Top 5 Hotel Stocks in India

8 Jun 2022  Read 1953 Views

What comes to your mind when you think about a luxurious hotel? The lavish rooms, state-of-the-art facilities, delicacies to savour, and…the huge hotel bill, right? Well, here’s a different perspective on a hotel. What if you invest in a hotel stock and earn enough profits to schedule a luxury vacation instead? Interesting, isn’t it? The prices of hotel stocks in India were on the slide due to the COVID-19 pandemic, but the industry is reviving quickly!

As per the experts, the Indian hospitality industry is set to become the fastest-growing hotel industry globally. With the growth prospects being projected to be relatively stable for the coming decade, it is forecasted that the industry may well be worth a whopping USD 300 billion by 2025 itself. As the tourism industry grows in India, the hotel stocks are expected to outperform themselves as well. 

This blog lists the best hotel stocks to buy with a positive growth outlook. Read on to know more!

Why invest in hotel stocks in India?

You wouldn’t believe this, but the pandemic has almost left an enormous population starving for travel! Here are some numbers & facts about the hospitality industry outlook. 

  • As per a Forbes article, 72% of the American people want to undertake long-distance vacations. 

  • More than 83% want to undertake short to long-distance travel in India.

  • With the Indian Government’s emphasis on building a solid travel ecosystem, India is set to become the fastest-growing travel destination in the world. 

  • Employers are also providing options to their employees for a staycation, where the employee can work from a remote destination while enjoying a fresh locale. 

  • Being home to some of the most well-known UNESCO World Heritage sites and a diverse cultural landscape, India is well-placed in this changing scenario. 

  • The variety of authentic Indian cuisines is a tourist attraction in itself! 

  • With the second-highest population using the internet, connectivity is not a problem while travelling in India. 

All these make India the favourite destination for local and international tourists. As per ICRA, the hotel occupancy in India has grown over 50% in FY 22 compared to FY 21. This has given a massive boost to the hospitality industry in India. Talking about the stock returns, six major hotel stocks in India have provided a Return on Investment (ROI) between 75-180% in the last one year. Now, these are some promising numbers! 

Market Risk

While the investment outlook looks positive, can profits be guaranteed? Is the grass always green? Are stock market profits guaranteed? Definitely not!

But, this doesn’t mean that investments don’t grow. Any investment carries risk. But, if the industry performs well, your investments can grow even if the stock markets fall. As an investor, you can get your inspiration to bear the risk from our beloved Uday Bhai. 

Best Hotel Stocks in India for your Consideration

Now that you have understood the industry outlook and the prospects of the Indian Hospitality industry, here is a list of some of the best hotel stocks to buy in India that are likely to provide high returns!

  • The Indian Hotels Company Limited

IHCL is one of the biggest hotel chains in South Asia, owning brands like Taj, Vivanta, etc. Owned and operated by the Tata Group for more than 115 years, it enjoys the biggest Market Capitalization in the Indian Hospitality industry. Awarded the titles of World’s Strongest Brand in 2021 and India’s Strongest Brand in 2022, IHCL owns India's finest chain of luxury hotels. Here’s the price chart of IHCL for the last one year.

IHCL has provided almost 81% returns to the shareholders during the past year. It is well set to record high growth in the coming years if given the right growth opportunities. Thus, it is one of India's best hotel stocks to buy in India.

  • Chalet Hotels Limited

Owned by the K Raheja Corp Group, Chalet Hotels Limited operates seven luxury hotel facilities in the metropolitan cities of Mumbai, Hyderabad, Bengaluru, and Pune. Some iconic brands owned by Chalet Hotels Limited include Marriott and Four Points in Mumbai and Bengaluru. Here’s the price chart of CHL for the last one year:

The price of Chalet Hotels stock has risen by 72% during the last year. This means that it is one of the major beneficiaries of the upcoming tourism boom in India. Having a strong stock like CHL in your portfolio can considerably increase your returns.

  • The Byke Hospitality Limited

Owning a total of 21 luxury hotel resorts across 16 cities in India, The Byke Hospitality Limited truly envisions the essence of traditional India. Keeping the cultural legacy of India in the foundation, TBHL practices the mantra of “Atithi Devo Bhava”. TBHL offers pure vegetarian cuisine at its establishments. With more and more tourists wanting to experience nature, TBHL resorts provide the best option for staying in a number of Indian cities and towns.

Given the strategic benefits of TBHL, the stock price is yet to reach its potential peak. The above chart shows only 20% returns during the last one year, leaving room for a big investment opportunity compared to its peers. TBHL is one of the best hotel stocks in India that you should consider buying!

  • EIH Limited

If you know about the Grand Taj Hotel in Mumbai, you also know about the Oberoi Trident nearby! Owned by the Oberoi Group, EIH Limited owns one of India's largest chains of luxury hotels. Having over 33 hotels in its luxury hotels portfolio across seven countries, the revenue of EIH Limited spans across borders. Here is the chart of the past year's performance of EIH Limited share price.

With lower growth in share price compared to its peers in the luxury segment, EIH Limited can just be the stock that changes your fortune in the stock markets. Considering the growth prospects, EIHL is one of the best hotel stocks in India.

  • Lemon Tree Hotels Limited

With more than 87 hotels across 54 destinations in India, Lemon Tree Hotels Limited owns hotels that range from Super Luxury to Economy. This means that the customer base of Lemon Tree Hotels is not limited to luxury customers only, and they cater to a wide range of customers belonging to all classes of society. 

The above chart shows that Lemon Tree Share Price has increased by almost 54% in the last year. Given the operational scale and customer range of Lemon Tree Hotels, it is a must-buy for you!

The Conclusion

You must have already dreamt about earning loads of money within just a few days. But remember, no scheme can provide “25 din mein paisa double” kind of returns unless, of course, it is Akshay Kumar guaranteeing the success of the movie to his film producer! 

The hospitality industry in India is all set for a big boom! As a result, the chances of hotel stock prices skyrocketing are pretty high. While you are busy planning your next vacation, buy these best hotel stocks in India and start putting money into your luxury vacation fund! 

You can make more intelligent and well-informed investments with Finology ONE. It helps you grow your knowledge about investments and also provides stock recommendations from time to time. Start your investment journey with Finology ONE Now! 

Please let us know in the comments whether this article was helpful, and do share this information with your friends & family because sharing is caring!

 

Disclaimer: The stocks shown in this article are for the purpose of giving examples. These are not recommendations.

About the Author: Deb P Samaddar | 233 Post(s)

Deb is a keen learner and eager to learn about the finance world. With an increased proclivity towards tech and language, he aims to capitalise on his interests as a content writer at Finology.

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