Kerala leaves Maharashtra, Gujarat behind in number of luxury hotels

Kerala has emerged as the unrivalled leader in India's luxury hospitality sector, surpassing all other states in the number of high-end hotels, according to the latest statistics from the Union Ministry of Tourism. Despite a drop in tourist arrivals, the southern state has consolidated its position as the country's top destination for luxury accommodation, outpacing Maharashtra and Gujarat by a significant margin.
Official figures reveal that Kerala boasts 94 five-star hotels, leading the country in the top-tier category. The state also ranks first in both the four-star and three-star segments, with 420 and 607 establishments respectively. This dominance marks a significant gap between Kerala and Maharashtra, which holds second place with 86 five-star hotels, 36 four-star hotels, and 69 three-star properties. Gujarat, standing third, maintains 76 five-star hotels, 61 four-star hotels, and 120 three-star hotels.
Industry experts attribute Kerala’s commanding lead to its proactive policies in promoting high-end tourism, its globally recognised wellness offerings, and the strategic support given to the hospitality sector by state authorities. The state’s emphasis on ayurvedic wellness tourism, backwater cruises, and eco-friendly resorts has fostered a robust luxury market that appeals to both domestic and international travellers seeking bespoke experiences.
Suvendu Pillai, a senior analyst at the Federation of Hotel and Restaurant Associations of India, stated that Kerala’s strong growth reflects deliberate government efforts to expand quality infrastructure beyond traditional tourist hotspots. “Kerala’s approach has been methodical. While destinations like Kovalam and Kumarakom continue to attract attention, newer luxury projects are being developed in lesser-known areas like Wayanad and Bekal, offering a wide array of experiences,” he said.
Developments in Kerala’s hospitality landscape have also been spurred by investment incentives and partnerships with leading international hotel chains. Groups such as Marriott International, Hyatt Hotels Corporation, and Taj Hotels have expanded their presence, capitalising on the state's consistent demand for premium accommodations. According to a senior executive at Marriott India, Kerala’s diversified tourism products – ranging from houseboat stays to plantation retreats – make it an attractive destination for luxury travellers, and thus a priority for expansion.
Another critical factor behind Kerala’s edge is its robust domestic tourism. While international tourist numbers have yet to return fully to pre-pandemic levels, domestic tourists have largely filled the gap, sustaining occupancy rates at luxury properties. According to data from the Kerala Tourism Department, the state welcomed over 20 million domestic tourists in the past year, with luxury hotel bookings seeing a steady upward trend.
Maharashtra, traditionally a strong competitor, has seen slower growth in luxury hotels outside metropolitan hubs like Mumbai and Pune. Analysts suggest that while Mumbai maintains a dense concentration of high-end properties, the lack of luxury hotel developments in other parts of the state has widened the gap with Kerala. Meanwhile, Gujarat’s growth has been commendable but remains concentrated around major urban and industrial centres like Ahmedabad and Surat.
Kerala’s leadership in the luxury hotel sector is particularly notable given that it does not house the large financial centres or tech hubs that typically drive premium hospitality demand in other states. Instead, the state has built its brand around sustainable and experiential tourism, blending natural beauty with cultural authenticity. This model has allowed luxury hotel operators to target niche markets, from wellness retreats to culinary tourism. Open URL