The company, which operates 136 hotels across India, including 75 under its flagship Sarovar Portico brand, plans to add 16-20 more properties this year.
A subsidiary of Paris-based Groupe Du Louvre, Sarovar is also eyeing international expansion while ensuring its profitable streak—even through the pandemic—remains intact.
The company has been growing at around 15% CAGR since before the pandemic and, in 2024, its hotels and corporate hospitality services collectively grossed ₹3,000 crore.
“There are a lot of opportunities to sign brands up, but we now want to be more choosy about the types of hotels we work with,” said Ajay K. Bakaya, chairman, Sarovar Hotels and Resorts & director of Louvre Hotels India.
Bakaya spoke to Mint in an exclusive interview on the sidelines of the recently concluded hospitality & travel summit, HVS Anarock Hope 2025 in Goa.
Hospitality’s golden era
In the calendar year 2025 too, the company is planning to project double-digit growth for the three decade old company. The company currently manages properties in the 3-, 4- and 5-star categories under its four brands — Sarovar Premiere and Portico, Golden Tulip and 3-star brand Hometel.
The business recorded a compound annual growth rate (CAGR) of 12% in 2024, with 9% growth on a same-store or like-for-like basis. Same-store basis measures revenue growth from existing locations, excluding new or recently closed ones.
Revenue, too, is up 15% compared to pre-pandemic levels, driven by rising demand across key markets. Sarovar’s hotels in India crossed ₹2,000 crore in revenue last year, with ₹1,000 crore coming from its institutional catering business, which serves major clients like IIMs, ISB campuses, and Hindustan Unilever complexes.
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“Demand is quite strong and for the first time, Indian hotel companies are charging hotel rates that correspond with the product that they’re offering, at least in the metro cities and some major travel hubs,” said Bakaya.
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“We’ve been a profitable business since the first year when we opened. In fact, we were also in the green during the pandemic,” he added.
In January the company opened its newest hotel in Pilibhit, UP, giving the city its first branded hotel. It also opened in locations like Deogarh, Jharkhand, Amritsar, Punjab and Goa at the end of 2024.
Growth like never before
Bakaya sees the next four years as a strong period for the Indian hotel industry, with double-digit growth expected until the next election cycle.
Sarovar’s average daily rate (ADR) across its brands is ₹5,500, with occupancy rising to 70%—up from 66-67% before the pandemic.
Spiritual tourism destinations are also a growing focus for Sarovar. The company operates the only branded hotel in Ayodhya at present, where ADRs hover around ₹9,000, and 10% of its business now comes from religious destinations.
This makes sense, as a recent report by Horwath HTL said the entire leisure sector room inventory has about 61,000 rooms in India which is 30% of total supply. This figure has grown five times in size since 2008 and is expected to add another 45,000 rooms by the end of 2029.
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“Among leisure destinations are also destinations for spiritual tourism – several that are primarily focused on the religious aspect and some others that have a mix of religious and leisure purpose to their travel. Such inventory is about 12,000 rooms. We see this growing, at least in absolute numbers, as the upper tier society does want to travel to these destinations and needs,” said India Hotel Market Review 2024 by hotel consultancy Horwath HTL.
Closer to home, Sarovar is repositioning its other four-star hotel brand Golden Tulip—comprising 15 hotels—with plans to expand the portfolio and potentially introduce the upscale Royal Tulip brand to India.
“We have the potential to bring this brand (Royal Tulip) to India in addition to our Sarovar and four-star Sarovar Portico brands. We are repositioning it to be an international brand,” said Bakaya.
“The company would also consider franchising the Golden Tulip brand if the right opportunity presents itself,” he said.
While the company franchises about 10 properties, Bakaya ruled out franchising its core Sarovar brand, citing concerns over maintaining quality standards.
It plans to add 15 new properties in 2025. In the first quarter, the brand has opened hotels across brands in Bhopal, Sindhudurg, Ajmer and Srinagar. The upcoming hotel locations include Sriperumbadur, Alwar, Gurugram, Mathura, Jim Corbett, Pathankot, Kota, Chitwan Nepal, Hargeisa in Somaliland.
Investment challenges
For the company, business travel has also rebounded in key metros like Mumbai, Delhi, Hyderabad, Chennai, and Bengaluru, though Bakaya said foreign business travel remains below pre-pandemic levels.
Its ambitions also extend beyond India. The company operates one hotel in Nepal with eight more in the pipeline, and it plans to open in Kampala, Uganda, this year. It also manages a property in Somaliland and is exploring opportunities in the Middle East.
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Despite the growth, Bakaya believes the industry needs more government support to drive hotel investments.
“We need some incentive from the government for there to be more investments in hotels. Even today, the return on investments in the sector don’t make sense as the cost of capital and land is quite high and it can take up to 20 years for returns to start coming in for investors. There is a lot of hope for the sector as this is an area which is dying to get to its potential,” Bakaya added.