Hotels start 2023 on a high, air travel demand stays robust

Hotels across India will likely carry on the strong booking momentum of the New Year’s Eve weekend through this month, buoyed by the Republic Day holiday and demand during the wedding season, including honeymooners.

Leisure travel tends to wane after New Year’s, but several travel companies are reporting that, unlike other years, demand for hotel rooms has remained robust in the first fortnight of this month.

According to Rategain Travel Technologies Ltd, which provides software-as-a-service (SaaS) solutions to the hospitality and travel industry, actual hotel bookings continued at a similar pace to that of the New Year’s Eve week, with most leisure cities seeing as much as an 80% jump in bookings compared to December. Also, most metro cities are seeing up to a 44% rise in bookings, according to Rategain.

Till the first eight days of January—the period mapped by Rategain for data on its transacting clients—Goa had 2,628 confirmed hotel booking rooms for January, up from 1,604 rooms booked in the last week of December, an increase of 39%.

Other cities, such as Dehradun and Chandigarh, saw bookings surge by about 60%, albeit on a smaller base. Among the bigger cities, bookings for Delhi and Mumbai rose by 23% and 32%, respectively. However, Ahmedabad saw a 29% drop.

Meanwhile, flight searches on travel search engine, Kayak, have increased for the Republic Day holiday, with domestic return flight searches up about 185% and flights to Asia rising about 12%. Searches for long-haul international flights rose about 24% compared to the same period in 2019.

At travel firm Thomas Cook (India) Ltd, hotel room occupancies after the New Year’s eve weekend is high at 80-85% at key holiday locations, with premium properties remaining sold out for popular locales such as Srinagar, Gulmarg and Pahalgam in Kashmir; Shimla, Manali and Dharamshala in Himachal Pradesh; Udaipur and Jaisalmer in Rajasthan; Coorg, Coonoor and Munnar in the south; as well as beach destinations like Goa and Andaman.

“Tariffs continue to remain significantly high, and we expect this to continue with the long weekend coming up during Republic Day; additionally, this being the weddings and honeymoon season as well,” said Rajeev Kale, president and country head for holidays, MICE, Visa at Thomas Cook.

However, in some segments, especially big cities, the market has seen a 10-15% correction in flight bookings, which has pushed many airlines to start sales promotions. “But since we are expanding our business, our numbers are 10% more on flights as compared to the same period in December, and about a 10-15% is the increase in bookings for hotels than what we reported in December,” said Ayyappan R., CEO of Flipkart-owned online tour operator Cleartrip.

Hotel occupancy levels and room rates at SOTC Travel, part of Thomas Cook (India), have remained unchanged after New Year’s eve and across locations such as Kashmir, Himachal Pradesh, the Northeast, Rajasthan, Kerala, Goa and Andamans; besides spiritual destinations like Varanasi, Rishikesh, Vaishno Devi.

“This high demand is indicative of high pent-up demand and sustained travel appetite. The average room rates for top leisure destinations are at par with 2021 levels equating to 50-100% over pre-pandemic levels,” said Daniel D’Souza, president and country head for holidays at SOTC.

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