India’s hotel performance recovery resumed early in 2022, but April seemed to be the turning point with the country outpacing pre-pandemic comparables in occupancy and average daily rate (ADR) for three consecutive weeks.

Leisure markets have continued to lead recovery, but business travel is also back in the country post-Omicron. Forward bookings also appear to be healthy for the remainder of May with most pickup remaining short-term.

20 straight days above pre-pandemic comparables

Running 7-day occupancy and ADR had been trending at 90% or better of 2019 levels since the latter portion of March, with occupancy eclipsing pre-pandemic levels as early as 23 March. From 16 April, however, the country would see its first of 20 consecutive days with both occupancy and ADR beating 2019 comparables.

Using preliminary data over the 20-day streak, running 7-day occupancy in absolute terms ranged between 65-72%, while running 7-day ADR has come in between INR6325-6484.

Leisure markets continue to lead recovery, but business travel is back

India’s most popular leisure markets, such as Himachal Pradesh, Goa and Uttarakhand have seen significant occupancy levels throughout 2022, most times exceeding pre-pandemic levels. However, the months following the Omicron peak produced significant demand with improved traveler confidence and easing of inter-state travel restrictions.

Business demand, which was limited after the Delta wave, has shown significant improvement post-Omicron with momentum accelerating in late April and early May. Not only have companies resumed travel, but MICE demand is coming back too.

Bengaluru and Pune, cities that are reliant on this segment historically, were some of the most impacted by the lack of business demand throughout the pandemic but are now among the markets showing the fastest demand growth. Mumbai recorded upwards of 80% occupancy on almost all days in April 2022.

ADR premiums

While business markets in India are maintaining ADR levels amid growing occupancy, leisure markets are leveraging incremental demand to drive premiums. Himachal Pradesh & Uttarakhand hotels have managed to at least double rates when compared with 2019.

The running 7-day ADR for India has been above pre-pandemic levels since mid-April and continues to grow gradually.

Future bookings

Looking ahead via Forward STAR, India’s hotel bookings are at solid levels. Pickup, the difference in bookings from one weekly reporting period to the next, shows a tendency toward shorter booking windows. That trend has been common throughout many global markets as a result of the pandemic.

An element of STR Benchmarking, Forward STAR completes the picture and adds to a hotelier’s historical view the future trends in demand and shifts in bookings affecting their market. The recent expansion of STR’s Forward STAR participation includes New Delhi, Chennai, Goa and Gujarat.