However, the recent investor frenzy on the bourses appears to have brought some much-needed Christmas cheer for the beleagured lot of hotel stocks. Take for example - East India Hotels, the scrip has seen a sharp improvement from the Rs 177 levels to Rs 218, in the matter of five trading days.

A similar sentiment was echoed by the Indian Hotels scrip which has seen an appreciation of 24 per cent to Rs 347, while the ITC Hotel scrip has also witnessed a 36 per cent jump in valuations to Rs 122 over a similar period of five trading days. Most surprising is perhaps the Hotel Leela Ventures stocks, which has been privy to a solid 40 per cent appreciation from Rs 27 to Rs 38.25. Does this signal a resurgence in the hotel industry?

Unfortunately, the answer to this lies in the negative, with analysts attributing the sudden interest to improved third quarter performances by this industry, given the millennium melee. However, things might show some improvement in the interim, given the stable economic environment which now appears conducive for business traveller inflows. But this aspect aside, there is the serious threat of over-capacities looming large, given the expansions and new projects coming up in the sector.

Additionally, the Government also has done precious little in terms of marketing India as an international tourist destination. There is also a dearth of adequate infrastructure which is of paramount importance for attracting tourists. India's tourism potential can be gauged by the fact that Hong Kong attracts five million tourists a year, compared to a mere two million in India.