The leisure and travel sector in India encompasses a wide range of services, including tourism, hospitality, transportation, and related activities. Investing in this sector offers potential for substantial returns, given its rapid growth and resilience. This article provides an overview of the leading companies in this sector, their market positions, and the unique features that define leisure and travel stocks in India.
What are Leisure and Travel Stocks?
Leisure and travel stocks represent companies engaged in providing services related to tourism, hospitality, and recreational activities. These companies may operate in various segments, such as airlines, hotels, travel agencies, and entertainment providers. Investing in these stocks allows investors to participate in the growth of the tourism and hospitality industry.
Leisure and Travel Industry in India
India's travel industry contributes significantly to the country's GDP, with projections indicating continued growth in the coming years. The sector includes a diverse range of companies, from state-owned enterprises to private players, each catering to different aspects of travel and tourism.
What are the Features of Leisure and Travel Stocks in India?
Investing in leisure and travel stocks in India offers several distinctive features:
● Growth Potential: With rising disposable incomes and an increasing middle-class population, the demand for travel and leisure services is on the rise, presenting growth opportunities for companies in this sector.
● Diverse Offerings: The sector encompasses various segments, including transportation, accommodation, and entertainment, allowing investors to diversify their portfolios within the industry.
● Government Initiatives: Supportive government policies aimed at promoting tourism, such as infrastructure development and marketing campaigns, further enhance the prospects of companies in this sector.
● Technological Advancements: The adoption of technology, such as online booking platforms and digital payment systems, has improved customer experiences and operational efficiencies, benefiting companies in this industry.
Investing in India's leisure and travel sector provides an opportunity to capitalize on the country's burgeoning tourism industry. With a variety of companies offering diverse services, investors can find opportunities that align with their investment strategies and risk appetites.
Top Leisure and Travel Stocks in India as per Market Capitalisation
The following table presents the top leisure and travel stocks in India based on market capitalisation:
Company Name
| Last Price (₹)
| % Change
| 52-Week High (₹)
| 52-Week Low (₹)
| Market Cap (₹ Cr.)
| Industry
|
InterGlobe Aviation
| 4,627.55
| -0.64
| 5,035.00
| 3,020.00
| 178,819.35
| Airlines
|
Indian Hotels
| 741.00
| -0.44
| 894.90
| 506.45
| 105,476.33
| Hotel, Resort & Restaurants
|
ITC Hotels
| 169.38
| -2.21
| 180.00
| 155.10
| 35,250.88
| Hotel, Resort & Restaurants
|
EIH
| 341.10
| 0.40
| 502.20
| 305.00
| 21,331.17
| Hotel, Resort & Restaurants
|
Chalet Hotels
| 793.35
| 0.39
| 1,052.45
| 634.05
| 17,331.16
| Hotel, Resort & Restaurants
|
Source: MoneyControl as of 11 Mar 2025
Overview of Leisure and Travel Stocks in India by Market Cap
This brief table provides an overview of key players in India's leisure and travel sector:
Company Name
| Market Cap (₹ Cr.)
| Industry
|
InterGlobe Avi
| 178,819.35
| Airlines
|
Indian Hotels
| 105,476.33
| Hotel, Resort & Restaurants
|
ITC Hotels
| 35,250.88
| Hotel, Resort & Restaurants
|
EIH
| 21,331.17
| Hotel, Resort & Restaurants
|
Chalet Hotels
| 17,331.16
| Hotel, Resort & Restaurants
|
Source: MoneyControl
InterGlobe Aviation Ltd. (IndiGo)
InterGlobe Aviation Ltd. operates IndiGo, India's largest airline, providing domestic and international air travel services. The company has demonstrated strong market performance, with a market capitalization of ₹178,819.35 crore.
Key Stock Metrics:
Metric
| Value
|
Last Price
| ₹4,627.55
|
% Change
| -0.64%
|
52-Week High
| ₹5,035.00
|
52-Week Low
| ₹3,020.00
|
Market Cap
| ₹178,819.35 Cr
|
P/E Ratio
| 29.38
|
Book Value Per Share
| ₹98.37
|
Source: MoneyControl
Performance Highlights:
● Revenue has been growing consistently, driven by increasing passenger demand.
● Expansion into long-haul flights, such as new direct flights to Manchester and Amsterdam, is expected to boost growth.
Indian Hotels Company Ltd.
Indian Hotels Company Ltd. (IHCL) is a leading hospitality group in India, operating under the Taj Hotels, Taj Safari, The Gateway, and Ginger brands. The company is known for its luxury and premium hotel chains.
Key Stock Metrics:
Metric
| Value
|
Last Price
| ₹741.00
|
% Change
| -0.44%
|
52-Week High
| ₹894.90
|
52-Week Low
| ₹506.45
|
Market Cap
| ₹105,476.33 Cr
|
P/E Ratio
| 58.48
|
Book Value Per Share
| ₹71.35
|
Source: MoneyControl
Performance Highlights:
● IHCL has reported a 26.08% YoY stock performance due to improved revenue streams from tourism and hospitality recovery.
● It has introduced new brands and experiences, including SeleQtions and Ginger expansion.
ITC Hotels Ltd.
ITC Hotels is a hospitality subsidiary of ITC Ltd., operating high-end hotels, resorts, and fine-dining establishments. It has a market cap of ₹35,250.88 crore and operates across premium and luxury hotel segments.
Key Stock Metrics:
Metric
| Value
|
Last Price
| ₹169.38
|
% Change
| -2.21%
|
52-Week High
| ₹180.00
|
52-Week Low
| ₹155.10
|
Market Cap
| ₹35,250.88 Cr
|
Sector PE
| 85.19
|
Source: MoneyControl
Performance Highlights:
● ITC Hotels has been expanding its premium and luxury segment offerings.
● The company is well-positioned in the hospitality industry despite recent market fluctuations.
EIH Ltd. (The Oberoi Group)
EIH Ltd. operates the Oberoi and Trident hotel chains, known for luxury and premium hospitality experiences. The company has been actively expanding into international markets.
Key Stock Metrics:
Metric
| Value
|
Last Price
| ₹341.10
|
% Change
| 0.40%
|
52-Week High
| ₹502.20
|
52-Week Low
| ₹305.00
|
Market Cap
| ₹21,331.17 Cr
|
P/E Ratio
| 30.08
|
Book Value Per Share
| ₹65.40
|
Source: MoneyControl
Performance Highlights:
● EIH Ltd. has reported a YoY net sales growth of 7.95%, indicating strong operational performance.
● The company continues to maintain high occupancy rates and premium hospitality services.
Chalet Hotels Ltd.
Chalet Hotels Ltd. operates in the hospitality sector with a focus on business hotels and luxury accommodations. It has shown consistent growth in revenues and profitability.
Key Stock Metrics:
Metric
| Value
|
Last Price
| ₹793.35
|
% Change
| 0.39%
|
52-Week High
| ₹1,052.45
|
52-Week Low
| ₹634.05
|
Market Cap
| ₹17,331.16 Cr
|
P/E Ratio
| 171.35
|
Book Value Per Share
| ₹128.85
|
Source: MoneyControl
Performance Highlights:
● Chalet Hotels' net sales increased by 22.51% YoY, indicating strong business growth.
● The company has been expanding its hotel portfolio, acquiring new properties in key tourist destinations
What Factors Should One Consider Before Investing in Leisure and Travel Sector Stocks in India?
Investing in the leisure and travel sector in India requires a comprehensive analysis of several key factors:
● Government Regulations and Policies: The travel industry is subject to various regulations, including environmental policies aimed at reducing carbon emissions. Investors should assess how companies adapt to these regulations and their commitment to sustainable tourism practices.
● Economic Conditions: The performance of the travel sector is closely linked to the overall economy. During economic downturns, discretionary spending on travel tends to decrease, impacting revenues of travel companies.
● Company Financial Health: Analyzing a company's financial statements, including revenue growth, profit margins, debt levels, and cash flow, is crucial. Strong financial health indicates resilience during economic fluctuations.
● Technological Integration: Companies leveraging technology to enhance customer experience, such as online booking systems and personalized services, are better positioned in the market.
● Market Competition: The travel industry is highly competitive, with numerous players offering similar services. Understanding a company's competitive advantage, such as unique offerings or superior service quality, is essential.
What Factors Influence the Performance of Leisure and Travel Stocks?
Several external and internal factors can influence the performance of leisure and travel stocks:
● Economic Indicators: Inflation rates, consumer spending power, and overall economic health significantly affect travel demand and company profitability.
● Fuel Prices: For airlines and cruise lines, fuel costs constitute a major expense. Fluctuations in oil prices can substantially impact their bottom lines.
● Geopolitical Events: Political tensions, travel restrictions, and security concerns can quickly alter travel patterns and impact stock performance.
● Exchange Rates: Fluctuations in exchange rates can affect international travel demand and profitability for companies operating globally.
● Technological Advancements: Integration of new technologies can enhance operational efficiency and customer satisfaction, influencing a company's market position.
How Do Leisure and Travel Stocks Work?
Leisure and travel stocks represent ownership in companies that provide services related to tourism, hospitality, and recreation. The performance of these stocks is influenced by:
● Revenue Streams: Derived from services like airline tickets, hotel bookings, and tour packages. Higher demand leads to increased revenues.
● Operational Costs: Expenses such as fuel, labor, and maintenance. Efficient cost management can improve profit margins.
● Seasonality: Travel demand often fluctuates with seasons, affecting quarterly earnings.
● External Factors: Economic conditions, geopolitical events, and health crises can impact travel demand and, consequently, company performance.
Tips for Investing in Leisure and Travel Industry in India
When considering investments in India's leisure and travel industry, keep the following tips in mind:
● Diversify Your Portfolio: Invest across various segments such as airlines, hotels, and travel agencies to mitigate sector-specific risks.
● Monitor Economic Indicators: Keep an eye on economic trends, as they directly influence travel demand.
● Utilize Analytical Tools: Employ tools like a brokerage calculator to assess potential returns and costs associated with investments.
● Stay Informed About Upcoming IPOs: New entrants can offer fresh investment opportunities.
● Understand Margin Trading Facilities (MTF): Leveraging MTF can amplify gains but also increases risks; ensure it aligns with your risk tolerance.
● Consider Intraday Trading: For experienced investors, intraday trading can capitalize on short-term market movements, but it requires a solid understanding of market dynamics.
● Open a Trading and Demat Account: Ensure you have the necessary accounts to facilitate seamless transactions in the stock market.
By thoroughly evaluating these factors and strategies, investors can make informed decisions in the leisure and travel sector, aligning with their financial goals and risk appetite.
How to Pick Leisure and Travel Stocks
Selecting the right stocks in the leisure and travel industry involves several key considerations:
● Financial Performance: Analyze companies' financial health by examining metrics such as revenue growth, profit margins, and debt levels. For instance, companies like Royal Caribbean have reported strong earnings, indicating robust financial performance.
● Market Position: Consider companies with a strong market presence and brand recognition. For example, Travel + Leisure Co. has shown significant growth, with shares surging 46.6% over the past year, outperforming industry averages.
● Innovation and Adaptability: Companies that innovate and adapt to changing consumer preferences are better positioned for long-term growth. For instance, Atour Lifestyle has developed a unique retail strategy by turning hotel rooms into showrooms, enhancing customer experience.
● Economic Indicators: Monitor economic factors such as consumer spending trends, inflation rates, and GDP growth, as they directly impact the travel industry.
● Regulatory Environment: Stay informed about government policies and regulations affecting the travel sector, including environmental policies and travel restrictions.
Who Should Explore Leisure and Travel Stocks?
Investing in leisure and travel stocks may be suitable for:
● Long-Term Investors: Individuals seeking growth over an extended period may find opportunities in this sector, especially as global travel demand rebounds post-pandemic.
● Diversified Portfolios: Investors looking to diversify their portfolios can consider leisure and travel stocks to balance exposure across different industries.
● Risk-Tolerant Investors: Given the sector's sensitivity to economic cycles, those with a higher risk tolerance may explore these stocks for potential high returns.
Why Invest in Leisure and Travel Stocks?
Several reasons make investing in this sector appealing:
● Post-Pandemic Recovery: The travel industry is experiencing a resurgence as restrictions ease and consumer confidence returns. For example, Royal Caribbean's stock rallied after reporting impressive quarterly earnings, driven by robust demand from Millennials and Gen Z consumers.
● Technological Advancements: Innovations such as online booking platforms and personalized travel experiences enhance customer satisfaction and operational efficiency.
● Economic Growth: A growing middle class with disposable income contributes to increased spending on leisure and travel, bolstering the sector's prospects.
Should You Invest in Leisure and Travel Stocks?
Before investing, consider the following:
● Volatility: The travel industry is susceptible to external factors like economic downturns, geopolitical events, and health crises, leading to potential volatility.
● Company Fundamentals: Assess the financial health and strategic direction of companies to ensure they align with your investment goals.
● Diversification: Avoid overexposure by balancing investments across various sectors to mitigate risks.
Incorporating leisure and travel stocks into your investment strategy requires careful analysis and consideration of your financial objectives and risk tolerance.
What are the Risks of Investing in Leisure and Travel Stocks in India?
Investing in leisure and travel stocks in India involves multiple risks:
● Economic Sensitivity: The leisure and travel industry is cyclical, and during downturns, discretionary spending declines. Investors using a trading account or demat account should assess economic trends before making investments in this sector.
External Shocks: Global events such as pandemics, natural disasters, or geopolitical tensions can abruptly impact the performance of travel-related companies. Before engaging in intraday trading, investors should factor in these external risks that may cause high volatility in stock prices.
● Regulatory Challenges: Frequent policy changes in tourism taxation and visa regulations can affect business profitability. Investors using a brokerage calculator to estimate costs should include regulatory risks in their calculations.
What are the Advantages of Investing in Leisure and Travel Stocks in India?
Despite the risks, the leisure and travel sector offers notable benefits:
● Growth Potential: India’s tourism sector is projected to expand rapidly. Investors tracking an upcoming IPO in hospitality or airline companies should consider long-term demand growth in this industry.
● Rising Disposable Incomes: As middle-class spending increases, companies in hospitality and travel services are seeing higher revenues. Those using MTF (Margin Trading Facility) to amplify their investments should be aware of demand trends in this sector.
● Government Support: Policies like tax benefits for tourism infrastructure and digital visa processing promote growth in the industry, making travel stocks attractive for long-term investors.
Who Can Invest in Leisure and Travel Stocks?
Leisure and travel stocks are suitable for various types of investors:
● Long-Term Investors: Those looking to build a strong portfolio with growth potential can benefit from travel stocks. When opening a trading account, investors should focus on companies with strong fundamentals.
● Risk-Tolerant Traders: Intraday trading in travel stocks is common due to market fluctuations. Short-term traders should monitor volatility closely and use stop-loss strategies.
● Diversification Seekers: Investors wanting to balance their exposure across industries may include travel stocks to hedge against fluctuations in other sectors.
Is Investing in Leisure and Travel Stocks Risky?
Yes, investing in leisure and travel stocks comes with inherent risks:
● Market Volatility: These stocks can experience sharp price swings. Investors using MTF should be cautious of margin risks when trading in this sector.
● Operational Uncertainty: Fuel price fluctuations, seasonality, and external economic factors can make earnings unpredictable. Those using a brokerage calculator should evaluate long-term holding costs before investing in travel stocks.
● Seasonal Variability: Travel demand surges during holiday seasons but drops during off-peak months. Short-term investors, especially those involved in intraday trading, should account for seasonal performance trends.
Investors must carefully assess these factors before making decisions in this sector.
How To Invest In Leisure and Travel Stocks
1. Open a Trading Account and Demat Account: To begin investing, you'll need both a trading account and a demat account with a SEBI-registered broker. The trading account facilitates buying and selling of stocks, while the demat account holds your shares electronically.
2. Research Potential Investments: Identify companies within the leisure and travel sector, such as airlines, hotel chains, and travel agencies. Analyze their financial health, market position, and growth prospects. For instance, companies like IRCTC and EaseMyTrip are notable players in this sector.
3. Utilize Brokerage Tools: Use a brokerage calculator to estimate transaction costs, taxes, and potential returns. This helps in making informed decisions and managing investment expenses effectively.
4. Consider Margin Trading Facility (MTF): Some brokers offer MTF, allowing you to buy stocks by paying a fraction of the total value upfront, with the remainder being financed by the broker. While this can amplify gains, it also increases risk and should be used cautiously.
5. Stay Informed About Upcoming IPOs: Keep an eye on upcoming IPOs in the leisure and travel sector. Investing in IPOs can provide opportunities to enter at the ground level of potentially high-growth companies.
What is the Impact of Government Policies on Leisure and Travel Stocks?
Government policies significantly influence the performance of leisure and travel stocks:
● Infrastructure Development: Investments in tourism infrastructure, such as heritage sites and smart tourism projects, can enhance the attractiveness of destinations, benefiting companies in this sector.
● Economic Support Measures: During events like the COVID-19 pandemic, government economic support policies have been found to increase airline stock returns, highlighting the importance of supportive fiscal measures.
How Leisure and Travel Stocks Perform in Economic Downturns
Leisure and travel stocks are typically cyclical and sensitive to economic conditions:
● Reduced Consumer Spending: During economic downturns, discretionary spending decreases, leading to reduced demand for travel and leisure services. This can result in lower revenues and profitability for companies in this sector.
● Stock Performance: The cyclical nature of the industry means that travel stocks often see declines during economic slowdowns, as observed in various market analyses.
Leisure and Travel Sector Highlights from Union Budget 2025-2026
The Union Budget 2025-2026 introduced measures impacting the leisure and travel sector:
● Increased Tourism Budget: The overall tourism budget was increased by nearly 4% to INR 25.4 billion ($293 million), indicating government support for the sector's growth.
● Interest-Free Loans for States: The government proposed interest-free loans to states for the development of iconic tourist destinations, aiming to boost domestic tourism and infrastructure.
Future Trends and Opportunities of Investing in Leisure and Travel Stocks
Several trends and opportunities are shaping the future of the leisure and travel sector:
● Market Growth: India's tourism market is projected to be worth US$125 billion by FY 2026-27, driven by improved infrastructure, global connectivity, and higher disposable incomes.
● Digital Transformation: The rise of online travel agencies and digital booking platforms presents investment opportunities in tech-driven travel solutions. Companies like EaseMyTrip exemplify this trend.
● Niche Tourism: The development of niche tourism products, such as eco-tourism and adventure tourism, caters to diverse consumer preferences, offering new avenues for investment.
Investors should conduct thorough research and consider their risk tolerance before investing in the leisure and travel sector.
What is the GDP Contribution of the Leisure and Travel Sector?
The leisure and travel sector significantly contributes to India's economy:
● National Level: In FY23, the tourism sector's contribution to GDP rebounded to the pre-pandemic level of 5%, highlighting its resilience and importance to the economy.
● Employment Generation: The sector created 7.6 crore jobs in FY23, underscoring its role as a major employment generator in the country.
What is the Future of Leisure and Travel Stocks?
The future of leisure and travel stocks in India appears promising:
● Market Expansion: India's tourism sector is projected to grow at a compound annual growth rate (CAGR) of 10.35% by 2029, indicating robust expansion and investment opportunities.
● Government Initiatives: The Union Budget 2025 has allocated ₹2,479.62 crores to the tourism sector, aiming to boost infrastructure and services, which is expected to positively impact related stocks.
● Emerging Trends: Trends such as 'bleisure' travel, eco-tourism, and luxury escapes are expected to define the future of travel in 2025, offering new avenues for growth within the sector.
Why is It Worth Buying Leisure and Travel Stocks Now?
Several factors make investing in leisure and travel stocks attractive currently:
● Strong Growth Projections: India's travel sector is expected to grow at a 6.9% CAGR, reaching US$ 512 billion by 2028, indicating substantial growth potential for investors.
● Government Support: The government's comprehensive approach aims to elevate the tourism sector's contribution to GDP to 9-12%, aligning with global peers, which could enhance the profitability of companies within this sector.
● Technological Integration: The adoption of advanced technologies is transforming the travel industry, leading to improved customer experiences and operational efficiencies, making it a favorable time to invest.
Conclusion
The leisure and travel sector plays a vital role in India's economy, contributing significantly to GDP and employment. With positive growth forecasts, supportive government initiatives, and emerging trends, investing in leisure and travel stocks presents promising opportunities. However, investors should conduct thorough research, utilize tools like a brokerage calculator to estimate costs, and consider their individual risk tolerance before making investment decisions. Opening a trading account and demat account is essential for participating in this sector, and staying informed about upcoming IPOs can provide additional investment avenues.
Other Popular Stocks in India
India's leisure and travel sector encompasses a variety of companies contributing to the industry's growth. Below are notable stocks in this sector:
1. DreamFolks Services Limited
DreamFolks is an Indian airport service aggregator established in 2013. It provides consumers access to airport-related services via a technology-driven platform. In August 2022, the company opened its initial public offering (IPO) and listed on BSE and NSE on 6 September 2022. As of October 2022, DreamFolks had 100% coverage across 54 airport lounges in India and a market share of over 95% of all India-issued card-based access to domestic lounges in India.
2. EaseMyTrip
EaseMyTrip is an Indian online travel company offering services like airline tickets, holiday packages, and hotel reservations. In March 2021, EaseMyTrip went public with an initial public offering. In September 2021, it became a unicorn after its market capitalization crossed $1 billion. The company has expanded its operations to international markets such as UAE, UK, US, Philippines, Singapore, and Thailand.
3. Sterling Holiday Resorts Limited
Sterling Holiday Resorts Limited, established in 1986, is a leading hospitality company in India. It owns and manages 52 resorts, hotels, and retreats across 47 destinations. Since 2014, Sterling has been an integral part of Fairfax Financial Holdings Ltd. and is a 100% independently managed subsidiary of Thomas Cook India Limited.
Investors interested in India's leisure and travel sector may consider these companies for their portfolios. It is advised to conduct thorough research and consult financial advisors before making investment decisions.