The hospitality sector in India is set for a period of sustained growth, and as a result Indian hotel chains alone are expected to add more than 70,000 rooms within the next five years.
A report by consultants CBRE drew out the numbers, based on the situation in early 2026. Fundamental demand drivers include the expected surge in domestic tourism, underpinned by rising real incomes in India. The consultants define this development as moving from a post-pandemic recovery, into a phase of structural maturity. They expect the market size of the Indian hotel sector to grow from USD24.6 billion in 2024, to USD31 billion by 2029.
Improving Operational Performance
During 2025, occupancy levels improved to an average 64%, helping to drive up revpar by 11% across the market. Average room rates also strengthened, by around 8.7%. Institutional investors are following the performance, and in 2025, deal volume in the Indian hotel market hit USD456 million, a figure more than double that of the previous year.
Local businesses are reacting. The Indian Hotels Company is pushing ahead with a rapid expansion programme, growing its brands including Taj, Vivanta and Ginger. It recently opened the 135 room Vivanta Vrindavan, and Gateway Dehradun. For the group’s main Taj luxury brand, the 350 room Taj Indore is currently under construction, as is the Taj Sky View Hotel and Residences in Chennai.
Luxury hotel group ITC is also expanding, having demerged its hotel division from the main conglomerate. Its pipeline includes a Welcomhotel in Gwalior, and in Jawai, a Storii branded property that is as much an adventure camp as a hotel.
“As the industry accelerates its transition towards experience-driven travel and captures institutionalised demand across spiritual and cultural centres, we anticipate robust long-term expansion for the country’s hospitality ecosystem,” said Anshuman Magazine, CBRE chairman and CEO for India, Southeast Asia, the Middle East and Africa.
The international brands are also looking for ways to expand their presence. Hyatt, for example, wants to double its Indian hotel portfolio by 2030, and is partnering with Brigade Ventures to grow. Its pipeline includes Hyatt Regency hotels in Kasauli, Guwahati, Ghaziabad and Surat.
Big Brands Establish Market Presence
IHG is also signing multiple deals to bring its brands to India. It will open Holiday Inn hotels this year in Bodhgaya, Chennai, Prayagraj and Udaipur ahead of a long pipeline for both Holiday Inn, and Holiday Inn Express. At the top of its brand portfolio, it has signed to add InterContinental luxury hotels in Kasauli, New Delhi and Hyderabad. Also in the works is InterContinental Kodaikanal Resort, a luxury retreat with guest accommodation in individual cottages, set in the countryside of Tamil Nadu.
Hilton is also looking for ways to grow in India, and relying on strategic partnerships. Its Hampton by Hilton brand will grow with the support of Royal Orchid Hotels, while local partner Olive Hospitality has been tasked with signing hotels to the Spark by Hilton brand.
