US-Iran war puts tourism stocks under pressure

The US-Iran war could weigh on tourism-related stocks, as rising crude oil prices push up operating costs and security concerns dampen travel.

- Srushti Vaidya

While airlines are likely to be the most vulnerable due to higher fuel expenses, hotels and medical tourism players could face near-term pressure from softer bookings and more cautious consumer behaviour.

“Airline stocks will face a double whammy of rising crude oil prices and weaker travel demand. While higher fuel costs directly hurt margins, geopolitical uncertainty leads to flight cancellations, lower passenger traffic, and reduced seat occupancy as travellers defer or cancel plans,” said Siddharth Bhamre, head of institutional research at brokerage Asit C Mehta Institutional Equities.