Tourism, Hotel, travel and airline stocks are buzzing in trade in Monday’s session. Indian Hotels, Chalet Hotels, Lemon Tree Hotel shares have surged more than 5% in early deals. Airline stocks like SpiceJet also rose over 4% on the BSE as airlines are now allowed to operate domestic flights at a maximum of 85% of their pre-Covid capacity from 72.5% earlier.
Analysts said that such travel related stocks have been surging on the back of reopening momentum in India furthermore aviation companies are allowed to operate with 85% capacity.
“Indian may open the doors for foreign tourist soon is another big reason for a sharp rally in hotel stocks. The overall outlook for the travel and tourism sector is very bullish on the back of changing lifestyle, government support, and attractive valuations, therefore, investors can look for investment opportunities in this space but in the near term, we could see some correction in this space as well along with the overall market as there are some global cues,” said Santosh Meena, Head of Research, Swastika Investmart.
Meena said that Indian hotel will remain their top pick in the hotel space due to its strong pedigree and business. He also expects that IndiGo may continue to outperform because the airline stock may remain institutional investors’ favorite pick due to its leadership in the space.
IndiGo’s parent InterGlobe Aviation shares shot up to a new high in Friday’s session as he gradual lifting of restrictions and rising pace of vaccinations have driven up domestic air passenger traffic, which could act as a key trigger for the airline stocks.
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