Buy Lemon Tree; target of Rs 86: Motilal Oswal

The research firm ICICI Securities believes earnings of apparel brands and retail companies under their coverage may surprise positively from Q3FY22E as the likely demand recovery may result in better than expected margin performance. Some of the costs savings achieved during pandemic may sustain and coupled with high operating leverage may lead to higher than pre-covid margins from Q3FY22E.  Stocks like Trent, V-Mart and Aditya Birla Fashion and Retail are the preferred picks backed by their strong and consistent track record of execution.

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26 Aug, 2025 12:21

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Motilal Oswal's research report on Lemon Tree

LEMONTRE is well placed to capitalize on the impending opportunity in the domestic Hospitality industry and the expected upcycle, due to: a) its strong presence in the mid-priced Hotel segment, (b) stabilization of hotels launched prior to the outbreak of the COVID-19 pandemic in greater demand and higher ARR markets, and c) an increase in the number of rooms through management contracts. Key risks to our call include: a) Another COVID wave can dampen business demand further and delay capex; b) Softening of room rates due to demand normalization; c) and return of cost to pre-COVID levels.

Outlook

We have a Buy rating on the stock with a SoTP-based TP of INR86 (assigning an 18x one-year forward EV/EBITDA multiple to FY24E EBITDA).

More Info

At 10:32 hrs Lemon Tree Hotels Ltd. was quoting at Rs 65.95, up Rs 0.25, or 0.38 percent.

It has touched an intraday high of Rs 66.40 and an intraday low of Rs 65.35.

It was trading with volumes of 61,004 shares, compared to its thirty day average of 303,320 shares, a decrease of -79.89 percent.

In the previous trading session, the share closed down 0.38 percent or Rs 0.25 at Rs 65.70.

The share touched its 52-week high Rs 71.40 and 52-week low Rs 36.10 on 03 June, 2022 and 11 August, 2021, respectively.

Currently, it is trading 7.63 percent below its 52-week high and 82.69 percent above its 52-week low.

Market capitalisation stands at Rs 5,224.87 crore.

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Lemon Tree - 120722 - moti