Indian Hotels says tariff hikes will have to wait until November. Here’s why
Several hospitality firms, including Indian Hotels, have recently said that they are eyeing price rate hikes, however, the Tata Group hospitality firm’s MD and CEO Puneet Chhatwal on Thursday said the price hikes will have to wait until November.
Several hospitality firms, including Indian Hotels, have recently said that they are eyeing price rate hikes, however, the Tata Group hospitality firm’s MD and CEO Puneet Chhatwal on Thursday said the price hikes will have to wait until November.
“The third quarter is really the decisive quarter, it has always been the best the strongest because of the festive season followed by the wedding season followed by Christmas New Year, everything happens for the best in our industry in Q3. So, rates and the increase in rates, we will have to wait till November to see if that's moving in that direction,” he told CNBC-TV18. He sees room to grow, not only since post COVID but for the last ten years
Chhatwal was confident that as long as demand continues to outpace supply, hotels will continue to have strong pricing power.
“If supply does it the other way around, it outpaces demand, then the rates are always under pressure. So at the moment, given what has happened in the COVID times I definitely feel demand will outpace supply in the major metros,” he said.
His remark comes days after he said he expects rates to continue to rise amid limited supply. He earlier said that across the globe, there's an increase in rates, and they may correct a bit towards plus 10 percent or minus 10 percent.
“Nothing else is going to change because the supply is going to remain constrained. Not many hotels have got built in the last two years, and when the demand begins to come back, it will continue to outpace supply in the market,” he had said, adding that Indian Hotels wants to benchmark its hotel rates to global levels.
Chhatwal noted that the hospitality sector has proven to be resilient with occupancies remaining at comfortable levels. He said that the second quarter of the fiscal will be one of the best quarters in the past five to six years.
He said Indian Hotels currently has a total portfolio of 240 hotels with 65 hotels in the pipeline and has given a guidance of 300 plus hotels, of which definitely no more than 30 will be outside of India.
“So, 290 as a portfolio will be India based, and hopefully next year sometime mid of next year, we will be opening our 200th hotel in operation. So, we are at 180 as we speak,” he said.
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First Published: Sept 29, 2022 9:21 PM IST
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