Overview

• Fiscal 2026 growth is forecast to slow to 6–8 percent after three years of double-digit gains reflecting a return to baseline on a high revenue base.
• ICRA projects premium hotels to maintain occupancy near 73 percent and push average room rates up to Rs 8,200–8,500.
• The sector has rebounded from April’s terror-related cancellations in North and West India with a recent uptick in booking sentiment.
• Foreign visitor numbers are set to remain muted in coming months even as domestic tourism sustains overall demand.
• New room supply is likely to lag demand for the next 12–18 months because land scarcity constrains premium market expansions.