The Indian hospitality sector will enjoy the world’s fastest hotel expansion, according to experts. The sector is estimated to be worth a stunning $300 billion in the coming years, with growth prospects anticipated to remain rather stable over the next decade. In addition, Hotel Stocks are projected to outperform as India’s tourism sector grows.
This article contains a list of the top Hotel Stocks in India, a summary of their performance, and considerations to keep in mind when investing in Hotel Sector Stocks.
Best Hotel Stocks in India 2024
Let us review the top Hotel Shares in India now that we have a better understanding of this industry.
| S.No. | Hotel Stocks List |
| 1. | Indian Hotels Company Ltd. |
| 2. | EIH Ltd. |
| 3. | Byke Hospitality Ltd. |
| 4. | Chalet Hotels Ltd. |
| 5. | Lemon Tree Hotels Ltd. |
Considerations Before Investing in Hotel Industry Shares
Before investing in stocks of listed hotel firms in India, there are some considerations to consider-
Heavy Dependence on Location, Economic Conditions, and Competitive Force
One major negative of being a hotel investor is the reliance of these investments on the economy, the location of the physical property, and the availability of close competition.
Most hotel guests are likely leisure travelers; thus, they must be able to afford such things. Consequently, hotels may experience a dramatic decline in the number of guests they can attract and the prices customers are willing to pay during difficult economic times.
Its location has a considerable impact on the hotel’s popularity. Even locales with a reputation for being popular with tourists are occasionally subject to unforeseen fluctuations in popularity. In addition, a nearby competitor could emerge or an existing rival would produce a more enticing offer, both of which could drive customers away from your hotel.
Dependent on Effective Administration and Leadership
Hotel investments’ reliance on effective management and informed operational decisions is yet another possible issue hotel investors may face.
The focus should be placed on staying abreast of industry developments and making sufficient investments in cutting-edge hotel technology. If an estate falls behind in terms of the software and equipment utilized by personnel or the technology given to visitors, competitors will certainly gain an advantage. In the end, guests will be favored by the establishment that gives a seamless, modern, and frictionless experience.
Hotel investors should always view a hotel’s physical location as a set. However, the success or failure of a hotel depends on its service quality and strategic decisions. Therefore, a competent management team and collaboration among all hotel divisions are essential.
Heavy Leverage of Capital Risk
Numerous hotel investors are lured into borrowing substantial sums of money for their ventures since this increases the likelihood of bigger returns. However, there is a possibility that the hotel will incur excessive debt.
If a hotel’s debt increases to the point where it cannot pay its interest and operational expenses, it is overleveraged. Borrowing more money increases the risk of paying higher interest rates, increasing the possibility of investment loss.
Suppose a hotel begins to encounter operational challenges, which can be caused by various external circumstances that are impossible to forecast or control. In that case, you will need funds to invest in your business. This will not be possible if you lose your hotel property due to excessive debt.
An Overview of the Leading Indian Hotel Stocks
1) Indian Hotels Company Ltd.
On the list of hospitality sector stocks, Indian hotel stocks are among the most sought-after. This is due to the fact that under the umbrella of the Indian Hotels Company Limited (IHCL) and its subsidiaries, many brands and enterprises offer warm Indian hospitality and superior service.
These include the trendy, affluent Vivanta hotels, the named hotel collection SeleQtions, and the luxury market-changing Ginger hotels. Obviously, Taj exemplifies legendary hospitality.
Jamsetji Tata, the founder of the Tata Group, established the company in 1903 with the opening of The Taj Mahal Palace in Bombay. IHCL’s portfolio includes 196 hotels, 40 of which are currently under construction throughout four continents, 12 countries, and more than 80 locations.
The Indian Hotels Company Limited (IHCL) is the largest hospitality company in South Asia based on market capitalization.
2) EIH Ltd.
EIH Limited manages the Oberoi Group, one of India’s largest luxury hotel companies. They operate hotels with the well-known brands Oberoi, Trident, and Maidens. Due to their individualized service, commitment to excellence, and attention to detail, they have attracted loyal customers and garnered recognition from the international hotel sector.
They are devoted to incorporating the most effective corporate social responsibility methods into their business operations. EIH Associated Hotels Limited (EAHL) is a member of one of India’s most renowned and distinguished hospitality industry groups. The business currently owns and runs ten five-star hotels under the Trident Properties brand and twenty exceptional hotels under the premium Oberoi Hotels & Resorts brand.
3) Byke Hospitality Ltd.
Byke Hospitality Ltd. is one of the fastest-growing hospitality organizations in India, with 21 hotels, 1,255 rooms, and a presence in nine states and sixteen cities. Due to its distinctive Pure Vegetarian Hotels & Resorts motif, The Byke is commonly chosen by guests seeking a cozy retreat.
They offer contemporary hospitality services with respect to the old Indian tenet “Atithi Devo Bhavah” With years of experience, the Bhavah’team is committed to providing our customers with the best possible business and leisure stays.
In light of TBHL’s strategic advantages, the stock price has yet to realize its full potential. Compared to its contemporaries, the preceding graph shows only 20% returns over the past year, providing ample potential for investment opportunities. TBHL is one of the best hotel stocks to purchase in India.
4) Chalet Hotels Ltd.
A subsidiary of K Raheja Corp Group, Chalet Hotels Limited operates seven five-star hotels in Mumbai, Hyderabad, Bengaluru, and Pune. In Mumbai and Bengaluru, Chalet Hotels Limited has well-known brands such as Marriott and Four Points.
In recent years, the share price of Chalet Hotels has climbed dramatically. As a result, it stands to benefit from India’s forthcoming tourism boom. Including a strong stocIndia’sCHL in your portfolio might increase your returns significantly.
5) Lemon Tree Hotels Ltd.
According to the Horwath Report, as of 30 June 2017, Lemon Tree Hotels (LTH) is India’s third-biggest hotel network overall and its largest mid-priced hotel brand.
This prestigious Indian hotel business comprises 87 properties in 52 locations, 8,400 guestrooms, and nearly 8,000 employees. In more than 87 locations in India, Lemon Tree Hotels Limited owns hotels ranging from Super Luxury to Economy.
In other words, Lemon Tree Hotels serve a wide variety of guests from all social classes; their audience is not limited to affluent vacationers. In addition, based on the graph, the share price of Lemon Tree has climbed substantially during the past few months. Given the operational scope and clientele of Lemon Tree Hotels, it is, therefore, a good purchase for you.
Conclusion
In the next months, the hotel business is one to monitor because demand is expected to be high over the forthcoming holiday season, and occupancy rates are rising. In addition, corporate action is expected due to the eventual sale of stalled or locked-up inventories.
