Recovery in leisure and corporate travel faster than first and second waves: ITC Hotel’s Anil Chadha

We are witnessing recovery trends after the initial setback as a result of Omicron. State governments have rolled back restrictions pertaining to travel. There is stronger bounce back of business. Recovery in both leisure and corporate travel is faster than what we registered post the first and second waves. For instance, WelcomhotelPahalgam, WelcomhotelMussoorie, WelcomhotelChail and Welcomhotel Shimla were sold out as soon as the Omicron wave subsidedand continue to register high occupancies now.

The Q3FY22 (Oct - Dec) period has already seen considerable recovery versus like-for-like, last year. The H1FY23 has a number of key wedding dates and easing of restrictions will help the industry deliver robust growth. Further, there is a fair amount of pent up demand in the MICE (meetings, incentives, conferences and exhibitions) segment, which is expected to make a come-back next fiscal. The second half of next fiscal is likely to see resumption of international delegations and diplomatic visits, all of which slowed down during the last two years. In the wedding segment we are witnessing a healthy demand pipeline build up already. We would like to leverage this opportunity given the ability of this segment to recover from any set back.

Responding speedily to the challenges and disruptions arising out of the pandemic, we launched a host of curated offerings that will leverage and sweat existing assets besides augmenting new revenue streams. These include the introduction of innovative staycation packages and in-home dining offerings such as ‘Gourmet Couch’ and ‘Flavours’

Domestic leisure, which has been a mainstay segment for almost two years now, has been the quickest to recover with subsiding cases of infections and increasing vaccinations. People have started travelling again, and we are witnessing a surge in demand across hotels, especially at leisure destinations.

Staycations and short-haul trips to the hills and beaches are back to pre-Omicron levels. We expect this trend to continue, and the demand is likely to grow.

As countries ease travel restrictions and open-up borders, business travel is likely to resume though at much lower levels than pre-Covid.

Wellness and leisure segments are leading the partial recovery of tourism, but the MICE segment needs to pick up for faster recovery.

Corporate travel showed recovery signs in Q3, approximately at 50 per cent of pre-pandemic levels, until December. January was a minor hiccup, but this segment with a “wait and watch” approach, always takes a little longer to recover compared to leisure. We expect it to be back on track by early-March 2022.

Business travel should recover to nearly 70 per cent of pre-Covid levels in FY23, especially with economic growth now gaining momentum. It has also started booking through publicly available retail rate-plans, given the volatility of rates the industry has witnessed over the last couple of years. Many organisations still have some sort of travel guidelines in place, and intermittent restrictions on travel continue.

Relaxation by countries who have trade and cultural links with India is likely to gain traction over the next few months. India too will open up sometime soon. So new travel bubbles will emerge. And it is expected to lead to a substantial revival in international arrivals through 2022-23.

Our portfolio of brands include ITC Hotels, Welcomhotel, Mementos, Storii, Fortune and WelcomHeritage. Our asset right strategy to drive accelerated growth will see us increase the pan-India footprint through focus on management contracts. Having consolidated our space in the luxury segment (ITC Hotels) we will now expand across other brands. Our hotels in the pipeline include ITC Narmada, Ahmedabad; ITC Ratnadipa Sri Lanka, among others. ITC Ratnadipa will be our first international foray. We recently launched another luxury brand ‘Mementos’ and hotels in Udaipur and Jaipur will be opened shortly under it. Some more are in the pipeline. The Welcomhotel brand added four hotels in 2021 - at Bhubaneswar, Guntur, Katra and Chail. ‘Storii’, the latest launch, caters to the boutique segment. We are working on multiple projects and have executed four MoUs across destinations including Bandhavgarh (Madhya Pradesh), Ranthambore (Rajasthan), Solan (Himachal Pradesh) and Goa.