COVID-19: India hotel performance impact

The COVID-19 pandemic has severely affected the global hospitality industry, with countries and continents feeling the impact at various stages and to varying degrees. For the Indian Ocean markets, such as India, Sri Lanka and the Maldives, the effects were negligible until approximately the third week of February. In this article, we will focus on India, where strong domestic demand and relatively low COVID-19 cases contributed to February’s resilience. However, when the number of cases increased in the likes of Italy, France, the U.K., the United Arab Emirates and other key source markets, India’s hotel industry began to feel the strain.

In the image below with India’s key markets, red dots represent a RevPAR decline from February 2019 levels, while the green dots indicate growth.

In the first week of March (1-7), India reported a 12% year-over-year decline in hotel occupancy, and none of the country’s key markets reported a decline worse than 25%. However, as the below image shows, the following week (8-14) showed a 43% drop at a national level, and the decrease was much worse for several markets.

This was a result of rising COVID-19 cases in India, which forced central and state governments into actions. Measures to combat the virus included travel bans, revoked visas and restrictions of some states to operate at full capacity. What followed was hotel booking cancellations, in both the transient and MICE segments, as well as a curtailing of both domestic and international travel plans.

Understandably, the third week of March (15-21) brought further declines, and India’s hotel occupancy fell by 67% in comparison to the previous year, as reported by our preliminary data. Following a Janata Curfew trial on 22 March, Prime Minister Narendra Modi announced a full 21-day lockdown beginning on 24 March and further occupancy declines have followed. Our daily preliminary data shows occupancy declines exceeding 80% each day from 22-29 March, with actual levels hovering as low as 10-12%. Coupled with ADR declines ranging from 19-26%, RevPAR declines surpassed 85% on each day of this period.

For further insights into the impact of COVID-19 on global hotel performance, visit our COVID-19 hub.