After the re-opening of the economy, fortunes of non-essential sectors have improved swiftly. Demand in sectors such as media and entertainment, consumer durables and travel and hospitality showed remarkable improvement.
A key question most sector experts and industry analysts had was: Will the momentum in demand continue after the sudden improvement in demand post the re-opening of the economy? Going by the dynamics in demand, it is clear that the momentum in demand in a few sectors is likely to continue.
Travel and hospitality are two prominent non-essential sectors that are witnessing growing demand since the past few months.
Let us understand a few trends that have contributed to the growth in demand in these sectors: A key indicator that business in travel and hospitality has improved is evident from the June '22 quarter financial performance. For the sake of simplicity, let us consider two most important companies from these sectors.
One is well-known government-owned small-sized travel and hospitality company - India Tourism Development Corporation (ITDC) and the other is Tata Group-backed Indian Hotels Company.
ITDC's net sales grew 114% to ₹94.91 crore in the June '22 quarter on a year-on-year (y-o-y) basis. The company's net profit grew by 595% to ₹10.9 crore in the June '22 quarter on a y-o-y basis.
Indian Hotels Company, on the other hand, posted revenue from operations of ₹1,266 crore for the quarter ended June. This amounts to a 267% jump compared to the corresponding period of the previous fiscal.
The hotel chain posted a profit of ₹181 crore during the quarter under review, compared to a loss of ₹302 crore in the quarter ended June last year.
In 2022, globally, the travel industry has been seeing increased business. This revival is largely because of the re-opening of economies and pent-up demand in travellers.
This story is from the August 2022 edition of Beyond Market.
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This story is from the August 2022 edition of Beyond Market.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
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