Business Daily from THE HINDU group of publications
Sunday, Aug 20, 2006


News
Features
Stocks
Cross Currency
Shipping
Archives
Google

Group Sites

Home Page - Marketing Research
Industry & Economy - Hotels
Hospitality sector — good times ahead

Our Bureau

CRISIL RESEARCH


The study predicts demand for hotel rooms to grow at a compounded rate of 10 per cent over the next five years.


A HOTEL ROOM

Mumbai , Aug. 19

A study conducted by Crisil Research has forecast a surge in hotel room rates well beyond the current highs. The report has also predicted good times for the hospitality industry over the next five years.

The study has predicted a rise in demand for hotel rooms in metros and developing cities. Occupancy rates are expected to increase from the current 74 per cent to 76 per cent and 77 per cent in 2006-07 and 2007-08, respectively. Average room rates (ARR) will, therefore, go up by 20 per cent and 10 per cent in 2006-07 and 2007-08, respectively.

Room supply additions

"Demand for hotel rooms will grow at a compounded rate of 10 per cent over the next five years. Room Supply Additions, the lead indicator of the hotel industry's competitive landscape is not very encouraging though. Room availability factor is only expected to grow at a moderate rate of 5 per cent over the next two years," said Mr Sudhir K. Nair, Head, Crisil Research.

The study, however, predicts that during the period between 2008 and 2011, the room availability factor would go up by 11 per cent.

"This bunching up of supplies post-2007-08 would dampen occupancy rates. This will bring down occupancy rates to as low as 55 per cent by 2010-11," Mr Nair said.

Cities in focus

According to the study, room demand growth in the next five years will be the highest in Bangalore, Hyderabad, Pune and Chennai. These are the cities that will witness the bulk of room additions as well.

Among business destinations, Delhi will continue to face a shortage of rooms over the next five years. No significant addition in room capacity is expected in the near future in Delhi, the report said.

Among leisure destinations, the report has predicted heavy shortage of rooms in Goa and Jaipur that will directly impact the ARR.

More Stories on : Marketing Research | Hotels

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page



PNB

Stories in this Section
PM for more jobs in manufacturing


Rashtriya Chem in expansion mode
HCL to invest Rs 500 cr on three new SEZs
Lord Krishna Bank to merge with Centurion
Tatas propose competitive bidding for 3G licence
Hospitality sector — good times ahead
CFTRI favours standards for all beverages


The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |

Copyright 2006, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line