Indian Hotels See Surge in Demand and Premium Rates

The industry is set for a robust FY25, buoyed by strong domestic tourism and rising demand for meetings, incentives, conferences, and exhibitions, besides a controlled supply pipeline

As the upcoming long weekend coincides with India’s Independence Day, the luxury hotel sector is witnessing a notable surge in demand and premium rates. Last-minute planners seeking a quick getaway are displaying a willingness to pay premium prices, with rates reaching at least ₹20,000 for a single night’s stay at top-tier five-star resorts across various destinations.

 

Leading luxury resorts are capitalizing on the extended break by strategically raising their rates. Taj Lake Palace in Udaipur, for instance, is offering a three-night stay package for ₹1.8 lakh for two people. Similarly, Rambagh Palace in Jaipur has listed a four-night stay at ₹5.9 lakh for two people. Even Fairmont in Jaipur is commanding ₹20,000 per night, a significant elevation from its regular off-peak weekend rates ranging between ₹5,000 to ₹15,000.

 

The allure of the long weekend has prompted a surge in travel plans, ranging from visiting family in hometowns to leisure trips. Hotels in the premium segment are experiencing occupancy rates ranging from 80% to 90%, and room rates are averaging 20-30% higher than usual. Marriott International has specifically noted a spike in demand for leisure hotels, with properties in popular destinations like Goa, Mussoorie, and the National Capital Region witnessing increased interest.

 

The surge in hotel demand is complemented by increased flight loads from major metros to tier 2 and 3 cities. Many travelers are utilizing the opportunity to visit their families. Airfares from major hubs such as Mumbai and Delhi to popular destinations have escalated by approximately 15-20% compared to the same long weekend period last year.

 

Travel platforms are reporting that domestic travelers are displaying advanced planning behavior, booking hotels around 28 days before their intended trips. Among the sought-after destinations for these bookings are Panjim, Jaipur, Coimbatore, and more.

 

Luxury and five-star hotels are particularly benefiting from this heightened demand, with rates soaring by around 25% above typical levels for the long weekend. The overall occupancy rate for five-star hotels is currently hovering within the impressive range of 85-89%, reflecting the strong desire of travelers to make the most of this holiday window.

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