Rains drag Q2 growth for hotels; festive, MICE demand to drive H2

An extended monsoon slowed Q2 occupancy for hospitality players, but brokerages expect a strong second half led by MICE, festive, and wedding demand

An extended spell of rains impacted occupancy in the hospitality sector even as average room rates (ARR) remained resilient in the September quarter (Q2FY26), according to brokerages tracking the sector. They expect a strong second half of FY26, driven by increased meetings, incentives, conferences and exhibitions (MICE) activity, festive season demand, and steady corporate travel.

 

“We believe heavy monsoons have impacted domestic leisure travel demand in Q2, coupled with a seasonally lean period for foreign tourist arrivals (FTA). This is expected to be partially offset by sustained momentum in business and metro destinations, led by robust MICE demand