What Happened
JM Financial has issued a positive report on the Indian hotel sector, forecasting a 12-13% year-on-year growth in Revenue Per Available Room (RevPAR) for Q2 FY27. This growth is expected to be driven by robust demand from leisure, corporate, and event segments. The brokerage specifically favors Leela, Lemon Tree, and ITC Hotels.
Why It Matters (for you)
This analyst upgrade and positive sector outlook come just before the crucial Diwali and holiday season, which typically sees a surge in travel and hospitality demand. Strong RevPAR growth directly translates to improved profitability for hotel chains, making this a significant catalyst for stock performance in the near to medium term.
Impact on Indian Markets
Lemon Tree Hotels (LEMONTREE) and ITC Limited (ITC), which operates ITC Hotels, are directly highlighted as preferred picks, suggesting potential for positive price action. Leela Hotels, while mentioned, is not publicly listed. The broader hospitality sector could also see a positive sentiment spillover, benefiting other players like Indian Hotels Company (INDHOTEL) and EIH Limited (EIHOTEL).
What Traders Should Watch Next
Traders should monitor the actual Q2 FY27 earnings reports from these hotel companies for confirmation of RevPAR growth. Any positive commentary on forward bookings for the holiday season would further reinforce the bullish view. Keep an eye on tourist arrival data and corporate event calendars for sustained demand indicators.
Key Evidence
- JM Financial expects hotel-sector RevPAR to grow 12–13% year-on-year in Q2 FY27.
- Growth supported by leisure, corporate, and event demand.
- JM Financial favors Leela, Lemon Tree, and ITC Hotels.
- Leela forecast to lead same-store growth at 15–16%.
- Risk flag: Unexpected slowdown in leisure travel