Hilton Hyderabad’s Genome Valley Resort
Hilton believes that India will become one of the world’s largest hotel markets as it expands across the Asia-Pacific region.
“India is the most exciting travel and tourism market in the world and will continue to be for the next 10 years,” Alan Watts, Hilton’s president of Asia Pacific, told CNBC’s “Inside India.” He predicted that India would become “the third largest lodging market on the planet.”
The bullish outlook for India comes as weak consumer confidence in China weighs on Hilton’s regional results. Asia-Pacific revenue per available room (RevPAR) increased by just over 1% in the second quarter, but Watts said this was “solely related to our business in China”, which was hit by weaker consumer confidence outside of the holiday period.
Hilton’s other four Asian markets are “growing well,” he said, noting double-digit RevPAR growth in both North Asia and India.
“We’re seeing strong momentum in many markets in the Asia-Pacific region, including Southeast Asia and Japan,” Watts said in a separate interview. “One of the most important trends shaping our business is the strength of intra-Asia travel. Around eight out of 10 nights in the region are now booked by travelers from within Asia, giving us great confidence in the market’s resilience and long-term growth prospects.”
Nomad Hilton Singapore Le Bar
Religious tourism is part of the strategy. Mr Watts said India’s pilgrimage sites such as Ayodhya and Tirupati have “very little supply of branded goods” despite drawing large numbers of people.
Additionally, property owners in India are financing construction themselves, Watts said. “Of course they come to us to manage the property, but we are not asked to commit to the balance sheet.”
Hilton has 60 hotels in various stages of construction in India and has committed to build an additional 400 hotels with key partners. The company is shifting its focus from flagship hotels in tier-1 cities to mid-sized brands such as Hampton and Spark by Hilton that target domestic travelers in tier-2 and 3-tier cities.
Hilton also sees potential for businesses at various levels throughout the region.
“We see opportunities across all price points and continue to benefit from rapid infrastructure investment coupled with increased consumer appetite for travel, a growing middle class and improved connectivity across the region,” Watts said.
-CNBC’s Joanna Ossinger contributed to this article.
