Q1FY21 saw a temporary moderation in demand due to the second Covid-19 wave during April-June. Hotel demand, especially in the leisure segment, again started witnessing strong traction with most hotel companies reporting business volumes similar to Q1FY22 in July 2021 itself with the subsiding of Covid cases amid strong vaccination drive. As per industry data, revenue per occupied room (RevPAR) in some leisure destinations has already crossed pre-pandemic levels reflecting the encouraging trend in demand. Corporate segment, which has remained a laggard so far due to work from home culture till Q1FY22, has also been seeing some traction during Q2. Daily passenger air traffic movement has also increased to 58% of pre-Covid levels during Q2 vs. 38% reported in Q1FY22. Overall, we expect Q2FY22E to witness a strong rebound in demand with a pick-up in activities and benefit of lower base effect. Going forward, we expect the tourism demand to reach to pre-pandemic levels sooner than the estimated earlier as the government has allowed airlines to operate with 85% capacity vs. 70% earlier. Also, doors are now open for foreign tourists from November 2021 onwards to visit India that would drive revenues of premium segment hotel rooms. Now for Q2FY22E, we expect premium segment hotel players to report QoQ average revenue growth of ~97% while mid-scale players like Lemon Tree would report revenue growth of 131% QoQ. On a YoY basis, revenues for I-direct universe are expected to improve sharply over 156% YoY.
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