Madhya Pradesh leads growth: STR Global

India’s hotel industry showed overall year-to-date November 2011 growth in performance data and the supply pipeline, according to new figures from STR Global.

“India, with a population over 1.2 billion people and a growing economy, is allowing the Indian hotel market to prosper as hotel brands continue to expand their portfolio in the main cities and in the regions,” said Elizabeth Randall, managing director for STR Global.

Year-to-date hotel performance results showed that all major regions, with the exception of Kerala and Maharashtra, reported continuous RevPAR growth. Looking at the hotel pipeline, India’s hotel inventory is expected to increase by more than 61,000 rooms in the next three years with over 30,000 rooms currently under construction based on STR Global’s pipeline database.

Regional India

The central region of Madhya Pradesh reported the largest RevPAR growth at 19%, led by a 12.7% increase in occupancy year-to-date. The neighboring regions of Uttar Pradesh and Rajasthan saw RevPAR increase by 10.8% and 3.3%, respectively, driven by increased average daily rate in Uttar Pradesh of 2.8% to 5,527.43 rupees (US$107.36), while occupancy rates in Rajasthan increased by 6.8% to 40.8% during the same period.

In Kerala and Maharashtra, occupancy and ADR growth declined moderately year-to-date when compared to the same period last year. Demand in Kerala, following strong growth between 2009 and 2010 (16.3%), remained flat at 0.7% between 2010 and 2011. In Maharashtra, demand growth jumped by 10.6% year-to-date compared to a negative trend between 2009 and 2010.

Main Indian Cities

RevPAR grew across most Indian cities, with the exception of Chennai, which declined 1.1% and Delhi, which declined 10.6%. Chennai’s demand and supply increased almost in equal measures, 6% and 5.4%, respectively, making it more difficult to hold average room rates. Delhi reported the highest supply growth of 13% of the cities for the period. Likewise, Jaipur and Bangalore experienced stronger new supply growth compared to demand and saw their occupancy decrease year-to-date.

Leading the best performing markets in terms of RevPAR growth, Goa reported an 8% RevPAR increase, led by year-on-year demand growth of 4.1%. Second was Mumbai with the highest ADR of all Indian cities sampled at 8,450.84 rupees (US$164.15). This financial capital also saw demand growth reaching 9.1%.