Rubix Industry Insights: Hospitality Forecasts Strong Growth Driven by Domestic Travel and Foreign Tourist Arrivals
Amid renewed tensions in the subcontinent and broader geopolitical uncertainty, India’s economic weight continues to draw global interest—reflected in a hospitality sector that remains resilient, ambitious, and poised for growth. Rubix Data Sciences’ latest industry report projects a robust future for India’s hospitality sector, with the market expected to surpass ₹1.1 trillion in revenue by FY2027, growing at a CAGR of 10.5%. The report reveals that key performance indicators are at decade highs, driven by resurgent domestic tourism, increasing Foreign Tourist Arrivals (FTAs), and rapid growth in the Meetings, Incentives, Conferences, and Exhibitions (MICE) segment.
According to the Rubix Industry Insights, India’s hospitality sector has made a dramatic comeback from its pandemic low of 35% occupancy, reaching 68% in FY2024. Branded and organised hotels recorded a decade-high performance, with an Average Daily Rate (ADR) of ₹7,500 and a Revenue Per Available Room (RevPAR) of ₹5,439.
This recovery is far from temporary. According to the report, demand will continue to outpace supply, growing at 10.5% annually versus just 8% on the supply side, driving occupancy up to 73% by FY2027. This demand-supply gap is expected to fuel stronger pricing power, pushing ADR to ₹8,900 and RevPAR to ₹6,497. Room inventory will also expand from 1.88 lakh (in FY2024) to 2.41 lakh.
The growth story spans well beyond metros: Western India leads with a 69.5% occupancy rate and the country’s top RevPAR, while destinations like Rishikesh, Udaipur, and Varanasi are emerging as high-yield markets.
Rubix also highlights a shift in demand drivers, with domestic travellers contributing 50% of incremental revenue growth, followed by foreign tourist arrivals at 30% and the MICE segment at 20%. FTAs, a key driver of premium hotel performance, are projected to reach 30.5 million by 2028, reinforcing the sector’s shift toward higher-value travel.
Speaking about the report, Mohan Ramaswamy, CEO and Co-Founder, Rubix Data Sciences said, “India’s hospitality sector is no longer metro-centric; it is thriving in new routes driven by local demand, spiritual tourism, and mid-range experiences. With the industry set to cross $1 trillion by FY2027, the size of the opportunity is huge, but so is the need for risk-aware growth. Our latest report equips stakeholders to facilitate this shift with better visibility and greater strategic confidence.”
Supported by strong infrastructure spending, state-level tourism pushes, and digital-first travel behaviour, India’s hospitality industry is entering a structurally stronger phase. The Rubix sectoral report offers actionable insights for hotel chains, investors, NBFCs, and policymakers charting the sector’s next decade
