Kings of Hospitality

Index : 1,570 | 1Yr : +38.07% | 1Mo : -1.65%

Category : Sectoral Trackers

Min Investment : 1,395

Sharpe Volatility Trend

Hospitality sector is a major engine of employment generation of various kinds in India. Tourism which is a major contributor to travel around the globe is estimated to reach 4 percent by 2025. The Government of India has launched a healthcare portal to encourage medical tourism in India which includes information of all different types of centers spread across tier 1 & tier 2 cities. Wellness travel is also been growing gradually over the years. Government initiatives to ease the entry norms of foreign individuals into the country and a dedicated approach to promote the 'Incredible India' campaign will boost the fortunes of the hospitality industry as a whole.

The Food and Beverage (F&B) industry has seen unprecedented growth in the past and continues to expand rapidly. WIth rising disposable incomes of the urban middle class, this sector has grown at a CAGR of around 23 percent in the last few years. Notable consumption patterns are eating out regularly, price conscious purchases and fast evolving preferences. The industry is highly fragmented and underpenetrated by organized players. Due to the lack of meaningful entry barriers, the sector is prone to heavy competition so only niche and professionally run organization can survive the test of time.

Although the growth potential of the hospitality sector is immense, the ongoing developments especially in the hotel sector is rather lopsided and slightly ahead of time. The room inventory of luxury hotels is being ramped up aggressively which may fall short of demand. With the entry of international brands, this space is going to get more competitive. However, established players who have experience in running successful businesses are expected to continue doing well in the face of competition. After all, in an expanding market, there is room for more than just a few. This theme gives you exposure to companies which are financially better off, have successful and ongoing businesses.

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