India’s hotel sector is looking forward to a confident future, underpinned by a strong and growing domestic traveller demand.
While the country continues to grow its tourism offer, in common with many other nations, it is the strength of demand from Indian travellers that is providing confidence. Manufacturing growth, improved economic conditions and consumer spending power are all heading in a positive direction. These factors align with a government that is spending substantial sums to improve infrastructure, with new airports and better roads making travel simpler.
Domestic Demand is Booming
Mandeep Lamba, South Asia president at HVS, says domestic demand is growing across a very broad base: “Short breaks, drive-to leisure, pilgrimages, weddings, and social celebrations continued to anchor demand across regions and seasons.”
And that demand is spreading out, not just favouring major global destinations: “Tier-II and Tier-III cities further consolidated their place on the national travel map, supported by decentralization of economic activity and improving regional connectivity. These markets are no longer peripheral to India’s travel story; they are increasingly central to it.”
2025 saw record signings, with over 47,000 rooms added to the pipeline in India, in the first 11 months of 2025, a figure up 31% on the previous year. Those seeking to get into this market opted increasingly for strategic alliances, as a way to speed up growth.
Among the partnerships agreed in the last year was Marriott’s partnership with The Fern Hotels & Resorts. This has already seen the first Fern properties rebrand under the Series by Marriott brand, promising both parties greater business in future. A first phase of conversions, in November 2025, saw 26 hotels in 23 cities switch to the new format. And, as the year ended, Marriott opened its 200th hotel in India, with the launch of the Westin Jaipur Kant Kalwar Resort & Spa.
In April 2025, Accor announced it had strengthened its partnership with Indian conglomerate InterGlobe, with whom it has previously launched several Ibis hotels in India. The pair will work together, combining their assets and aiming to build out a network of 300 Accor branded hotels by 2030. The partners acquired a majority stake in hotel management specialist Treebo, who will lead on the roll out of Ibis and Mercure hotels, under a master license agreement.
Local Groups Tap Investors
Local hotel groups have enjoyed record performances from this strong market, with Indian Hotels Company executing on a commitment to hit growth targets, expanding its portfolio with the launch of new brands. Conglomerate ITC demerged its luxury hotel division, freeing the business up to grow faster and in more flexible ways in future.
Several other Indian hotel businesses have launched IPOs during 2025, aiming to draw in new investors to support their growth plans, in a market that is looking forward to sustained and continued growth. These included Leela Hotels, Brigade Hotel Ventures, and Suba Hotels. Also promised during 2026 is the much-delayed IPO of the Oyo group, a pioneer in growing branded hotels across India in the lower market segments.
