India’s significant domestic potential – plus the prospect of creating brand-loyal international travellers – has major flags scrambling to expand in the country.
UK brand Claridge’s is the latest name in hospitality targeting expansion in India, following last week’s announcement of a deal with the Indian Hotels Company (IHCL), which will bring as many as twenty Claridge’s hotels to the country.
While Claridge’s already has a flagship hotel in New Delhi, the collaboration sees IHCL take over management of this property, before rolling out two further properties, with a view to reaching around 20 by 2030.
Says Puneet Chhatwal, IHCL CEO: “With India’s growing economic prominence, the income pyramid is witnessing a structural shift and the demand for luxury product and services is at an all-time high led by significant expansion of households in the high-net worth bracket.” He adds: “This presents a market opportunity to extend hospitality offerings in the luxury segment as consumers are seeking differentiated experiences.”
Midmarket potential
Not all brands are clustered in the same space, however, with Radisson, for example, exploring the Indian market through a range of flags from the upscale Radisson Collection and Radisson Blu through to the budget Park Inn and Park Plaza. The group recently crossed the 200 hotel threshold in the country, signing over 51 hotels in key leisure and metro markets in the last 14 months alone.
The last five signings have comprised Radisson Blu Resort & Spa, Pawna Lake; Radisson Blu Hotel, Lucknow CBD; Radisson Hotel Rajkot and two conversions - St. Marks Hotel, a member of Radisson Individuals in Bangalore CBD and Temple Tree Hotel Shirdi, a member of Radisson Individuals in Shirdi.
Speaking recently at the IHIF EMEA in Berlin, Elie Younes, global chief development officer, Radisson Hotel Group, described the Indian market as “on steroids” and a “massive market”. He added: “It is probably the market that has the best fundamentals for hotel development from a policy perspective; comprising hardworking people, an incredible talent pool and strong economic outlook. Everything in India is about growth.” He added that the volumes of Indian tourists visiting Europe was also an encouraging sign and something to build on.
Brand loyalty
Several hotel groups, indeed, see India’s potential not only as an opportunity to dominate its domestic market, but also to boost brand familiarity for Indians that then travel overseas.
Says Camil Yazbeck, global chief development officer - premium, midscale & economy, Accor: “The more hotels we have in India, the more loyal customers we have that will utilise the hotels we have in Europe and everywhere else. This is what we did in China.” Today, Chinese guests account for roughly 15 percent of Accor’s hotel guests in Asia, a data point with replicable potential in India. Faster growth is also being achieved via key partnerships; recently Accor inked a deal with India’s InterGlobe to add hundreds of Accor hotels to the Indian market by 2030. The French group currently operates around 70 hotels in India, with 40 in the pipeline, from budget to luxury brands.
Under the agreement, Accor and InterGlobe will take a significant stake in Treebo, one of India’s leading branded budget hotel platforms, which manages some 800 hotels across 120 cities. In joint statement, the firms say that “Treebo will take the lead to develop the Ibis and Mercure brands in India through a master license agreement”, to ultimately “create India’s third-largest hospitality player, with over 30,000 rooms”.
Conversion for growth
Converting standing properties often provides a quick fillip for growth, and a number of brands are getting faster at growing in India via such a strategy. This month, IHG Hotels & Resorts’ newest midscale conversion brand, Garrner, made its debut in the country, rolling out properties in Etawah in Uttar Pradesh and Kathua in Jammu & Kashmir. Sudeep Jain, managing director, South West Asia, IHG Hotels & Resorts calls Garner “a significant addition to our portfolio in the country, offering high-quality, reliable stays at an affordable price, designed to meet the evolving needs of modern travellers and drive strong returns for owners”. He adds: “The brand has tremendous growth potential in India, particularly through the franchising model.” Garner aside, IHIG currently has 47 hotels operating across five brands in India, including Six Senses, InterContinental Hotels and Resorts, Crowne Plaza, voco Hotels, Holiday Inn Resort and Holiday Inn Express, plus a strong pipeline of 60 hotels due to open in the next three to five years.
Meanwhile the Ascott Limited, the lodging business of Singapore’s CapitaLand Investment (CLI), plans to double its portfolio in India to 12,000 units by 2028, up from about 5,500 units at the end of 2024. Ascott CEO Kevin Goh describes India as “an important inbound and outbound market for Ascott with strong growth potential” thanks to its “rapidly growing middle class, increasing disposable incomes and improving infrastructure”. He adds: “Despite promising prospects, the supply of branded hotel rooms in India remains limited, creating a significant demand-supply gap.”
Ascott’s Lee Ngor Houai, CEO EMEA, South Asia and China, Ascott, adds: “Moving forward, our growth strategy in India will be driven by a dual focus on geographic and brand expansion. Currently, 85 percent of Ascott’s operating portfolio in India are concentrated in Tier-1 cities such as Bangalore, Chennai and Hyderabad. We will continue to strengthen our presence in these high-performing Tier-1 cities, while also expanding our focus on the fast-growing Tier-2 and Tier-3 cities. This strategy is driven by growing interest in India’s lesser-travelled destinations and the significant under-penetration of branded hotels in these cities.”
Today, brands such as Ascott, Citadines, Oakwood and Somerset are already active in the country, but the firm sees an opportunity to add upscale flags such as The Unlimited Collection and The Crest Collection. Recent signings include the 150-key Oakwood Sensation Dona Paula Goa, opening in 2028; the 100 key Oakwood Thanjavur, opening the same year; and Oakwood Ekana Sporz City Lucknow, set to launch in 2029 with 350 units within the Ekana Sportz City, which features world-class sports venues like the Ekana Cricket Stadium, along with residential, commercial, hospitality and medical facilities.