Top Hotel Stocks in India for 2024: Best Stocks in the Hospitality Industry

The Indian hotel industry is an integral part of the global economy and significantly impacts the tourism and Indian hospitality sector stocks. With the rise in disposable income and travel, the demand for hotels has increased, making it a lucrative investment option. Investing in the best hotel stocks in NSE can diversify your investment portfolio. Additionally, it can be an effective way to capitalise on the growth potential of the hotel and tourism stocks in India. In this blog, we will explore the ins and outs of hotel stocks in India. Moreover, we’ll also highlight the popular hotel shares in India that you can consider buying in 2024.

List of Top 10 Hotels Share in India

Here are the top 10 listed hotel companies in India that could be excellent hotel investments for investors with different risk appetites.

Hotel Stock Name	Market Cap (Rs. in cr.)	Close Price (Rs.)	PE Ratio	5Y CAGR (%)	5Y Avg Net Profit Margin (%)	ROCE (%)
Phoenix Township Ltd	315.48	225.60	1.61	86.76	14.97	514.40
Advani Hotels and Resorts (India) Ltd	686.73	74.29	27.51	19.80	13.05	42.76
Benares Hotels Ltd	1,055.17	8,116.70	29.29	43.77	12.14	34.04
Nicco Parks & Resorts Ltd	677.66	144.80	27.37	44.23	13.04	33.01
Kamat Hotels (India) Ltd	600.57	203.72	13.39	39.47	2.88	30.16
U. P. Hotels Ltd	777.60	1,440.00	24.44	37.06	5.85	27.35
Sinclairs Hotels Ltd	525.83	103.07	25.60	28.00	25.70	21.84
EIH Associated Hotels Ltd	2,410.94	395.65	29.76	20.06	6.95	21.79
Royal Orchid Hotels Ltd	1,022.96	373.00	21.10	36.63	2.82	19.77
TAJ GVK Hotels and Resorts Ltd	1,961.30	312.80	21.16	14.89	2.75	17.35

Disclaimer: Please note that the above list is for educational purposes only, and is not recommendatory. Please do your own research or consult your financial advisor before investing.

Note: The data on the top hotel companies listed in India is from 18th September 2024. To churn out a list of the best hotel stocks in India, we have used the following parameters on the Tickertape Stock Screener.

• Sector > Consumer Discretionary (Hotels, Resorts & Cruise Lines)
• 5Y CAGR: Mid to high
• 5Y Avg Net Profit Margin: Zero to high
• Return on Capital Employed (ROCE): Sorted from highest to lowest

🚀 Pro Tip: You can use Tickertape’s Stock Screener to research and evaluate stocks with over 200+ filters and parameters.

What are Hotel Stocks in India?

Hotel stocks India are shares of companies that operate in the hospitality industry, including hotels, resorts, and other accommodation facilities. By investing in the best hotel stocks in India list, investors can participate in the growth and profitability of these companies. Also, it potentially earns returns on their hospitality shares India.

Top 10 Hotel Shares in India – Overview

Let’s have a look at the top hotel shares in India, from our list of top 10 hotel companies in India:

Phoenix Township Ltd

Phoenix Township Ltd is engaged in real estate development with a focus on residential and commercial projects. The company has a market capitalisation of Rs. 315.48 cr., and its stock is priced at Rs. 225.60. The PE ratio stands at 1.61. The 5-yr compound annual growth rate (CAGR) is 86.76%. Phoenix Township’s 5-yr average net profit margin is 14.97%, and its return on capital employed (ROCE) is an impressive 514.40%.

Advani Hotels and Resorts (India) Ltd

Advani Hotels and Resorts (India) Ltd operates luxury hotels and resorts in India. The company’s market capitalisation is Rs. 686.73 cr., with a stock price of Rs. 74.29. The PE ratio is 27.51, and its 5-yr CAGR is 19.80%. Advani Hotels has a 5-yr average net profit margin of 13.05%, and its ROCE is 42.76%.

Benares Hotels Ltd

Benares Hotels Ltd is a part of the Tata Group and manages premium hotels under the Taj Hotels brand, particularly in Varanasi. The company has a market capitalisation of Rs. 1,055.17 cr., and its stock is priced at Rs. 8,116.70. The PE ratio is 29.29, with a 5-yr CAGR of 43.77%. Benares Hotels’ 5-yr average net profit margin is 12.14%, and its ROCE stands at 34.04%.

Nicco Parks & Resorts Ltd

Nicco Parks & Resorts Ltd operates amusement parks and provides leisure and entertainment services in India. The company has a market capitalisation of Rs. 677.66 cr., with a stock price of Rs. 144.80. The PE ratio is 27.37. The 5-yr CAGR is 44.23%, while the 5-yr average net profit margin is 13.04%. The company’s ROCE is 33.01%.

Kamat Hotels (India) Ltd

Kamat Hotels (India) Ltd is a hospitality company that owns and operates hotels and resorts in India, including the five-star property – The Orchid. The company has a market capitalisation of Rs. 600.57 cr., and its stock is priced at Rs. 203.72. The PE ratio is 13.39, with a 5-yr CAGR of 39.47%. Kamat Hotels has a 5-yr average net profit margin of 2.88%, and its ROCE is 30.16%.

U. P. Hotels Ltd

U. P. Hotels Ltd is a hospitality company that manages and operates a range of luxury hotels, primarily under the “Clarks” brand. The company has a market capitalisation of Rs. 777.60 cr., and its stock is priced at Rs. 1,440.00. The PE ratio is 24.44. U. P. Hotels has a 5-yr CAGR of 37.06%, with a 5-yr average net profit margin of 5.85% and a ROCE of 27.35%.

Sinclairs Hotels Ltd

Sinclairs Hotels Ltd owns and operates a chain of hotels and resorts across India, offering services in the mid-range and premium segments. The company has a market capitalisation of Rs. 525.83 cr., with a stock price of Rs. 103.07. The PE ratio is 25.60, and the 5-yr CAGR is 28.00%. Sinclairs Hotels has a 5-yr average net profit margin of 25.70%, and its ROCE is 21.84%.

EIH Associated Hotels Ltd

EIH Associated Hotels Ltd, a part of the Oberoi Group, manages and operates luxury hotels and resorts in India. The company’s market capitalisation is Rs. 2,410.94 cr., and its stock is priced at Rs. 395.65. The PE ratio is 29.76. The 5-yr CAGR is 20.06%, and the 5-yr average net profit margin is 6.95%. The ROCE for EIH Associated Hotels is 21.79%.

Royal Orchid Hotels Ltd

Royal Orchid Hotels Ltd operates a chain of business and leisure hotels across India, primarily targeting the upper mid-range segment. The company has a market capitalisation of Rs. 1,022.96 cr., and its stock price is Rs. 373.00. The PE ratio stands at 21.10. Royal Orchid Hotels has a 5-yr CAGR of 36.63%, with a 5-yr average net profit margin of 2.82%. The company’s ROCE is 19.77%.

TAJ GVK Hotels and Resorts Ltd

TAJ GVK Hotels and Resorts Ltd is a joint venture between the GVK Group and the Indian Hotels Company (Taj Group), operating premium hotels in Hyderabad, Chandigarh, and other cities. The company’s market capitalisation is Rs. 1,961.30 cr., with a stock price of Rs. 312.80. The PE ratio is 21.16. TAJ GVK has a 5-yr CAGR of 14.89%, a 5-yr average net profit margin of 2.75%, and an ROCE of 17.35%.

How to Invest in the Best Hotel Stocks in India?

If you want to invest in the best hotel stocks in India, following these steps can help you make informed decisions:

1. Research the Hotel Industry: Start by analysing the Indian hotel industry trends, including growth drivers and challenges. Understanding the sector will help you gauge the future potential of hotel stocks.
2. Identify Hotel Companies: Identify the hotel companies that align with your investment strategy. You can use tools like the Tickertape Stock Screener to filter companies based on performance, financial metrics, and sector-specific criteria, making it easier to find the best hotel shares in India.
3. Analyse Financial Performance: Investigate the financials of shortlisted companies, including revenue growth, profitability, and past stock performance. The Tickertape platform can help you examine financial ratios and key performance indicators.
4. Open a Demat Account: To begin trading, you will need a demat account with a reputable broker. Choose a broker that provides good customer service and an easy-to-use platform.
5. Buy Hotel Shares: Place orders for the hotel stocks you’ve identified through your brokerage platform. Ensure you buy shares based on thorough analysis.
6. Monitor Your Investment: Keep an eye on hotel stock prices and company news. Regularly track your portfolio and assess how well the stocks are performing.
7. Review and Adjust Your Portfolio: Periodically review your portfolio, considering factors like market trends and company performance. Adjust your holdings as needed to align with your financial goals.

Alternatively, you can invest in hotel stocks through smallcase.

Simplify Your Investment in Hotel Stocks with smallcases

House of Tata

The House of Tata is a well-known conglomerate in India that operates in a variety of industries, from automotive to hospitality. IHCL, which is an investor favourite because it is a Tata product, is also included in the House of Tata smallcase.

This smallcase is a curated portfolio of stocks that represent the company’s various business interests, giving investors an opportunity to invest in a diverse range of industries through a single investment. Hence, if you want to invest to diversify your portfolio along with investing in hotel stocks, you can check out this smallcase.

House of Tata smallcase by Windmill Capital

Happy Hours: Cheers to Good Times

Happy Hour smallcase is a curated basket of stocks that seeks to benefit from the growth potential of India’s travel, leisure, and entertainment industry. It includes the stocks of hotels, restaurants, travel, and beverage companies.

Hence, if you want to capitalise on the growth potential of India’s travel, leisure, and entertainment industry, you may check out this smallcase.

Happy Hours: Cheers to Good Times smallcase by Ethical Advisers

Disclosures for Happy Hours: Cheers to Good Times smallcase.

Implications of the Union Budget 2024 on the Tourism Industry

Finance Minister Nirmala Sitharaman, in her Budget 2024 speech on Tuesday, announced initiatives to boost tourism in India. Highlighting the historical and cultural importance of tourism, Sitharaman detailed projects to make India a top global tourist destination. Some notable changes that may impact the tourism and hospitality sectors include:

1. The tourism sector received a 3.3% increase in capital expenditure, rising to Rs. 2,479.62 cr. for the financial year 2024-25 from Rs. 2,400 cr. in the 2023-24 Union Budget. However, the revised budget for tourism stood at Rs. 1,692.10 cr.
2. The 2024-25 Budget allocates Rs. 2,080 cr. for tourism infrastructure. This is an increase from the revised Rs. 1,294 cr. allocated in 2023-24. 
3. India’s budget for international marketing under ‘Incredible India’ has increased to Rs. 33 cr. from the previously proposed Rs. 3 cr. This remains only a sixth of the Rs. 177 cr. allocated for domestic tourism marketing. 
4. Of the Rs. 2,478 cr. allocated, Rs. 2,080 cr. is designated for infrastructure development. This includes Rs. 1,750 cr. for developing themed tourist circuits under the Swadesh Darshan scheme and Rs. 240 cr. for the PRASAD scheme, both launched in 2014-15 for sustainable and responsible tourism development.
5. Sitharaman stressed the government’s focus on improving connectivity to enhance tourism. As part of this plan, an industrial node will be established in Gaya along the Amritsar-Kolkata industrial corridor.
6. The budget allocates Rs. 26,000 cr. for key infrastructure projects in Bihar. According to Sitharaman, these projects are crucial for stimulating growth in Eastern India.

Types of Top Hotel Stocks in India

The best hotel and tourism stocks in India can be broadly categorised into three types based on the level of service and amenities offered to customers. These categories are:

Luxury Hotel Stocks

The luxury hotel share list is usually associated with high-end services and amenities, such as fine dining, spa services, and personalised attention to guests. These Indian hotel stocks are often considered more volatile due to their dependency on discretionary spending and luxury travel trends. Some of the luxury NSE hotel stocks India include Marriott’s Ritz-Carlton and Four Seasons Hotels and Resorts.

Mid-Range Hotel Stocks

Mid-range hotel stocks India offer a balance between luxury and affordability, with basic amenities such as Wi-Fi, breakfast, and fitness centres. This hotel stock list can be considered less volatile than luxury hotel stocks. It has a wider customer base, including both leisure and business travellers. Some of the mid-range hotel stocks India are Hilton Garden Inn and Courtyard by Marriott.

Budget Hotel Stocks

Budget hotel shares in India offer basic services at an affordable price point and are often located in tourist and business districts. These hotel stocks can be considered to be the least volatile and offer stable cash flows. This may happen due to the customer base, which includes budget-conscious travellers and long-term stay guests. Examples of budget hotel stocks India include Motel 6 and Red Roof Inn.

Features of Hotel Stocks Listed in India

Before looking out for the best hospitality shares to buy in India, let’s have a look at  its features:

• Diverse Market: India’s hospitality industry caters to various segments, from budget hotels to luxury resorts, offering investment opportunities across different price points and risk profiles.
• More Financial Opportunities: Many hotel and tourism stocks in India offer attractive dividend yields, providing a steady income stream for investors.
• Co-working Spaces: Some hotel companies are exploring new business models, such as co-working spaces and extended stay options, to cater to changing consumer preferences and expand their revenue base.
• Mergers and Acquisitions: Mergers and acquisitions are common in the Indian hotel industry, creating opportunities for investors to capitalise on consolidation and growth strategies.

How to Choose the Best Hotel/Restaurant Sector Stocks in India?

When you want to choose the best hotel or restaurant sector stocks in India, it’s important to consider multiple factors to ensure you make an informed decision. Start by researching the financial stability of the companies in this sector. You can analyse key financial metrics, including revenue growth, profitability, and debt levels, to gauge the company’s overall financial health.

Additionally, evaluate the company’s competitive position in the hospitality industry. You might want to look at hotels or restaurants with strong brand recognition, unique offerings, and a loyal customer base, as these factors can contribute to long-term growth. Keeping up with industry trends, such as shifts in consumer preferences, tourism patterns, and regulatory changes, can also provide valuable insights into how these factors may influence the performance of hospitality sector stocks in India.

By conducting thorough research and analysis, you can better identify promising hospitality stocks in India, including those from top hotel companies or well-known restaurant chains with potential for growth in the Indian market.

Hotel Industry in India

The hotel industry in India plays a pivotal role in the country’s economic growth, which is driven by tourism and hospitality. Known for its diverse accommodations, ranging from luxury hotels to budget inns, India has become a global travel destination. As per India Brand Equity Foundations (IBEF), the industry is expected to grow at a Compound Annual Growth Rate (CAGR) of 4.73%, reaching approximately USD 31.01 billion by 2029.

The Resilience and Recovery Post-Pandemic

The pandemic severely impacted the Indian hotel industry, with hotel occupancy rates dropping to 33–36% during 2020-21. However, the sector has rebounded strongly in 2022-2023, with average daily rates (ADR) and revenue per available room (RevPAR) surpassing pre-pandemic levels. The surge in domestic leisure trips and business travel, along with the revival of events like the G20 Summit and the ICC Men’s Cricket World Cup, has boosted occupancy rates and room prices, especially in urban hubs like Delhi, Mumbai, and Bangalore.

Key Drivers of Growth

Several factors contribute to the growth of the hotel industry in India. Key among them are:

• Business Travel and Events: India is a hub for business meetings and events, which generates a steady demand for premium hotel accommodations. The resurgence of corporate events and MICE (Meetings, Incentives, Conferences, and Exhibitions) post-pandemic has accelerated the industry’s recovery.
• Religious and Cultural Tourism: India is a popular destination for religious tourism, with millions of domestic and foreign tourists visiting sacred sites each year. Government investments in infrastructure, such as the Swadesh Darshan and PRASAD schemes, have further supported this segment.
• The Wedding Industry: Valued in trillions of rupees, India’s wedding industry has created a significant demand for luxury hotels. Weddings have been a consistent revenue generator for the hotel sector, especially in cities known for destination weddings.
• Foreign Direct Investment (FDI): The hospitality sector has attracted considerable FDI, with USD 17.1 billion invested since 2000. This influx of capital has driven the expansion of international hotel chains such as Marriott, IHG, and Hyatt in the Indian market.

Potential for Future Growth

The future of the Indian hotel industry looks promising, with a projected continued rise in domestic and international tourism. Increasing disposable incomes, improved air connectivity, and infrastructure development in tier-II and tier-III cities offer significant opportunities for growth. The industry is expected to benefit from the growing popularity of wellness tourism, eco-friendly accommodations, and the rise of branded budget hotels catering to a larger middle-class population.

Moreover, technological advancements, such as online booking platforms and smart hotel solutions, are becoming integral to enhancing customer experiences and operational efficiencies in the industry.

India’s hotel industry has demonstrated resilience, overcoming challenges posed by the pandemic and capitalising on opportunities in the tourism and hospitality sectors. With continued growth expected through business travel, domestic tourism, and government-supported initiatives, the Indian hotel industry is poised to play a major role in the nation’s economic future.

Factors Affecting the Indian Hotels Stock Price

Hotel sector stocks in India can be a promising investment opportunity for those seeking to build a diversified portfolio. However, before investing in any hotel stock, it’s important to consider the following factors:

• Economic Trends: Economic trends such as the GDP growth rate, inflation, and interest rates can significantly impact the hotel share price. Therefore, it’s essential to keep an eye on economic indicators to gauge the potential impact on the hotel industry.
• Global and Local Market Trends: It’s important to consider global and local share market trends while investing in hotel stocks to buy. The demand for hotels’ occupancy rates is impacted by factors such as tourism, business travel, and events in the area. Therefore, it’s essential to evaluate market trends to gauge the potential performance of hotel stocks India.
• Company Performance and Financials: The financial performance of hotel stocks India is a crucial factor to consider before investing. It’s important to evaluate the revenue, profit margins, debt, and liquidity of the best hotel company in India.
• Government Regulations: Government regulations such as zoning laws, taxes, and labour regulations can impact the hotel share price. Therefore, it’s important to evaluate the regulatory environment and its potential impact on the hotel industry.

Benefits of Investing in the Hospitality Industry in India

Investing in hotel industry shares can provide several benefits to investors. Here are some of the key advantages of investing in hotel stocks:

• Diversification: Hotel stocks can offer diversification to an investor’s portfolio by providing exposure to a different sector. By investing in hotel stocks India, investors can diversify their investments across various industries. Thus, this can help in reducing overall portfolio risk.
• Income Generation: Many hotel stocks India offer a dividend to their shareholders. This can provide a steady source of income to investors. The dividend payments can be reinvested to buy more shares, which can help in generating long-term wealth.
• Potential for Long-term Growth: The Indian hospitality industry has significant growth potential, especially in emerging markets. As the global tourism industry continues to expand, there is a growing demand for hotels and accommodation. This trend can translate into long-term growth opportunities for hotel stocks.
• Global Exposure: Many hotel stocks India have a global presence, which can provide investors with exposure to the international markets. This can help diversify one’s investments across different geographies and currencies. Thus, this can help in reducing risk and maximising returns.

However, investors must do their own research and/or consult their financial advisor before investing.

Risks Associated with Hotel Stocks

Hotel industry shares in India, like any other stocks, come with certain risks that you must consider before investing in the top hotel stocks list. Some of the key risks associated with hotel stocks India are as follows:

• Economic Downturns: The hotel shares in NSE industry is highly sensitive to economic cycles. During an economic downturn, people tend to cut back on discretionary spending, including travel and vacations. This can lead to a decrease in demand for hotel rooms and a corresponding drop in revenue and profitability for hotel companies.
• Natural Disasters and Pandemics: Natural disasters such as hurricanes, floods, earthquakes, and wildfires can damage hotel properties and disrupt travel plans. Similarly, pandemics like COVID-19 can severely impact the hotel industry shares in NSE.
• Competition: The hotel industry is highly competitive, with numerous players vying for market share. This competition can lead to price wars and thin profit margins, which can impact the financial performance of hotel companies.
• Regulatory Risks: Hotel companies are subject to various regulations related to zoning, building codes, environmental laws, and labour laws. Non-compliance with these regulations can result in fines, legal liabilities, and reputational damage.

Who Should Invest in Hotel Shares in India?

If you’re considering investing in Indian hotel shares, it’s important to know the type of investor you are and whether this sector suits your goals:

• Risk-Averse Investors: If you tend to avoid high-risk investments, hotel stocks may not align well with your strategy. The hospitality industry is sensitive to economic downturns, where reduced travel can lead to lower profits. Additionally, natural disasters may affect hotel properties and earnings. You should consider these risks before you invest in hotels.
• Long-Term Growth Investors: If you’re seeking long-term growth, you might find opportunities with the top hotel companies in India that have a strong brand presence and stable financials. These companies are better positioned to recover from temporary market disruptions and offer potential for growth as travel rebounds.
• Sector-Specific Investors: If you’re specifically focused on the hospitality stocks in India, you should consider the competitive nature of this sector. Price wars between hotel chains can reduce margins, and regulatory hurdles around zoning, labour, and environmental compliance may impact financial stability.
• Experienced Investors: If you’re an experienced investor familiar with market cycles, you may be comfortable navigating the ups and downs of the hotel industry. You could explore the best hospitality stocks in India, keeping in mind the potential for high returns when the market conditions are favourable.

To Wrap It Up…

Investing in the top hotel shares in India can be a smart move to diversify your portfolio and capitalize on the growth potential of the Indian hospitality industry. However, it is important to consider various factors. Such as economic trends, company performance, and government regulations before making any investment decisions. 

With the right approach, investing in the best hotel sector stocks can offer potential long-term growth. Hence, the best hotel stocks in India can be a great addition to your investment strategy. Moreover, instead of investing in individual hotel stocks India, try smallcases that consist of hotel stocks. Why? Because it will help you diversify your portfolio without wasting a hell lot of time evaluating individual stocks.

FAQs

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