ICRA – The Indian Hospitality Industry

The Indian hospitality industry is expected to continue robust performance in FY2026 and FY2027.

The credit profile of hospital companies is projected to remain healthy despite sizeable capital expenditure, with revenue growth of 16-18% and operating profit margins of 22-24% expected in FY2026. Aggregate occupancy rates are estimated at 62-64%, and ARPOB growth is projected at 6-8%. Structural tailwinds include market share gains for organized players, rising insurance penetration, and increasing incidence of non-communicable diseases. Significant investments are planned for bed additions and expansions in metros and tier-II and tier-III cities.