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Shares of hospitality companies, including Indian Hotels Company Ltd (IHCL), EIH Ltd, Chalet Hotels, Lemon Tree Hotels, Samhi Hotels, and Juniper Hotels, declined by over 3% on Monday, 11 May.
The fall followed Narendra Modi's urging citizens to reconsider the rising trend of overseas weddings, vacations, and leisure travel. He called for a temporary pause on foreign trips for at least a year amid the ongoing global crisis.
Emphasising national responsibility during challenging times, the Prime Minister encouraged people to prioritise domestic travel and support the local economy.
Hotel stocks, including Chalet Hotels and Lemon Tree Hotels, dropped up to 3% following Prime Minister Modi's appeal for citizens to reconsider overseas weddings, vacations, and leisure travel for at least a year.
PM Modi urged citizens to pause foreign trips for at least a year, prioritize domestic travel, and support the local economy to conserve foreign exchange reserves and ease pressure on the country's reserves.
The appeal to limit overseas travel and prioritize domestic tourism can aid hotels, airlines, transportation providers, tour companies, and local enterprises, highlighting the travel sector's contribution to India's economy.
Besides avoiding foreign travel, PM Modi appealed to citizens to work from home where possible, avoid buying gold for a year, reduce petrol and diesel consumption, cut down cooking oil use, and use fewer foreign products.
Jewelry stocks, including Titan and Kalyan Jewellers, crashed up to 12% after PM Modi urged citizens to postpone gold purchases for weddings for at least a year to save foreign exchange.
While addressing a public gathering at Parade Ground in Hyderabad, Narendra Modi urged citizens to adopt what he described as a “national responsibility”–driven lifestyle to help the country navigate challenges such as inflation, supply chain disruptions, and rising energy costs.
As part of this appeal, he called on Indians to limit overseas vacations and avoid destination weddings abroad for at least a year, highlighting the need to ease pressure on the country’s foreign exchange reserves. He emphasised that conserving foreign exchange during uncertain global conditions is an act of patriotism and encouraged people to prioritise locally made products over imports wherever possible.
The comments come at a time when the demand for outbound travel from India is robust, particularly during the peak holiday period, with various destinations in Southeast Asia, the Gulf region, and Europe continuing to draw Indian tourists. Nevertheless, geopolitical conflicts and rising fuel costs have raised concerns about volatile and higher airfares.
Given India's significant dependence on crude oil imports, any rise in global oil prices directly affects the cost of aviation fuel, which in turn leads to higher airfares and overall travel expenditures. This situation makes both international and domestic journeys pricier.
In addition to its immediate effects, the Prime Minister’s call could lead to wider repercussions for the travel sector. A pivot towards domestic tourism would aid hotels, airlines, transportation providers, tour companies, and local enterprises, emphasising the sector’s significance as an important contributor to India's economy.
Prime Minister Modi delivered this address amid growing concerns about energy security and economic stability, driven by ongoing geopolitical conflicts that have affected fuel prices and global commerce. For Indian travellers considering their summer holidays overseas, the Prime Minister's remarks underscore the growing concerns about rising energy costs, foreign exchange outflows, and the resilience of the domestic economy.
Anshul Jain, Head of Research at Lakshmishree, said that among hotel stocks such as Indian Hotels Company Limited, Chalet Hotels, Lemon Tree Hotels, and Samhi Hotels, Indian Hotels appears to be the strongest on technical charts.
He noted that the stock has witnessed a swing structure breakout, indicating the continuation of the broader uptrend and improving relative strength within the sector. Price action suggests steady accumulation, with the structure pointing towards a potential move to the ₹720 zone in the coming weeks.
Jain added that daily moving averages are nearing a bullish crossover and are now acting as a dynamic support base, reinforcing upward momentum. Any pullback towards the EMA cluster is likely to be viewed as a buying opportunity, supporting the case for a sustained upmove.
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