Lemon Tree trades lower, investors unimpressed by strong Q1 numbers

Lemon Tree Hotels has a managed and franchisee pipeline of 2986 rooms commissioned for 2025.

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Lemon Tree Hotels shares opened flat at Rs 95.20 despite the hotel chain doubling consolidated net profit in the June quarter at Rs 27.5 crore from the year-ago period.

Consolidated revenue increased 16.8 percent YoY to Rs 226.4 crore, and earnings before interest, taxes, depreciation and amortization were up 15 percent at Rs 106.8 crore.

Lemon Tree Hotels’ occupancy levels increased 514 basis points to 70.2 percent YoY but were sequentially down 339 basis points. One basis point is one-hundredth of a percentage point.

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Lemon Tree Hotels said it outperformed the industry in some cities in terms of Revenue Per Room (RevPar. Industry RevPar growth in Q1FY24 YoY in Mumbai was 14 percent, while for Lemon Tree Hotels it was at 26 percent. In Gurugram, the industry RevPar was 14 percent and Lemon Tree Hotels' 28 percent. However, in New Delhi, Hyderabad, and Bengaluru it underperformed the industry.

Lemon Tree Hotels has a managed and franchisee pipeline of 2,986 rooms commissioned for 2025.

“During the quarter we signed six new management and franchise contracts which adds 548 new rooms to our pipeline,” the company said in its investor presentation.

At 10.14 am, the stock was trading at Rs 94.85 on the National Stock Exchange, down 0.84 percent from the previous close.

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