The new Chambers lounge, with the whiskey bar in the background Hotel stocks
rallied up to 8 per cent on the bourses in Friday's intra-day trade as the Indian hotel industry is reporting a consistent and rapid recovery in occupancies after a dull period amid the second wave of Covid-19. Further, a recovery in the business travel and permitting foreign tourist to travel in India would further give a boost to the occupancies in the quarters ahead, analysts say.
On Thursday, the government said India will issue fresh tourist visas to foreign nationals coming to the country in chartered flights from October 15. Foreign tourists travelling to India by flights other than chartered aircraft will be able to do so from November 15, said a statement by Home Ministry.
Indian Hotels Company, Chalet Hotels, Lemon Tree Hotels, Royal Orchid Hotels, EIH and Taj GVK Hotels & Resorts gained 5 per cent to 8 per cent on the BSE in the intra-day trade today. In comparison, the S&P BSE Sensex was up 0.58 per cent at 60,026 points at 09:50 am.
Among individual stocks, Indian Hotels Company hit a record high of Rs 211.50, surging 8 per cent in the intra-day trade. The stock of the Tata Group company surpassed its previous high of Rs 200.90 touched on September 27, 2021.
Brokerage firm Sharekhan has a 'Buy' rating on Indian Hotels Company with a revised price target of Rs 215 as rapid vaccinations lifted domestic leisure travel, helping occupancies to scale up to close to 60 per cent in July 2021 and further improve in August.
India's occupancy rates were trending upwards of 60 per cent during July-August 2021 after having dropped to 20 per cent in May. International markets
such as the US and the UK have seen a significant improvement in occupancies in the recent months.
"With strong room inventory, Indian Hotels Company will benefit from a robust recovery in domestic leisure travel. This will be further boosted by a gradual recovery in the business travel and permits for foreign tourist arrivals. With focus on Asset-light model, Indian Hotels Company aims at reducing debt substantially through improved cash flows and equity infusion," the brokerage firm said.
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