According to a Dolat Capital report citing HVS Anarock data, Ahmedabad and Chandigarh recorded the highest revenue per available room (RevPAR) growth among major Indian hotel markets in May 2026. RevPAR in both cities increased by 24-36% year-on-year, substantially outperforming several larger business and leisure destinations. As reported by Dolat Capital, this performance reflects a decisive catch-up after a prolonged period of weak performance in the hospitality sector, with Ahmedabad emerging as India's fastest-recovering hotel market after reversing a long spell of underperformance.
Ahmedabad's recovery was broad-based, supported by improvements in both room prices and occupancy. According to the Dolat Capital report, the city's average room rate (ARR) rose within the highest growth band of 12-16%, while occupancy increased by 10-20 percentage points. The strong growth also reflects a relatively low comparison base following disruptions that affected travel and hotel activity last year, including Operation Sindoor and the Ahmedabad flight crash, as noted by the brokerage. The city was decisively catching up after a long spell of weak performance, with the strong growth particularly significant given the challenging comparison base from the previous year.
Chandigarh's revival was driven primarily by demand rather than pricing, with hotel occupancy jumping by 20-23 percentage points - the strongest increase among the markets covered. ARR grew by a more moderate 4-8%, resulting in RevPAR growth of about 24-36%. This combination of strong occupancy gains with moderate pricing increases drove the city's impressive performance during the month, highlighting the demand-driven nature of its recovery.
At the national level, India's hotel sector recorded ARR of approximately ₹7,900-8,100 in May, an increase of 9-11% from a year earlier. Occupancy reached 63-65%, while RevPAR rose 22-24% to ₹5,000-5,265. Other cities reported steadier gains, with Goa and Pune registering RevPAR growth of 19-24%, while Bengaluru, New Delhi, Jaipur and Gurugram posted increases in the 14-19% range. Hyderabad, Kolkata and Chennai remained at the lower end, with RevPAR growth of up to 9%. The national performance demonstrates the broad-based nature of the sector's recovery across different market segments.
According to Dolat Capital, the recovery is expected to continue as travel activity strengthens and geopolitical pressures ease. However, the brokerage forecasts more moderate, mid-to-high single-digit RevPAR growth for the June quarter, with hotel companies' aggregate revenue projected to rise about 12% year-on-year. The firm expects the positive momentum to continue as domestic travel demand remains robust and market conditions stabilize across major Indian hotel destinations, with the strong May performance setting a positive foundation for continued growth in the coming quarters.
