India's Hotel Gold Rush: Inside the Soaring Room Rate Surge

The Indian hotel industry is witnessing unprecedented growth, with average room rates (ARRs) for premium hotels projected to rise by 8% year-on-year to ₹7,800–8,000 in FY25 and further to ₹8,000–8,400 in FY26. This surge is driven by robust domestic leisure travel, MICE events, and business travel. Occupancy rates are also expected to climb to 72-74% by FY26. Despite challenges like limited foreign tourist arrivals and supply constraints, demand from tier-II cities and spiritual tourism is fueling the momentum. Industry revenue is forecasted to grow 7-9% in FY25.
Source: Financial Express