- 24 Apr 2025
- ICICIdirect Research
TRAVEL FIRMS AND HOTELS ARE WITNESSING CANCELLATIONS DUE TO TERROR ATTACK IN PAHALGAM
INDHOTEL - 761 Change: -8.05 (-1.05 %)News: Travel firms and hotels are witnessing cancellations due to terror attack in Pahalgam (Jammu & Kashmir) during the peak season. While local operators are worried, some industry people are hopeful of demand revival in the medium to long term. A tour operator from Srinagar said 90% of the bookings till June this year have been cancelled. He added many families have rescheduled tickets, which is why there is a huge rush at the airport. According to media reports Tourist arrivals in Kashmir surged in the past five years, rising from 665,777 in 2021 to a record 34,98,702 in 2024, a more than fivefold jump in four years.
View: We believe tourist arrival in Kashmir will take a halt for sometime and domestic travelers will switch to other domestic tourist destinations in the near term. We see no major impact of cancellations on hotels under our coverage including Indian Hotels, Chalet Hotels and Lemon Tree hotels. IHCL operates two properties in J&K under management contract while lemon tree hotels operates 4 hotels under the management contract. Chalet hotels does not operate any property in J&K. Cancellations will have large impact on the profitability of tour operators.
Impact: Neutral