Voices from the industry

Most industry leaders are upbeat. 

Hotel development in Tier II and Tier III towns will continue to be the theme on the back of micro economy, trade, pilgrimages, and improving connectivity through highways and new airports, feels Jaideep Dang, Managing Director Hotels and Hospitality Group, JLL India. “With the development of hotels around new airports in Tier I cities and emerging business cities—The Aerocity Model—the midscale and budget sector will be the largest direct beneficiary of this growth.

"The sector is also looking at how the demerger of ITC Hotels from its parent company, ITC will play out. Jeffries has predicted that as companies aim to capitalise on the positive sentiment for the Indian hospitality sector, the public listing landscape for hotels in India is likely to attract more listings. Besides ITC, other listings expected this year include those by Schloss Bangalore,  the Brookfield Asset Management-backed parent company of The Leela Hotels; owner and developer Brigade Hotel Ventures, which operates several hotels, largely in Bengaluru; and owner Ventive Hospitality. IPO/listings will continue as investors have taken a liking to the hospitality sector given its stellar performance of the recent past and listing gains,” points out Dang. “However, valuations would need to be measured. Boutique resort developments will continue to gain prominence as domestic travellers explore India.”

Manav Thadani, Founder and Chairman, Hotelivate opines: "With most markets continuing to record strong occupancies and amid average daily rate (ADR) growth, we do not expect too much pressure to be exerted by new supply. As a result, hotels should be expected to continue their strong performance and record ADR growth of over 7-8% in 2025.”

Dang points out that there are early signs of slowing down of GDP growth, which may lead to reduced travel allowances and discretionary spending on travel and leisure. “Demand growth continues to outpace supply growth. However, the pace of growth will be more measured owing to a higher base effect. Domestic tourism will continue to dominate demand growth, while Foreign Tourist Arrivals still await complete recovery to pre-COVID levels. Free or easy visas and attractive travel and lodging pricing of surrounding markets such as Thailand, Vietnam, Kazakhstan, and Middle Eastern countries—which provide more options, variety, culture and experiences—could further impact Indian leisure markets such as Goa, unless we correct course on pricing—including the increasing cost of domestic air travel.

“Demand in travel will continue to be supported by enhanced infrastructure and air connectivity, backed by a strong commercial office sector outlook and the opening of multiple new convention centres across the country,” adds Dang. “There will be growth in occupancies in certain micro-markets but not across the board. Rate growth could only be restricted to certain leisure markets like Rajasthan, especially in luxury and experiential segments as the rupee depreciates against the US dollar, which will make such destinations more attractive to foreign travellers. Similarly, the MICE segment, especially social/ weddings will continue to grow as overseas destination weddings will get expensive because of rupee depreciation against the US dollar.”

Anuraag Bhatnagar, Chief Executive Officer,  The Leela Palaces, Hotels and Resorts states: “The Indian hospitality industry in 2025 will be shaped by a growing demand for experiential and premium travel. Segments like heritage, wildlife, spiritual, and wellness tourism are expected to see continued momentum, reflecting a shift in consumer preference toward immersive and curated experiences. Increased domestic travel, driven by rising disposable incomes and government-backed tourism initiatives, will remain a key driver. The luxury hospitality segment, especially in Tier II and Tier III cities, is poised for growth due to improving connectivity and infrastructure. Additionally, the revival of MICE travel and the increasing popularity of destination weddings will also play pivotal roles in defining the industry’s trajectory.

Factors impacting Indian hospitality

Several key factors will impact the pace of growth in the hospitality industry in the coming years, points out Saxena. “On the positive side, evolving traveller preferences, especially the shift from destination-centric to experience-driven journeys, are likely to accelerate growth. South Asia, with its rich cultural heritage and diverse offerings like Ayurvedic wellness retreats in Kerala and culinary trails in Rajasthan, is well-positioned to cater to this demand for immersive, personalised experiences.

"Additionally, rising disposable incomes and improved infrastructure in Tier II and III cities are driving significant growth in emerging markets. These regions offer immense potential for hospitality development, with opportunities to provide world-class services across a variety of product types, including luxury, focused, and full-service hotels. However, challenges may arise in areas like over-reliance on certain markets, regulatory hurdles, and the need for sustainable practices. While innovation and new technologies in guest services and operations are enhancing the industry's adaptability and efficiency, these advances must be carefully integrated to maintain service quality and meet evolving consumer expectations. Overall, the industry’s pace of growth will be largely influenced by its ability to tap into new markets, adapt to shifting traveller demands, and implement technology and sustainability measures effectively.”

Another key trend is increased reliance on technology, including robotics, points out Ajay Bakaya, Managing Director, Sarovar Hotels & Resorts.  “While India has a large population, there's a growing labour shortage in the hospitality sector. Robots can help with tasks like cleaning guest room corridors and banquet halls, especially during off-peak hours, to address the staffing challenges in hospitality. We may even see robots being used in some hotels for guest interaction, like delivering drinks, mainly for the novelty factor or a bit of drama and adding a 'wow' factor. We will see more hotels being developed within a two to four-hour driving distance from major cities. This is due to lower land costs and the desire for quick getaways, especially with rising stress levels and increasing airfare which makes road travel a far better option.”

On a growth trajectory

Bakaya anticipates similar growth for the next four years. “Factors like infrastructure development, a stable government, and consistent policies all contribute to this positive outlook. We are failing to attract foreign travellers and that is sad. We need to create conditions where foreign travellers will want to come to India. Despite a strong domestic market, we need to promote India internationally. Domestic tourism will remain strong, but destinations like Goa need to improve their infrastructure and tourist-friendliness. Outbound travel will likely grow due to easier visa processes and affordability, but domestic travel will remain the dominant force.”

Sarovar has major expansion plans in 2025. “We currently operate 135 hotels across 80 destinations, with an ambitious pipeline of 15 new properties slated for 2025. We aim to expand our footprint to 150 hotels across 90 destinations. Notable upcoming projects include Sarovar Portico in Sindhudurg, Royal Tulip in Kathmandu, and Sarovar Premiere in Srinagar, among others. We are expanding into Nepal with three hotels, including the largest in the country. We've been working on this for 10 years, and it's finally coming to fruition. We are also opening hotels in Kampala, Uganda, and Hargeisa, Somaliland. We aim to grow in Africa, although it's a challenging market.”

The growth trajectory we saw in 2024 is likely to continue in 2025, propelled by strong domestic tourism, the increasing spending power of India’s middle class, and strategic government initiatives like the development of cultural corridors and enhanced infrastructure, says Nikhil Sharma, Managing Director and Area Senior Vice President, Radisson Hotel Group South Asia. “The growing popularity of Tier II and Tier III cities is another factor fuelling this expansion, as travellers explore beyond metros in search of authentic and less commercialised experiences. Our presence in these regions reflects our confidence in this trend. Several factors will shape the Indian hospitality landscape in 2025, with technology playing an increasingly pivotal role. From AI-driven personalisation to seamless, app-based services, technology will continue to enhance guest experiences, making stays more intuitive and tailored. Travellers now expect more convenience and flexibility, which digital tools can deliver effortlessly.

“The Indian hospitality industry is undergoing a significant transformation, driven by evolving traveller preferences,” underscores Sharma. “In 2025, we will see an increased focus on personalisation, sustainability, and immersive experiences. Guests, today, are looking for more than just a place to stay—they want meaningful connections to the destinations they visit. This means hotels will focus on offering authentic local experiences, from incorporating regional design and architecture to curating menus inspired by local cuisines. Sustainability will also be at the forefront. Travellers are becoming more eco-conscious—and hotels must adapt by employing green technologies, reducing single-use plastics, and supporting local communities. Wellness tourism is another trend gaining momentum, with guests seeking properties that prioritise mental and physical well-being through offerings like yoga retreats, spa therapies, and nature-based activities. While global economic uncertainties may pose challenges, our diversified portfolio and adaptability ensure we are well-positioned to navigate them. We remain optimistic about the resilience of the Indian hospitality sector. At Radisson Hotel Group, we’ve strategically expanded our footprint to 130 operating hotels across India, with a strong pipeline for the future. By combining innovative guest experiences with operational excellence, we are well-equipped to sustain growth while delivering exceptional value to our guests.”

India’s growth story is the wind beneath our wings, says Anil Chadha, Managing Director, ITC Hotels Limited. “The nation is witnessing a golden era of development, from rising disposable incomes and urbanisation to improved infrastructure and government initiatives promoting tourism. Each of our brands is poised to ride this tide, contributing to our growth in its unique way. The future demand drivers for tourism seem to be working well for the Indian market. ITC Hotels is looking at accelerated growth taking the current rooms count up from 13,000 keys in 140 hotels to 18,000 keys in 200 hotels by 2030 via the asset right strategy,” says Chadha. “Our brands—Welcomhotels, Storii, and Fortune—are positioned to drive scale and growth in Tier II and Tier III cities. We currently have a strong pipeline of managed hotels i.e. 45 hotels with about 4,000 keys across brands. Among these, 25 hotels are expected to join the operating portfolio in the next two years (upcoming hotels: Storii Sirmaur, Storii Kufri, Fortune Pahalgam and Welcomhotel Prayagraj).  On the other hand, our luxury brands—ITC Hotels and Mementos—will continue to be our flag bearers for the luxury portfolio. These hotels are more than just properties; they are destinations in themselves.

"Moreover, the flexibility of our brands allows us to collaborate with hotel owners across different geographies, property types, and scales. Whether it’s a luxury resort in the hills or a mid-sized business hotel in a metro, we have a brand that caters to the respective segment. The demand drivers are robust—be it the booming MICE segment, the rise of experiential travel, or the increasing popularity of wellness tourism. Going forward, the appetite for experiences is only growing. Today, travellers are willing to spend on curated stays, culinary adventures, and cultural immersions rather than just ticking off destinations.”

Vijay Thacker, Managing Director, Horwath HTL India, also expects the positive trend for hospitality to continue in 2025, thanks to greater business travel and greater inbound demand. "The sentiment is positive and that itself helps maintain buoyancy. At the same time, key issues must be tackled so that a stronger framework and grounding are put in place.”

K B Kachru, President, Hotel Association of India and Chairman, Radisson Hotel Group South Asia identifies leisure and business travel, weddings and events as the main drivers for the sector’s continued growth. “The demand outlook is healthy, supported by several factors such as enhanced infrastructure, including convention centres, roads, airports and rail that have improved connectivity; growth in Tier II and Tier III cities; India’s burgeoning middle-class taking more than three leisure trips in a year; and events like Maha Kumbh and the Coldplay concert, in addition to the demand for weddings and other events.” For the fiscal 2023-2024, he highlights, the branded and organised hotel sector in India closed with a nationwide occupancy of 67.5%, with a record high ADR of ₹8,055 and a RevPAR of ₹5,439, just short of the lifetime high achieved in 2007/08. Reportedly, the supply is expected to grow at a CAGR of 4.5-5%, lagging demand—and this will improve yields as well. 

The few and scattered clouds that could threaten an otherwise bright and shiny 2025 are perhaps the spread of HMPV, subdued GDP growth, the continued turmoil in the world and escalation of wars, points out Kachru. “India’s fundamentals and demographics are strong, and we are optimistic about maintaining the momentum in growth against all KPI like Occupancy, ADRs, RevPARs, signings and oppenings of hotels. Location specific/hotel specific variations, however, are to be expected.”

Indian hospitality is expected to see a 7-9% revenue growth in FY2025, over the 19% growth in FY2024, estimates ICRA. It is especially optimistic about domestic leisure travel, MICE demand, weddings and business in FY2025. In the face of stagnating inbound travel, domestic travel is expected to again take centre-stage this year, it predicts.

India’s growing economic clout means there are a lot of business and trade events too, many of which see participants travel from around the world.

What Indians will travel for?

More dates, more weddings

The panchang or the Hindu almanack is smiling on India in 2025. Compared to 30 wedding days in the second half of last year, the corresponding period this year has 41 such dates. In the last quarter of the year alone, the number of auspicious dates has risen from nine in 2024 to 13 this year. Meanwhile, the first half of 2025 has almost the same number of days that you generally have in a full year, a wedding expert points out.  

An increased number of auspicious dates has a direct bearing on the travel and hospitality sectors due to the large wedding party sizes in India. The Confederation of All India Traders (CAIT) had put out the number of weddings in India to be around 48 lakh in November and December 2024, with the corresponding revenue spend to be ₹6 lakh crore, according to CAIT.

At the recent FHRAI event, Mugdha Sinha, Director General of Tourism at the Union Ministry of Tourism, pointed out the immense potential of the Indian wedding sector for the travel and hospitality sectors. “When we look at spends, over 54% of Indians spend more than ₹10 lakh on average. In India, 45% of the population out of the total 142 crore Indians are married and 31 billion Indians are middle class. We are in the age of affluence and there is more disposable income, so there is money to host all the destination weddings. There is scope of tourism happening around weddings.”

Leveraging the sports calendar

Indians are likely to travel for a number of sporting events in 2025.

In badminton, the India Open, which draws major international players, has already happened in Delhi from January 14 to 19. It coincided with the debut Kho Kho World Cup, which was held from January 13 to 19 in Delhi, again. While there might not be much global interest, or awareness, of this traditional Indian sport, the tournament featured 20 men's and 19 women's teams from around the world.

Cricket is the largest revenue earner, and while the upcoming ICC Champions Trophy (February 19 – March 9) will be held in Pakistan, India’s matches will take place in the UAE, which is expected to see a significant number of Indians travelling to the Emirates. While women’s cricket, unfortunately, does not match the men’s counterpart in terms of revenue, there is definitely growing interest, and India’s hosting of the Women’s ODI World Cup in August is expected to generate interest. The English men’s team is touring India from January 22 to February 12. Of course, the biggest revenue earner, the Indian Premier League (IPL) is scheduled from March 14 to May 25.

The World Para Athletics Championships is scheduled to take place in Delhi from September 26 to October 5. This means a huge influx of athletes and support staff.

India’s national hockey has a major event coming up. Men’s Hockey Asia Cup will take place from August 27 to September 7 in Rajgir. Bhubaneswar, meanwhile, will host the FIH Pro League from February 15 to 25.

In tennis, the Davis Cup World Group I play-offs will take place in Delhi on February 1 and 2. Chennai Open follows soon after, from February 3 to 9.

In squash, the WSF World Cup is scheduled for December 9 to 14 in Chennai.

India is also scheduled to host the ISSF Junior World in shooting, though the venue has not been revealed yet. The venue decision is also awaited for table tennis’ ITTF-ATTU Asian Teams Championships, scheduled for October 11 to 15.

Indians are also expected to travel abroad for sporting events, not just for cricket, but also events for football, tennis, F1, chess, badminton and other sports. 

Domestically, the National Games and the Khelo India Youth Games are also scheduled, and expected significant movement within the country.

The festival calendar

Cutting across segments, right from the Chennai Music Season to EDM festivals in Goa, art shows, literature festivals, craft fairs, heritage walks and multi-disciplinary events such as the humongous Serendipity Arts Festival (SAF), Goa, provide several avenues to those wishing to immerse themselves in the smörgåsbord of the country’s cultural offerings. For instance, the International Kite Festival 2025, which was held in the second week of January in Ahmedabad, saw the participation of 143 kite flyers from 47 countries.

An early event, of course, is the gigantic Maha Kumbh 2025, which is expected to draw between 400 and 450 million people, as per government estimates. For the religious congregation, which kicked off on January 13, and will continue till February 26, about 1.5 lakh temporary accommodations have been created and a huge number of extra trains and flights have been scheduled as well.

The largest art fair in the country, the India Art Fair will take place from February 6 to 9, 2025, and is expected to see participation from international galleries. The inaugural India Art Fair Contemporary will take place at Jio World Garden in Mumbai from November 13 to 16, 2025.

Kala Ghoda Festival, the largest multi-disciplinary street arts festival, is set to return for its 25th silver jubilee edition. SAF is held annually in Panjim in December, and plans are already afoot to mark its 10th edition in a big way. While Indians are known for their love of cinema, film festivals have only recently begun to take off. The 19th edition of the Mumbai International Film Festival (MIFF) will take place in June.

While Indians have long travelled abroad to see their favourite music stars, 2025 will see a number of them perform in India. Lollapalooza India 2025, to be held in Mumbai, is scheduled for March 8 and 9, will see marquee names such as Shawn Mendes and Green Day. Coldplay will perform in India in January as part of their Music of the Spheres world tour, which will take place in Mumbai and Ahmedabad. Ed Sheeran is set to perform in India as part of his Mathematics Tour, which will cover six cities (Pune, Chennai, Bengaluru, Shillong, Delhi-NCR and Hyderabad) between January 30 and February 15. Linkin Park will visit India in February as part of their From Zero world tour.

Homegrown music festivals, held across the country, also see people travel from far and wide to attend, spurring travel and stay rates at their destinations, especially if they are held in smaller towns. This includes the Sunburn Festival (Goa, December), Bandland (Bengaluru, November), Ziro Music Festival (Ziro, October), Hornbill Music Festival (Kisama, December) and NH7 Weekender (Pune, December), amongst others. Jodhpur Riff Festival will return in October, while the Mahindra Kabira Festival is held annually in December in Varanasi.

Literature festivals have laid roots in almost all of India’s major cities. Kolkata’s top literature festival, Apeejay Kolkata Literature Festival, held at Allen Park from January 10 to 12, featured over 120 distinguished writers, including William Dalrymple, Ramachandra Guha, and Shobhaa De. The mega literary event, the Jaipur Literature Festival, which pushes up hotel rates significantly in the city, and sees attendees from many parts of the country and the world, will take place from January 30 to February 3. Odisha’s premier literature festival, Kalinga Literature Festival, will be hosted in Bhubaneswar between February 9 to 11. The sixth edition of the Mathrubhumi International Festival of Letters returns to Thiruvananthapuram, Kerala, from February 6 to 9, 2025. Meanwhile the Kerala Literature Festival is on from January 23 to 26 in Kozhikode. The 14th Edition of the Bangalore Literature Festival is scheduled on December 6 to 7.

A related mega event that draws millions of people is the New Delhi World Book Fair (NDWBF) which will be held from February 1 to 9. Meanwhile the largest book fair in the country, The International Kolkata Book Fair will host its 48th edition from January 28 to February 9.