Home > Lockdown Impact > Day 17 | Corporate travel market will pick pace soon; MICE will take a longer while for revival: Ashok Hemrajani
Lockdown Impact

Day 17 | Corporate travel market will pick pace soon; MICE will take a longer while for revival: Ashok Hemrajani

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As the hospitality industry. including many others, remains stranded, during the ongoing pandemic and the nationwide lockdown, Ashok Hemrajani, president, Hotels & Restaurants Association of Telangana State (HRATS), said, “In March, some rooms and restaurants were still operating, hence there was some revenue coming in, but April, following the nationwide lockdown, late March, has seen low to no revenue flow. Brands that are deep-pocketed with better liquidity management will survive the brunt. FHRAI and HAI have already addressed the distressing situation of the industry before the government. Although, RBI and the Centre have agreed to provide moratorium on loans to businesses as well as consumers, the fixed costs such as salaries, utility bills, trade license, property taxes, etc., which will lead to serious liquidity issues moving forward. Also, there is still no clarity on the lifting of the lockdown. Short term impact is that corporates will be scared to travel, but industry-wide organisations want to bounce back as soon as things getting back to normal. Pilgrimage travel might revive little faster, but, leisure and inbound tourism will take a long while to get back to normal, probably 2021 or so. We feel the corporate travel market will revive faster. As travel of corporates, leisure, etc pick up, MICE will also gradually start pacing, but again MICE business will be facing the heat of competitive pricing. Hotels that are strong in F&B, with ample space for banquets, in terms of revival they will have an upper hand over other hotels because it gives the hotels better liquidity as the F&B segment usually sees immediate cash flows. Aging of debt will only come in as a stressor. My fear is that it is going to be a long drawn process for a business to mitigate the current situation and start rebuilding. These are the times of survival of the fittest, as a lot of unbranded hotels depending on aggregators for marketing and bookings are facing a lot of trouble with the ongoing situation as the news about the aggregators holding on to their capital flow is also coming to the fore.  At this stage instead of escalating it too far, one needs to think about how to start afresh as soon as the situation starts getting better.”

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