While the ICC Cricket World Cup 2023 tournament ended with India losing to now-sixth time winners Australia, by six wickets on November 19, the hotel industry still had much to celebrate. Hotels across cities hosting the World Cup matches recorded occupancy upwards of 90 per cent. Also, average room rates (ARRs) shot up significantly, being in the range of 120-150 per cent depending on whether it was in the earlier part or later part of the tournament, to even 500 per cent for some hotels, said experts and industry leaders. “The city-wide occupancies were upwards of 90 per cent on days when the matches were played in the respective cities, with ARRs being in the range of 120-150 per cent, depending on whether it was in the earlier part or later part of the tournament,” said Vinutaa S, Vice President & Sector Head – Corporate Ratings, ICRA Limited.
Meanwhile, Vikramjit Singh, President, Lemon Tree Hotels, said, “There was a huge increase in ARR across cities, including a 100 per cent increase at Mcleodganj, +250 per cent increase in Ahmedabad on both match days and nearly 500 per cent increase in Lucknow. Kolkata witnessed a smaller increase of 15 per cent as compared to the rest of the month. Similarly, there was an increase in occupancy ranging from 20-40 per cent across these cities, and our hotels in Mcleodganj, Ahmedabad, Lucknow and Kolkata were nearly sold out on match dates.”
These surges were noticed especially on the days when India matches were played with destinations where other countries were playing was relatively lukewarm in terms of responses, said Shiv Kumar Mehan, Chief Executive Officer, BRIJ Hotels. “ARR in cities where India played matches went to 2.5 times the normal rates on account of demand driven rates. Occupancy was at 90 per cent if not 100 per cent in those cities for the organised hotel sector,” he said.
Experts said that the cities to benefit most from the tournament were Ahmedabad, McLeodganj, Lucknow, Mumbai, Kolkata. “During the ICC World Cup 2023 tournament, the enthusiasm for cricket reached new heights, reflecting in a substantial surge in bookings across our strategically located ibis properties. Cities such as Hyderabad, Chennai, Bengaluru, Mumbai, Delhi, Pune, and Kolkata, where the matches unfolded, experienced heightened demand for our accommodations,” said Vinay Gupta, Director of Operations, ibis & ibis Styles India.
Advanced booking vs walk-ins
The World Cup fever had most fans planning their match-related travels much in advance with air ticket prices and hotel tariffs skyrocketing around the match dates. “Cities like Kolkata, Ahmedabad, Bengaluru and others hosting India matches, saw a huge surge for the dates in question with inventory being sold out well in advance,” said Shiv Kumar Mehan.
Meanwhile, Lemon Tree Hotels’ Vikramjit Singh said, “During the group matches, there were advance bookings in Lucknow, Kolkata and Ahmedabad. However, there was last minute demand, especially for the final at Ahmedabad, after India qualified to play in the finals. Lemon Tree Hotel, McLeodganj, which opened on 21st Sep 2023, was sold out on 22nd Oct 2023 for the India-NZ match.”
For ibis & ibis Styles India, it was a mix of advanced bookings and walk-ins. “We observed a mix of both advanced bookings and walk-ins during the ICC World Cup. While the anticipation led to a higher number of advanced bookings, the spontaneous nature of cricket enthusiasts also resulted in a notable percentage of walk-ins, adding to the vibrant atmosphere at our properties,” said Vinay Gupta.
ibis also introduced the World Cup offer wherein it offered its entire menu for 50 per cent off during the power plays and also introduced a spin-wheel game at the Spice it restaurants. “The response was overwhelmingly positive, with guests enjoying the fusion of culinary delights inspired by the spirit of the game. This initiative added an extra layer of excitement to their stay, contributing to the overall success of our offerings during the ICC World Cup,” added Vinay Gupta.
WC effect on the next quarter
The hotel industry will continue to have an aftereffect of the tournament in the coming quarter and even in its FY24 earnings. “The ICC Men’s World Cup that just concluded has been a shot in the arm for the hotel industry in Q3 FY2024. For the industry, for Q3 FY2024, we expect occupancy to be upwards of 75 per cent, while ARRs would be at Rs 6,500- Rs 6,600. The industry revenues are expected to grow by 12-15 per cent YoY in Q3 FY2024, on an already high base of Q3 FY2023, aided by both the World Cup and festive season travel,” said ICRA’s Vinutaa S, while adding that there could be some moderation in margins, albeit higher than pre-Covid levels, with increase in employee expenses and some hotels undergoing upgradations/renovations.
For FY24, ICRA expects the industry to report double-digit revenue growth. “Sustenance of domestic leisure travel, demand from MICE and business travel, along with increase in FTAs would support revenues. The industry has also benefited from the G20 Summit and ICC Men’s World Cup 2023. Over the medium term, healthy demand amid relatively lower supply and property upgrades would lead to higher ARRs. Larger players would also benefit from commissions from asset-light expansion and other diversified revenue sources,” said Vinutaa S.