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NEWS | Falling foreign tourists arrivals, low demand signal muted growth for premium hotels companies

In the last three years, foreign tourists arrivals have increased by a compounded annual growth rate of 7.2%. This is a marked shift in the arrivals of foreign tourists arrivals, which slowed down in 2009, picked up in the last three calendar years. According to the web site of Ministry of Tourism, the number of foreign tourists arrivals have grown to 6,64,9000 in 2012 from 5,77,6000 in 2009.
Interestingly, the fall in the rupee in comparison with the dollar has also enhanced the foreign exchange earnings in the last three years. In the last three years, the foreign exchange earnings have from a low base in 2009, at a compounded annual growth rate of 20%. A substantial part of this growth has come in 2010 and 2011. For hotels companies, however, this growth would not translate into huge revenues. Premium hotels companies derive 70% of total revenues from foreign tourists arrivals.


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