Travel & Tourism – Apr-Jan’26 Earnings Preview – Smooth check-ins, turbulent take-offs
Published on 09 Jul 2026
Demand environment remained mixed during Q1FY27E, with geopolitical tensions in West Asia continuing to weigh on travel sentiment, particularly inbound tourism and discretionary travel. Domestic aviation traffic remained subdued (3% growth in first 2 months of Q1FY27E), reflecting softer demand, while elevated ATF price and forex volatility will weigh on profitability of airlines. In contrast, the hospitality sector’s performance is expected to be better aided by a favorable wedding calendar (24 auspicious wedding days) and a low base (May’25 was impacted by Operation Sindoor and early onset of monsoon). Meanwhile, the luggage sector continued to face pressure from sharp inflation in key raw materials such as PP, PC, nylon and polyester following the spike in crude prices. We expect earnings in the aviation and luggage sectors to be impacted by cost inflation, while hospitality sector is likely to deliver resilient performance supported by healthy domestic demand. SAMHI IN and SII IN remain our top picks in the travel & tourism space.
