Against this background, the online travel giant Yatra doubles corporate travel, focusing on the high-growth, technology-driven segment, which accounts for 60% of the business, separating it from direct consumer bookings. .
“Airlines will soon start flying to these airports, which will increase capacity and ease pressure in the top two cities. However, on the hotel side, travelers will be able to overtake the next two to three years. Continue to face high costs. Speaking exclusively to Mint Online Inc.
While some micromarkets within the city have seen pricing stable, the broader trends indicate that substantial cuts are unlikely to occur in the near future. “Instead of double-digit price increases, fees could increase in some regions at low single-digit levels,” Shringi said.
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According to a recent report from hospitality consultant Horwath HTL, the Indian hotel market has only around 200,000 branded rooms, projected to grow to 300,000 by 2029. In 2024 alone, only 14,400 new rooms have been added. 11,700 rooms have been added from the new hotel and 2,000 rooms have been added from brand conversions. And the rest from the previous expansion. This slow pace of growth means that hotel prices are likely to remain high in the short term.
Rating agency ICRA Ltd estimates domestic air force traffic will rise to 164-17 million people in 2005, marking a 7-10% increase from 154 million people the previous year. did. For fiscal 2014, this number could increase to 175 million people.
Hotel prices are unlikely to fall soon, but once new capabilities come online, domestic airfares are expected to stabilize by the second half of 2025.
Jewar International Airport is scheduled to begin operations from April to May, while Navi Mumbai International Airport is set to open towards the end of the year. When airlines start flying to these hubs, additional capacity should help ease congestion at metro airports and stabilize ticket prices.
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Travel: Mixed Bags
Despite the recovery of the travel sector, business travel remains uneven.
Shringi noted that corporate travel has recovered since the pandemic, but that the composition of travelers has changed. Consulting companies, FMCG companies and e-commerce companies have booked more trips than before 2020, but the IT and IT services sector has yet to return to pre-pandemic levels. Manufacturing travel is currently 80-90% of the 2019 level, and IT companies are still operating at 60-70% of their previous travel capabilities.
“The IT sector should grow overall as there is a lot of investment in artificial intelligence and other things that are occurring around the world. Over the next two or three quarters, their spending will also start to rise.” He said.
Despite concerns about slowing economic growth in sectors such as FMCG and manufacturing, Yatra has yet to see a decline in corporate travel demand. Shringi believes its diverse client base will help its isolation from the recession. “We acquired new business customers, which helped offset slower spending from existing clients,” he said.
Meanwhile, religious tourism has emerged as a high yield segment driven by increased disposable income and better infrastructure at major pilgrimage sites. Events like Mahakam, which are expected to attract 500 million visitors, highlight this shift.
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The line between India and “Bharat” is beginning to blur, Singh said, adding that it is no longer a metropolitan tourist heading towards religious tourism.
“We will not see a slower demand for travel in the near future due to the major cultural changes that are happening in India and how people will use their disposable income,” he said.
In the calendar year of 2024, Pan India Hotel’s occupancy was 63.9%, approaching the level of 2008, marking the highest performance ever for the sector. Average daily room rates for all hotel categories approached £8,000 and revenue per room available (RevPar) exceeded £5,000 highlights strong demand despite continued capacity constraints.
Hotel occupancy in December 2024 is approaching pre-pandemic levels, with a steady year-over-year growth, according to hospitality consultant HVS. Major markets such as Mumbai, Kolkata, Ahmedabad and Kochi report occupancy rates above 80%, with Mumbai leading at 81-83%.
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Kochi was the highest year-on-year, up 5-7%. However, markets like Chandigarh and Hyderabad recorded a decline of 2-5% points. Average room rates (arr) saw modest growth but rose in most markets except Goa, which maintains the highest arr in the country £14,000. Kochi also led ARR growth due to strong demand.
Yatra’s Growth Engine
Yatra doubles corporate travel and is shifting away from the consumer segment. There is a strong competition and customer acquisition costs.
“Corporate enterprise businesses are inherently much safer,” Shringi said, explaining that B2B margins are a direct contribution to operating profit, unlike significantly discount-driven consumers. “(w)e doesn’t have to continually direct companies with discounts to purchase our packages. We’ve seen the lifelong value of our business customers.”
The Indian corporate travel market £1. It is 25 trillion units and has not been invaded in terms of digital adoption, making it an advantageous opportunity for online travel agencies.
Shringi said that corporate demand for air travel, large events and company offsite (such as meetings and incentive programs) is set to become a strong growth driver for Yatra. “The kind of growth we drive in this business is primarily behind the growth of corporate travel,” he said.
“Over the next two years, over the next two years, we will continue to expand our corporate business at a much faster pace at 25-30%. This type of growth will drive growth of around 40-50%. Profit terms,” said Shringi.
That momentum is already seen in Yatora’s finances. In the third quarter, fiscal year 2025, revenue increased 111% year-on-year £235 crores, company shook from a £39 crore loss last year £Profit of 39 crores this quarter. However, the adjusted ticket margin fell by 23%, mainly due to the small volume of the consumer segment as Yatra expanded its back discounts in response to aggressive price competition.
Meanwhile, the company’s marketing and promotion costs rose 9.4% year-on-year. £11.4 crore for the quarter ended December 31st £10.4 crores for the same period last year.
Yatra’s corporate travel business focuses on large companies, but the company is expanding to small and medium-sized businesses.
Shringi said online travel companies traditionally target India’s top 5,000-10,000 companies, but now there is a huge demand from small businesses that lack direct negotiation power with airlines and hotels. There is. To address this gap, Yatra develops specialized products tailored to small and medium-sized business clients.
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The company is also looking at new opportunities. It is an individual trip for employees of the corporate clients that provide services. With over 500,000 employees working for companies using Yatra’s services, the company sees significant potential to offer personal travel packages through its platform.
There is a great opportunity there, Shringi added.
