Average daily room rates (ADRs) across India’s key hotel markets have remained resilient in the early part of Q2FY27, with easing geopolitical concerns and sustained domestic travel supporting pricing across major cities, according to a report by brokerage firm Nomura.
The brokerage, which tracks pricing trends across nearly 250 hotels in Delhi, Mumbai, Bengaluru, Hyderabad and Goa, expects ADR growth of 8-11% in Q2FY27, led by The Leela, followed by Indian Hotels Company Ltd. (IHCL). For Q1FY27, Nomura estimates ADR growth of 7-10% year-on-year for both hospitality companies, driven by healthy domestic leisure and corporate travel demand.
Among key markets, Bengaluru and Hyderabad recorded a recovery in room rates during July after stabilising in June following a correction in March and April. Delhi also returned to positive month-on-month growth, while Mumbai’s pricing remained stable.
Bengaluru emerged as the strongest-performing market, with ADRs increasing to ₹17,000-18,000 per night in July from around ₹15,700 in late June. The improvement was supported by robust corporate travel demand from the IT sector and Global Capability Centres (GCCs). Hyderabad also witnessed a sharp rise, with ADRs climbing to ₹15,000-15,500 from approximately ₹12,400 during the same period.
In Delhi, average room rates recovered to around ₹11,000-11,500 per night, compared with approximately ₹9,800 in late June, aided by event-led demand and reduced volatility arising from the West Asia conflict. Mumbai ADRs stabilised at around ₹13,700 per night, indicating that the market may have bottomed out after softening in June.
Goa remained the weakest-performing market, with ADRs hovering between ₹8,000 and ₹8,500 in mid-July, considerably below the ₹12,000-16,000 levels recorded during the peak tourism season between December and March.
Nomura expects IHCL to deliver around 9% ADR growth during Q2FY27, while forecasting approximately 8% growthfor ITC Hotels and 10-11% growth for The Leela. The brokerage has maintained a ‘Buy’ rating on all three hospitality companies.
While the brokerage cautioned that any escalation in the Middle East conflict could pose downside risks to travel demand during the quarter, it believes the sector will benefit from a relatively lower base in Q2FY26, supporting year-on-year growth in room rates.
Source : Money Control
