Hotels' New Year's Eve revenue to fall 50 per cent

This is one New Year when most citizens will not be comfortable partying following the terrorist attacks that left hundreds dead.

Taking a cue, major hotels in Mumbai, like the JW Marriott at Juhu and the Renaissance Mumbai Hotel & Convention Centre at Powai, have called off their New Year's Eve bashes. Others like the Four Seasons, which opened in September, are undecided.

"Large venues (close to 40 per cent) in Mumbai have cancelled their plans to host big-ticket events," said Manuj Agarwal, chief operations officer, Percept Group's events company.

Consequently, it is estimated that revenues from food and beverage and alcohol will drop by up to 50 per cent on New Year's Eve, since the celebrations on that day alone account for around 8 per cent of the overall industry's annual alcohol consumption.

The alcohol market in India for beer, wine and spirits is estimated at 500 million cases a year.

Most hoteliers are expected to have low-key affairs, even if they organise the parties, owing to security concerns and in deference to the sentiments of Mumbaikars, many of whom have lost their relatives and close friends.

"Revenues from New Year's revelry account for 10-25 per cent of the entire month's revenue and there would be a drop of 40 per cent in the revenue as hotels go low-key on celebrations this year," said the general manager of one of the leading hotels in south Mumbai.

The hotel industry is already suffering from weak demand due to the global economic recession, and the recent spate of terrorist attacks on the Taj, the Trident and the Oberoi in Mumbai have only added to its woes.