The report noted that the industry maintained strong momentum in September, driven by higher room rates, resilient domestic travel demand and increased activity in meetings, incentives, conferences and exhibitions (MICE). However, growth could ease in the coming quarter as year-on-year comparisons become less favourable.
Jefferies stated that while RevPAR growth may moderate in the third quarter as the comparison base improves, the strong wedding calendar in calendar year 2027 could help sustain healthy industry performance in FY28.
India’s hotel industry recorded a 19 per cent year-on-year increase in RevPAR in September 2026, compared with 18 per cent growth in the second quarter of FY27. Growth stood at 16 per cent in the first quarter of FY27 and 7–8 per cent in the fourth quarter of FY26, the report said.
The September performance was supported by a nearly 13 per cent year-on-year rise in average daily room rates (ADRs), while occupancy levels increased by approximately 6 per cent. Strong domestic travel, MICE-related demand and a gradual recovery in foreign tourist arrivals also contributed to the growth.
Major events, including BRICS, the Global Fintech Fest and Semicon India, further boosted hotel demand during September. The busy event calendar strengthened MICE activity and supported occupancy and room rates, particularly in Delhi and Mumbai.
Across key domestic markets, Delhi led the growth with a 37 per cent year-on-year increase in RevPAR, followed by Rajasthan at 33 per cent. Mumbai and Hyderabad recorded growth of around 19–20 per cent, while Bengaluru registered a 14 per cent increase. Goa, meanwhile, reported a slower growth of 3 per cent following stronger performance between May and August.
Jefferies maintained a positive outlook on the hotel sector but highlighted the moderation in growth during the upcoming quarter as a key factor to monitor. The industry’s performance in FY28 will depend partly on whether sustained travel demand and wedding-related activity can offset the impact of a higher comparison base.
