Buy Lemon Tree Hotels; target of Rs 158 Prabhudas Lilladher

Prabhudas Lilladher is bullish on Lemon Tree Hotels has recommended buy rating on the stock with a target price of Rs 158 in its research report dated November 18, 2024.

Broker Research

November 19, 2024 / 12:16 IST

Buy

26 Aug, 2025 12:21

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Prabhudas Lilladher's research report on Lemon Tree Hotels

Despite the ongoing renovation exercise, Lemon Tree Hotel Ltd’s (LTHL) operational performance was better than our estimate with EBITDA margin of 46.0% (PLe 44.6%) led by better cost control and 3% beat on the revenue front. While Aurika, MIAL’s occupancy stood at 50%+ in 2QFY25, management expects sharp recovery in 2HFY25 with EBITDA margin of 60%+. In addition, as renovation exercise is typically a 1H phenomenon, we expect the overall operational performance to improve in 2HFY25E. Led by stabilization of Aurika, MIAL and improvement in RevPAR amid the ongoing renovation exercise we expect revenue/EBITDA CAGR of 11%/21% over FY25E-FY27E.

Outlook

LTHL trades at EV/EBITDA multiple of 13.7x/11.9x over our FY26E/FY27E estimates, unadjusted for the minority interest in Fleur. We broadly maintain our estimates and retain BUY with a TP of Rs158 (24x FY26E EBITDA; no change in target multiple).

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