New Delhi: The Maha Kumbh mela has come as a boon for the hospitality sector and airlines with profits expected to firm up amid soaring demand. This is being reflected in the rise in the share prices of companies such as Benares Hotels, a subsidiary of the Tata Group’s Indian Hotels.
The share price of Benares Hotels Ltd in the morning trade on Wednesday went up to Rs 10,610.00 on the BSE which represents an 11.50 per cent increase from the previous closing price of Rs 9,552.95 on Tuesday.
The stock price of this smallcap hotel company has been rising amid decline in the BSE Sensex and smallcap segment.
Benares Hotels Ltd operates Taj Ganges and Taj Nadesar Palace in Varanasi and Ginger, Gondia in Maharashtra. The Indian Hotels Company Limited (IHCL) is the ultimate Holding Company of Benares Hotels.
For the third quarter (October-December), Benares Hotels announced a 20 per cent year-on-year (YoY) increase in net profit at Rs 13.6 crore. The company’s revenue rose 16.2 per cent to Rs 40.1 crore during the quarter.
According to the company, the Kumbh Mela and related travels in the region have led to an increase in domestic demand and the revenue is expected to surge.
Airlines are another segment that has been a beneficiary of the high demand resulting from the increase in fares during Maha Kumbh as demand has surged.
Airfares to Prayagraj from major cities have skyrocketed. While the ticket costs for Delhi to Prayagraj flights have soared to ₹20,000 or more from ₹5,000 earlier, the Mumbai to Prayagraj flights are costing between ₹20,000 to ₹56,000.
Flying non-stop from Delhi to Prayagraj with Akasa Airlines will cost one ₹24,262 while Air India is charging ₹28,739 for the same route. Flights with layovers are even more expensive.
Similarly, the price of tickets for SpiceJet’s direct flight from Mumbai to Prayagraj starts at ₹20,482.
Direct flights from Hyderabad to Prayagraj were fully booked till the last week of February, forcing travelers to go for connecting flights. The fastest route, involving a one-hour layover in Mumbai, takes five hours and is priced at ₹28,901 for January 29. A day later, on January 30, the same flight is priced at ₹36,901.
Meanwhile, an ICRA report has stated that the Indian hotel industry is poised for a 7-9 per cent revenue growth in FY2025, driven by strong domestic leisure travel demand and events like weddings and business travel.
ICRA expects occupancy to hit decadal highs, with tier-II cities and spiritual tourism contributing significantly.
While domestic tourism remains a key driver, foreign tourist arrivals have yet to rebound fully post-Covid, contingent on the global economic climate.
ICRA foresees premium hotel occupancy peaking at around 70-72 per cent in FY2024 and FY2025, with average room rates climbing to Rs.7,800-8,000) in FY2025.
Despite some outliers exceeding pre-Covid levels, the industry is expected to reach the 2008 peak by FY2025. The medium-term outlook remains positive, supported by infrastructure enhancements, air connectivity improvements, and the growth of large-scale MICE events with new convention centres opening in recent years, the report states.
(IANS)
