Mauritius’ hospitality industry is thriving, with high occupancies and strong margins but is it truly future-proof? Our latest Hospitality Industry Report explores the structural constraints, growth risks, and strategic levers needed to unlock sustainable, productivity-driven expansion.
Mauritius accommodated a record 1.44M tourists in 2025, with record tourism earnings of Rs 103.4Bn.
EUR 121 per day in 2025
To compare purchasing power accurately over time, we calculate these figures in Real EUR – meaning they are adjusted for inflation to represent a constant value. By this measure, daily tourist spending has remained stagnant for the past 30 years. While the long-term average is approximately EUR 139 per day, current spending has dropped to EUR 121, which is significantly below the historical norm. But it is in line with the decrease in World Average RpVD.
Unprofitable Shift towards premiumization
Despite constant real spending, Mauritius hotel industry has shifted towards premiumization, with 4+ Star hotels accounting for more than 85% of hotel room supply
Accommodation costs rising from 52% to nearly 73%
Real RpVD stayed stable. The average tourist’s spending behavior changed drastically, with accommodation costs rising from 52% of their budget in 2000 to nearly 73% in 2024, signaling that hotels are capturing most of the value in the tourism ecosystem.
Mauritius is operating in a mid-market tourism reality
We believe that Maldives and Seychelles are not our direct competitors. Their real spending power and hotel quality operate in a different value segment entirely. Our Real RpV remains similar to World Average. In fact, Sri Lanka is a more appropriate comparative peer for Mauritius.
We did a comprehensive case study on Sri Lanka (which managed to double its RpV and increase its total arrivals) and concluded that cheaper Airfares, different Spending Patterns, increased Investment.
More rooms supply needed
Short-term solution
We believe the Non-Hotel sector is under-monetized but holds superior economic leverage due to length of stay. While non-hotel tourists spend less per day, they stay twice as long as hotel guests (15.0 nights vs. 9.1 nights). We estimate that every Rupee added to their daily expenditure has a 2x multiplier effect on total receipts compared to a hotel guest.
45.6% compared to 84.0%
The non-hotel sector operates at just 45.6% of occupation, compared to 84.0% for hotels, implying a massive dormant asset capacity that can be activated without further CAPEX.
Our analysis indicates that increasing non-hotel inventory by just 10% (813 rooms) and improving RpV by 5% (Rs 140/day), would unlock Rs 2.1Bn in additional annual revenue.
Long-term solution
Additionally, to increase capacity for our hotels as a longer-term solution. Mauritius remains primed for investment with a strong EUR and high occupancy rates.
Premiumization Trap
Between 2008 and 2019, we believe the industry fell into a premiumization trap, where operating costs surged to support luxury inventory, compressing margins to an unsustainable 11%.
Debt levels increased – gearing surged from 64.5% pre-2007 to 106.9% prior to 2019.
Profit boosted by Rupee Depreciation
Post-COVID, We partly attribute the current record profitability to the following currency tailwinds (EUR: +26.7%, USD: +29.7%, GBP: +31.4%) between 2019 and 2024.
-8.9% fewer staff than in 2019
Hotels have lowered their break-even points by operating with -8.9% fewer staff than in 2019.
MIC’s low interest lifeline
MIC disbursed around Rs 17Bn in Convertible Debt with a low fixed rate of around 3%-4%, of which the hospitality sector benefitted around Rs 13.1Bn.
The low fixed interest rates benefitted hotelswhen major central banks across the globe (including Bank of Mauritius) hiked rates in 2022 and 2023.