Last week saw the exciting announcement of three international hotel chains debuting their luxury brands in India. Hilton’s Waldorf Astoria and Minor Hotels’ Anantara brand are all set to make their first appearance in India in the picturesque city of Jaipur, while Radisson has picked Hyderabad for the launch of its Radisson Collection brand. Marriott International CEO, Anthony Capuano, expressed his enthusiasm for the luxury segment in India, stating that the hotel group has a lot of room for growth. Not to be left behind, Fairmont Hotels & Resorts also announced the opening of a new property in Agra in 2025, marking their fourth new development in India.
The Radisson Collection is expected to open its doors in India by the second quarter of 2026, while Anantara Jaipur Hotel is set to launch in the fourth quarter of 2023 and Waldorf Astoria in 2027. These luxury hotels are eyeing the lucrative weddings and events sector in India, which has been growing rapidly in recent years. With the promise of world-class amenities and exceptional hospitality, these hotels are poised to make a significant impact in the Indian hospitality industry.
“According to the market research, India Luxury Hotel Market was worth US$ 23.69 Bn. in 2020 and total revenue is expected to grow at a rate of 8.92 percent CAGR from 2021 to 2027, reaching almost US$ 46.93 Bn. in 2027. “
The growth in the luxury hotel market profits can be attributed to the increasing tourism and travel industry, as well as the rise in disposable income and standard of living of individuals who now have a greater preference for leisure tourism. This is reflected in the Indian Luxury Hotel Market report, which provides a comprehensive assessment of the market.
The luxury hotel sector currently represents about 11 percent of India’s total quality hotel supply and has gained developer attention in recent years due to its tremendous potential, despite limited supply. Traditionally, the luxury segment in India was dominated by local hotel brands such as IHCL, Oberoi, and ITC. However, with the entry of global hotel chains such as Marriott, Accor, Hilton, and Hyatt into the luxury and ultra-luxury hotel categories in India, the sector has become more competitive.
As a result, luxury properties accounted for 11 percent of total brand signings by key players in 2020, up from 9 percent in 2018. This trend is expected to continue as the market grows, offering a unique opportunity for luxury hotel chains to tap into the Indian market and provide world-class amenities to the discerning Indian traveler.
The luxury hotel industry in India is a thriving sector, and its growth is being fueled by several factors. The influx of international tourists and domestic travelers attending sporting events, trade fairs, and exhibitions is expected to contribute to the growth of the industry. The travel and tourism industry, along with changes in the standard of living, has led to a steady increase in luxury hotel market trends.
Several key factors are driving the growth of the Indian hotel market, including the rising purchasing power parity of domestic travelers, a developing airline industry, increasing foreign tourist arrivals, and relaxed visa restrictions. Furthermore, the recent rate cut by the GST council, reducing the tax rate from 28% to 18% for luxury hotels, is expected to further drive growth in the Indian luxury hotel market over the forecast period.
India Luxury Hotel Market Trends
Indian travelers are spending more extravagantly than ever before, and their expenditure is not confined to international travel alone. Domestic luxury and branded hotels are witnessing a rise in revenue from domestic leisure travelers. These travelers are not only opting for high-end hotels for vacations but are also spending considerable sums within the hotels during their stay. As a result, domestic leisure travel has become the fastest-growing category for luxury hotel chains.
While the overall leisure segment, which includes both domestic and international travel, is growing at a rate of 10-11 percent, the rate of growth for domestic leisure travel is even higher. This trend highlights the increasing preference for luxury staycations among Indian travelers, who are willing to spend more to enjoy top-notch amenities and services within the country. The hospitality industry in India is well-positioned to capitalize on this trend, offering world-class facilities and experiences that cater to the discerning tastes of Indian travelers.
The Heritage Theme is expected to dominate the market share in the coming years. India already has several Heritage theme hotels, such as The Leela Palace in Rajasthan, which offer guests a luxurious experience surrounded by the natural beauty of the region and the warmth of Indian hospitality. These hotels have a rich historical background and showcase their region’s culture through traditional cuisine and regional art. In contrast, modern luxury hotels offer high-tech infrastructure and a comfortable living experience.