K Raheja Corp-backed hotel ownership company Chalet Hotels Limited is expanding its focus to deeper leisure markets such as Jaipur, Jodhpur and Pune, while evaluating opportunities in Hyderabad’s financial district as it builds a broader national pipeline.
Speaking to Mint, managing director and CEO Shwetank Singh said the company is scaling steadily across city hotels, airport properties and leisure resorts as demand continues to outpace supply despite short-term disruptions.
“We are going to go into deep leisure markets like Jaipur, Jodhpur, Pune and also evaluating Hyderabad financial district,” Singh said.
“The underlying demand supply story is strong— demand is growing faster than supply. We sustained a strong pricing-led growth, driving healthy RevPAR (revenue per available room) expansion growth across key markets. Our commercial real estate portfolio also maintained strong momentum, with rental income continuing to scale steadily through the year. We are backed by a robust portfolio and are well positioned to capitalise on the long-term demand opportunity,” he said.
RevPAR is a key hotel industry metric that measures revenue generated per available room.
India’s hospitality sector is expanding steadily, with branded inventory expected to cross 350,000 rooms by FY30, according to a recent report by HVS Anarock and Gleeds Consulting. Growth is being led by listed owners such as Chalet, Indian Hotels and Lemon Tree Hotels amid rising investment activity. Strong domestic travel demand continues to absorb new supply across major markets.
The company currently operates 3,389 keys under brands such as JW Marriott, The Westin and Novotel, and has 1,655 rooms under development.
Its upcoming pipeline includes the Taj Delhi International Airport hotel, slated to open in Q4 FY27, while the Ritz-Carlton Hyderabad and Hyatt Regency Airoli remain under construction in FY27. Most projects are structured through group-linked land parcels or partnership models to reduce acquisition risk and improve execution visibility.
Leisure push
A key part of Chalet’s strategy is increasing exposure to leisure-led destinations, particularly drive-to markets within 1.5-2 hours of major airports.
Singh said Jaipur and Jodhpur offer strong domestic tourism demand and relatively stable occupancy cycles compared to metro city hotels. Pune and Hyderabad’s financial district are part of a broader push into high-demand urban and leisure-adjacent markets.
Chalet’s leisure portfolio already includes properties in Goa. In February 2025, it acquired The Westin Resort & Spa Himalayas in Rishikesh for ₹530 crore. A year earlier, it bought the 158-room Marriott Aravali Resort for ₹315 crore.
However, Singh noted that resort margins are structurally lower than city hotels, even if they offer better portfolio diversification.
Micro-market pressures
Operational performance in some city clusters remains uneven, particularly in Mumbai’s airport micro-market, where new luxury supply has risen sharply.
The Sahar-airport cluster has seen multiple new hotel openings, affecting demand flows that previously benefited Chalet’s nearby assets.
“New supply has come in sharply in the airport market. That has impacted demand flow across the micro-market,” Singh said.
Earlier this week, IHG Hotels & Resorts, the company that runs Crowne Plaza, Intercontinental and other brands, said it has signed an agreement with Adani Airport Holdings to develop about 1,500 hotel rooms across five properties in India.
Construction activity in Chalet’s Mumbai cluster also temporarily affected banquet and meetings demand, along with some loss of room nights. Despite this, Singh said the company’s luxury positioning helped maintain relative resilience.
On the broader outlook, Singh remained bullish.
“There will be short-term shocks, smaller, very short-term shocks. Post-covid, there is no stopping this industry. It is a high-touch human business and will always remain attractive.”
He added that while rate cycles may see temporary pauses due to the war, there is no expectation of a sustained correction in pricing power.
Foreign tourist arrivals were volatile in March, affecting Mumbai more than other markets due to its reliance on international travel. However, domestic demand supported occupancy, with April performance described as better than expected.
Capital discipline
Despite an aggressive expansion cycle, the company said growth remains largely self-funded.
“We are not restricted by capital. We are restricted by clean capital discipline,” Singh said.
Chalet reported FY26 revenue of ₹2,769.75 crore, up about 61% from ₹1,717.8 crore in the previous year. Net profit rose to ₹645.3 crore from ₹142.3 crore in FY25.
March was a difficult month for the industry due to the West Asia war and a general dip in travel. Still, Chalet reported an average room rate of ₹15,456 in Q4, up 8% year-on-year. Average occupancy stood at 68%, down 7.7 percentage points from Q4 FY25.
While near-term performance varies across micro-markets, Singh remains confident in the long-term trajectory of Indian hospitality demand, driven by domestic travel growth and infrastructure expansion.
“There will be changes, but fundamentals will stay the same. It is a human business, and people will always travel,” Singh said.
