Forex inflow: India's hospitality sector booming
By agencies   |   Monday, 01 August 2005, 19:30 IST
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BANGALORE: International visitors are increasingly prepared to pay more for hotel rooms in India, reflected in the hospitality industry's growing forex earnings. Here's how the cake gets cut. Bangalore, despite fewer star rooms than Delhi or Mumbai, is generating far higher dollar yields from each guest. In fact, its hospitality business is said to often spill into neighbouring Chennai due to room shortage and high rates. In the last 12 months (July 04-June 05), the hospitality industry in India's silicon capital has earned more forex ($20.7 million) from global distribution system (GDS) sales than Delhi ($15.8 million), Mumbai ($15.2 million) or Chennai ($3.2 million). GDS and associated websites typically account for 30-40 percent of the rooms sold against dollar tariffs. Foreign guests account for 60-80% of a four/five star hotel's occupancy in major metros. Apart from GDS, other distribution channels that bring international guest business include corporate customers, travel agents, CRS platforms like Sabre, Galileo, Amadeus etc, and hotel websites. Bangalore's biggest advantage is the large community of international tech corporates who regularly fly into the city and patronise its hotels. At least for now, this stream of business shows no signs drying up, and is in fact said to be only growing year on year. According to Sangith Singh, head, Travel Click, the international hospitality intelligence agency, GDS revenues for Bangalore have leapfrogged 66 percent from about $12.4 million in July ‘03-June ‘04 to $20.7 million in the ‘04-05 spell ending June 30. The city's highest room sales on GDS was in May ‘05 at 9,361 rooms while the highest average room realisation (ARR) in any given month of $263 was achieved this February when the air show took place. The number of rooms sold through GDS also appreciated 18 percent to 91,066 room nights this year. Similarly, Delhi, which stands second in GDS dollar revenues, recorded 71 percent growth this season from $9.2 million to $15.8 million. The highest monthly ARR for the city was recorded in Feb at $194. The rooms sold through GDS grew by 37 percent to 1,00,000. Delhi has a five-star room inventory of 4,000-4,500. Mumbai, whose star rooms number over 6,000, was found to be inches behind Delhi in GDS revenues for the 12-month cycle. It clocked 50 percent increase in earnings, from $10.1 million to $15.2 million. The highest ARR for the city as a whole in any month is pegged at $167-168 during January. The number of rooms sold on GDS rose 35 percent to 1,04,713 room nights. Chennai is still a modest player on GDS room sales clocking $3.2 million, up from $2.3 million last year. Total rooms sold through GDS has also appreciated from 22,326 to 29,197 room nights.

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