NIFTY23,4060.33%
SENSEX74,3460.41%
BANKNIFTY54,1860.88%
NIFTY IT29,3845.57%
PHARMA24,0870.33%
AUTO26,0930.05%
FMCG48,1241.01%
METAL13,5350.17%
REALTY762.601.39%
ENERGY40,1970.02%
NIFTY23,4060.33%
SENSEX74,3460.41%
BANKNIFTY54,1860.88%
NIFTY IT29,3845.57%
PHARMA24,0870.33%
AUTO26,0930.05%
FMCG48,1241.01%
METAL13,5350.17%
REALTY762.601.39%
ENERGY40,1970.02%

Commercial LPG Shortage Disrupts Hotel Operations in India

Key Highlights

  • The ongoing Iran war has disrupted liquefied petroleum gas (LPG) shipments from West Asia, impacting commercial gas supplies in India.
  • Hoteliers are receiving only 10-20 percent of their LPG requirement, with unpredictable supply deliveries and delayed shipments.
  • The shortage has forced hotels to tweak menus, slow down laundry cycles, and explore alternative cooking methods.

Impact on Hotel Operations

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Hotel operations are being severely impacted by the LPG shortage, with many hotel chains forced to adjust their menus and kitchen operations. According to Pradeep Shetty, Vice President of the Federation of Hotel & Restaurant Associations of India (FHRAI), hotels are receiving only 10-20 percent of their LPG requirement, with little clarity on when regular supplies will resume.

Menu Makeover

Hotels are reshaping their menus to ensure uninterrupted service, focusing on items that require less fuel or can be cooked on alternative systems. Harshal Dilwali, Director & CEO at Clarissa Group, said that the company is prioritizing items such as idli, medu vada, poha, and similar snacks that are quicker and fuel-efficient.

Alternative Cooking Methods

Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline

Hotels are exploring alternative cooking methods, including tandoor-based preparations, traditional cooking methods, and electric cooking equipment. Arjun Baljee, Founder of ICONIQA and President of Royal Orchid Hotels, said that the industry is gradually adopting induction cooking, infrared burners, and electric cooking equipment to reduce dependence on LPG.

Industry Impact

The shortage is being felt across the hospitality market, with 80 percent of hotels in the country expected to be affected if the situation does not improve quickly. Sandeep Basu, CEO of OPO Hotels & Resorts, said that the company collectively prepares between 1,500 to 3,000 meals daily, including restaurant dining, in-room dining, banquets, and staff meals.

Supply Chain Disruptions

The shortage has left hotel operators scrambling to secure cooking gas, with many relying on alternative suppliers and exploring new technologies to reduce dependence on LPG. Anoop Vijayaraj, GM of Kairali The Ayurvedic Healing Village, Palakkad, is depending on dry woods during this critical situation.

Timeline

  • The Iran war has disrupted LPG shipments from West Asia, impacting commercial gas supplies in India.
  • Hoteliers are receiving only 10-20 percent of their LPG requirement, with unpredictable supply deliveries and delayed shipments.
  • The shortage is expected to impact 80 percent of hotels in the country if the situation does not improve quickly.

Investor Takeaway

Investors should be aware of potential supply chain disruptions in the FMCG sector due to global events.

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