What is the impact, looking back, upon Indian hospitality industry – witnessing the last two years’ challenges? DI caught up with K.B. Kachru, Chairman Emeritus & Principal Advisor, Radisson Hotel Group-South Asia to get his impressions on the industry pipeline and growth aspect.
In the Covid breakdown, what has been the impact on the Indian eco-system?
“The past few years have been particularly challenging for the hospitality sector, but this hasn’t taken away the growth opportunities. In fact, the only way to see continued success is to prepare for these inevitable changes and challenges. A recent Hotelivate study has forecasted that by FY 26, the nationwide inventory of hotels in India is expected to increase by 19%. The horizon looks bright for the upscale and economy segment (23% respectively) followed by midscale (17%) and luxury (7%). A majority of the nation’s organized inventory sits in the mid and upscale space and shall witness a recovery that is marginally slower than the hotels at the top and bottom of the pyramid,” he says.
How do you see recent trends, especially in terms of profile of the Indian customer?
“Travel trends like staycations and workcations have opened the doors to experiential travel and accommodation in the country which is delivered well via boutique and independent hotels and resorts. According to a social tables survey, 55% of global travelers say that they are more determined than ever to choose sustainable accommodation than they were last year — but a lack of appealing options makes it difficult to put this into practice.”
Is this making any difference to Indian supply side? Do we see some tangible growth happening?
These independent hotels and resorts represent a strong pipeline and capture 10-12% of the market share in India and present a significant opportunity for hotel chains to tap this potential for delivering a unique experience to travelers.
Do we see new destinations coming up in the country? Like new emerging holiday spots?
Yes, for sure, there is a heightened interest among travelers for exploring unique destinations like Kumbalgarh, Gokarna, Varkala and Tawang, among other gems our country has to offer. This further helps in building a strong pipeline of quality accommodation in these markets and offering a fillip to the hospitality sector’s recovery in the years to come. These upcoming secondary and tertiary markets will drive the next phase of growth for the country’s hospitality ecosystem by leveraging the fresh pipeline of hotels and resorts.
The next five years will result in a balanced distribution of business between leisure-focused homestays, and independent hotels and resorts to meet the diverse needs of travelers. The industry may utilize the next three to four years to get back to where it was pre-COVID as multiple variables affect the trajectory of this recovery. This makes it even more important to acknowledge the silver lining and seize the opportunities that COVID-19 provides: to create more resilient operations; deeper, digital guest relationships, and a refined set of strategic priorities aligned with today’s traveler.
Overall, where is this growth going? More specifically, where does Radisson fit into this emerging scenario?
We believe hospitality will be a sunrise industry in India. The next five to 10 years will see a significant number of new destinations emerging, especially in tier III, IV, V cities and leisure markets. We see exponential demand for high-quality lodging accommodation in India, driven by the vast infrastructural development planned across the country and young, discerning travelers looking for unique experiences. At Radisson Hotel Group, we are fully prepared with our strategies to take on this exciting future growth opportunity that India has to offer.