This stock is a leading Indian hotel chain, known for being the largest in the mid-priced segment and the third largest overall in the country. The stock has jumped to an intraday high of 2.76 percent after signing a license agreement for a new hotel in Ranchi and opening a resort in Bhutan.
Stock Price Movement:
With a market capitalization of Rs. 11,546.99 crores, the share of Lemon Tree Hotels Limited has reached an intraday high of Rs. 150.65 per equity share, rising nearly around 2.76 percent from its previous day’s close price of Rs. 146.60. Over the last months, Lemon Tree Hotels Limited has given a return of 23.38 percent.
What Happened:
Lemon Tree Hotels Limited has signed a license agreement for a new Lemon Tree Hotel in Ranchi, Jharkhand. The hotel is managed by its subsidiary Carnation Hotels and will feature 65 rooms and various amenities. It is expected to open in FY 2027.
Additionally, the company has also officially opened the Lemon Tree Resort in Thimphu, Bhutan, marking its second property in the region. The resort features 60 rooms, a villa, Citrus Café, and Slounge. Phase I, with 48 rooms and a villa, is open, while Phase II will include additional amenities like a fitness center, pool, and spa.
Management Guidance:
Lemon Tree Hotels anticipates an annual EBITDA of Rs. 125 crore from renovated properties, expecting 15%-20% revenue growth after stabilization. The company plans to attract new corporate clients and expand its retail business in Aurika Mumbai, aiming for a balanced mix of corporate and retail room bookings.
Future Strategy:
Lemon Tree Hotels projects a revenue growth of over 15% for Q3 and Q4. The company plans to invest Rs. 250-300 crore in renovations through FY26, with expenses stabilizing at 1.5%-1.6% of revenue.
Additionally, 19 new management and franchise contracts have been signed, adding 1,373 rooms to the pipeline
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Brand:
Lemon Tree Hotels operates a wide range of brands, including Aurika Hotels and Resorts, Lemon Tree Premier, Lemon Tree Hotels, Red Fox by Lemon Tree Hotels, Keys Prima, Keys Select, and Keys Lite, catering to various customer needs from luxury to budget accommodations.
Recent quarter results:
Lemon Tree Hotels Limited’s revenue has increased from Rs. 227 crore in Q2 FY24 to Rs. 284 crore in Q2 FY25, which has grown by 25.11 percent. The net profit of Lemon Tree Hotels Limited has also grown by 34.61 percent, from Rs. 26 crore in Q2 FY24 to Rs. 35 crore in Q2 FY25.
Financial Ratio:
Lemon Tree Hotels Limited’s revenue and net profit have grown at a CAGR of 14.26 percent and 26.58 percent, respectively, over the last five years.
In terms of return ratios, the company’s ROCE and ROE should be 11.4 percent and 16.3 percent, respectively. The debt-to-equity ratio of the company is to be 2.23x. Lemon Tree Hotels Limited’s EPS is to be Rs. 1.92.
Company Overview:
Lemon Tree Hotels Limited was founded in 2002 and is India’s largest mid-priced hotel chain and the third largest overall. It operates more than 100 hotels with approximately 9,700 rooms across 64 cities, providing affordable yet superior services in the mid-scale and upscale hotel segments.
Written By – Nikhil Naik
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