World Cup fever back in India — Zomato and Disney+Hotstar likely to benefit the most, hotel rates soar 150%

"World Cup, historically, in India and even overseas, whenever it's happened, it has not clashed with the festive quarter. This is the first time. So, there will be a big amount of ad spends moving towards the World Cup," Taurani told CNBC-TV18 on September 27. This might have a mild negative impact on peers like Sun TV Network, and Zee Entertainment, which are more GEC (general entertainment channel) focused, he explained.

He said sports will see a big win-win as far as ad spends are concerned and Star Sports and Disney+ Hotstar will be the biggest beneficiaries. (Star Sports has the broadcast as well as digital rights for ICC Cricket ODI World Cup 2023)

Taurani also believes that the consumption this time around will be better for the World Cup for digital with better growth expected on this front because one can catch up as per convenience. "The matches are eight hours and also, this time the World Cup is being offered free on the OTT platform," he said.

A room in ITC’s Fortune Park Hotel in Ahmedabad is priced at Rs 89,000 a night -- that's the cheapest. At the Leela in Gandhinagar, a room will cost at Rs 1.7 lakh per night + plus taxes during the World Cup period.

According to a note by brokerage firm Jefferies, the rates and fares for several hotels and flights have shot up by about 150 percent and 80 percent, respectively, for India match days.

As India is set to host 48 matches across 10 venues, Make My Trip data suggests bookings for hotels and homestays in cities where the Indian cricket team will play is seeing massive uptrend.

Rajesh Magow, Co-founder and Group CEO, MakeMyTrip told CNBC TV18, "To supplement the surge in homestays demand, we have strengthened our supply across all match venues, with a specific focus on Ahmedabad, where we have increased inventory by 31 percent, followed by Dharamshala by 15 percent and Lucknow by 14 percent.”

The blockbuster India and Pakistan matches will be played on October 14 at the Narendra Modi Stadium in Ahmedabad. For this particular day, bookings in Ahmedabad have seen a 200 percent increase, including for hotels and homestays, over the city’s average daily room night bookings in August 2023.

Reservations in Dharamshala where India will take on New Zealand on 22nd October has recorded a 605 percent jump above the daily average, MakeMyTrip said. Overall, Ahmedabad has witnessed a 800 percent surge in bookings, followed by Dharamshala with a 488 percent rise, and Lucknow with a 340 percent surge. Bookings in Chennai and Delhi are also growing significantly, the travel firm said.

Meanwhile, Jefferies also pointed out that the World Cup also coincides with the seasonally strong third quarter for the hospitality industry. Airlines are reportedly eyeing cap addition to target the traffic rush, it added.

Did you know that pizza is losing its top spot as the favourite binge snack?

“If you look at the market share numbers over the last 3-4 years, pizza has lost market share as a category within the overall QSR chain. It's a win-win for burger, fried chicken for aggregators like Zomato, over the near to medium-term,” Taurani said in an interview with CNBC-TV18.

Elara Capital's research analyst said that during World Cup 2011 and 2019, Jubilant FoodWorks ((Master Franchisee of Domino's Pizza in India) would have been the biggest beneficiary because of its best user experience in terms of delivery.

This time, Taurani believes Zomato could be the biggest beneficiary of the World Cup in the post-COVID era.

“We have seen adoption wherein delivery of food has moved to other categories and not just pizza. Zomato is able to replicate or even do better as compared to Jubilant in terms of the overall delivery experience,” he said.

Taurani added that Devyani International and Sapphire Foods India that have KFC franchisee will also see a positive impact. The last on his list of companies that would benefit was Jubilant FoodWorks.

According to him, Jubilant FoodWorks’ focus is now changing towards dining from delivery, because delivery is not growing faster given stiff competition from the likes of Swiggy and Zomato.

When asked if Elara Capital would like to change its reduce rating on the stocks of United Spirits and United Breweries, given the World Cup and festive season until Christmas and New Years’, Taurani said, United Breweries will see a positive impact because beer as a category has got higher on-premise share closer to about 30 percent. Therefore, UBL will see better volume growth in the October to December quarter.

But, he believes in terms of overall volume growth, United Breweries is struggling right now. “A lot of things have happened in UBL — management changes, scaling down in certain markets, local brands have also gained market share at the cost of UBL. So, UBL could just be one quarter of a small positive impact. But over the near to medium term, there are concerns, he explained.

For United Spirits, he said, only the upper prestige segment, Scotch or BII and BIO category, has a 40 to 50 percent on-premise share, so, there will be some respite there. However, in terms of overall contribution, it is quite miniscule, he added.

The kind of valuations, both these companies are trading at somewhere close to 50 to 53 times FY25 - we believe that a lot is priced in and one cannot see potential upside in the near term, at least,” he said.