Buyers flock to hotel counters

HOTEL stocks glittered among the second-line companies yesterday, with two counters gracing the top 10 performers' list.

Shangri-La Asia rose 40 cents, or 3.64 per cent, to $11.40 as the day's ninth biggest gainer. A total of 968,000 shares equivalent to $10.99 million changed hands.

Mandarin Oriental rose 35 cents or 3.4 per cent to $10.65 as the day's 10th biggest gainer. It posted a volume of 1.04 million shares worth $11.06 million.

The outlook for the hotel industry has picked up recently, with the number of visitors to the territory projected to exceed 10 million, up 16 per cent, by the year's end.

The demolition of a number of hotels has also strained supply, which is expected to raise occupancy rates of existing hotels.

Higher occupancies will give hoteliers a chance to raise their room rates.

An improved global economic environment will also promote more business travel and vacation trips, analysts believe.

Shangri-La Asia has pledged to push ahead with its interests in further hotel and property development in China.

The company is involved in mainland projects such as the Changchun Shangri-La, Shenyang Traders and the Beihai Shangri-La and is considering involvement in other mainland projects such as the $187.2 million Nanning International Hotel in Guangxi.

Locally, the Island Shangri-La was judged the world's best hotel last year by Executive Travel.

However, a recent poll by Asiamoney has Mandarin Oriental ranked first in Hong Kong.

American Express card holders also voted it as the ''best hotel in the world'' and the ''best business hotel''.

The Mandarin Oriental Hotel group recently took a 25 per cent interest in a hotel in Malaysia for US$20 million.