the sector, with occupancy levels possibly breaching the 50% mark for the first time since February last year.

"February is expected to be an even better month and we expect occupancies to reach the much awaited 50% levels on the back of a larger number of auspicious dates for weddings in the month, an even bigger boom in the weekend staycation business and the onset of some corporate travel in tier-2 and 3 cities besides the continued growth in leisure travel," said Mandeep Lamba, president, South Asia at HVS Anarock.

Preliminary data for February indicates that nationwide occupancy for hotels may just cross the 50% marker, a first after February 2020, industry tracker STR said. “Average daily rates are yet to see a visible improvement, still down by more than 30% in comparison to the same month last year. Goa is still the market leader with visible improvement in occupancy and average rates, even in comparison to January. The laggards in occupancy remain the same with slight improvements,” said Karan Mahesh, account manager, Central and South Asia, at STR.

As per STR, a gradual improvement in occupancy saw January close with 47.3%. Average daily rate was Rs 4,228, a drop of 32% when compared to January last year.

According to HVS Anarock, the revenue per available room (RevPAR) declined 52-54% year-on-year in January to Rs 1,900-2,100.

Goa continued to be the top travel destination with the highest occupancy and average daily rate inching closer to the pre-pandemic levels. As per STR, Goa remained the market leader in occupancy and revenue per available room. It was the only market to witness RevPAR of over Rs 5,000.

Chandigarh, Lucknow, Kolkata, New Delhi, Mumbai, Rajasthan and Visakhapatnam were the other markets that witnessed greater demand, recording occupancy in the range of 50-60%.

Kochi, Bengaluru and Pune were the laggards in occupancy, struggling to cross the 40% marker.

“The major issue is with the IT-driven markets such as Bengaluru, Pune and Hyderabad. Branded hotels occupancy rates are picking up in Delhi and Mumbai,” said Nandivardhan Jain, CEO of hospitality advisory firm Noesis Capital Advisors.