Coronavirus impact: Hotel industry cuts growth forecast as revenues dip
NEW DELHI: Hotel chains and industry analysts are cutting back on their growth forecasts for the current quarter and are witnessing a dip in occupancies and revenues this month following the coronavirus outbreak with both business and leisure trip cancellations coming in by inbound travellers and future bookings getting stalled.Jaideep Dang, managing director, hotels and hospitality group at JLL, said hotels in India will continue to bear the impact from inbound travel as economic restart around South East Asia will take at least until second quarter of 2020.Indian High Commissions in South-East Asian countries — China, Hong Kong, Taiwan, Macau, Thailand, Singapore, South Korea — have restricted visas to travellers coming from these countries. Although India doesn’t have a lot of Chinese travellers but with all these countries included in the travel restriction bracket — the impact on hotel demand could be significant throughout first quarter of 2020,” said Dang.“We feel that outbound travel from India this year is likely to reduce and could get substituted by Indians travelling in domestic leisure markets.
Demand from weddings could continue to fill hotels. Business related conferences and meetings demand is likely to suffer,” he added.Investment information and credit rating agency ICRA said the domestic impact of the pandemic can be far reaching as witnessed around the 2003 SARS period when the Indian hospitality industry also witnessed a slump.“My sense after talking to people is February has not been a good month,” said Pavethra Ponniah, VP and sector head, ICRA.“There will definitely be trouble and there has been loss of business.
In February there have definitely been cancellations. Room nights are perishable. I don’t think it will lead to deferred travel till March. That might be for a little later. Even though China is not a big travelling partner for us, hubs like Singapore and other countries are. Places like Rajasthan, Kerala, Goa should see deferred leisure travel,” she added.An executive working at an international hotel chain said revenues at his chain’s business hotels were down by at least 10-15% in February.
Economic Times
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