HOTEL stocks bounced back over the past week from the previous week's dismal performance. Associated International Hotels rose 80 cents, or 12.9 per cent, to settle at its year-high of $7 yesterday. Miramar Hotel also did well with a gain of $1.80, or 10.47 per cent, on the week at $19. According to the latest report from DBS Investment Research, Associated Hotels has lagged behind the Hang Seng Index and most listed hotel counters this year. Associated Hotels shares weakened in July after the company announced slightly lower than expected results for the year ended March, as well as a $31 million investment in Malaysia. The unsatisfactory performance was attributed to the lack of investor understanding of the company and so it has been neglected in the bull run. Recently, there were signs that it was attracting increasing institutional interest. The share price has started to improve and the rerating of the stock is expected to continue. The DBS report also said the hotel sector was heading for a boom in the next two years with both room rates and occupancy levels expected to improve significantly as the territory faced a room shortage.