Lemon Tree Hotels Ltd share Price

Promoted by Mr. Patanjali Keswani, Lemon Tree is the largest hotel chain in the mid-priced segment in India. It operates 8,489 rooms in 87 hotels across 54 destinations in India and abroad under brands like Aurika (premium), Lemon Tree premier, Lemon Tree (midscale), RedFox (economy) and Keys.

• The favourable location of its properties in prominent business and tourist districts supports revenue growth prospects and reduces concentration risk
• Post completion of expansion, LTHL will be operating ~10,462 rooms in 105 hotels across 64 destinations, in India and abroad by FY24E

Lemon tree’s operational performance were weak during Q4FY22 that was largely impacted by omicron wave.

• Revenues declined 16.8% QoQ to ₹119.5 crore (vs I-direct est: ₹136.1 crore). It was up 25.7% on YoY basis
• Operating expenses were higher 47.2% YoY to ₹97.9 crore as it included one-time charge of ₹15.3 crore towards stamp duty for amalgamation of three companies into its key subsidiary.
• As a result, EBITDA margins declined 1190bps YoY to 18.1%. Further, higher interest cost led to net loss of ₹39.2 crore vs loss of ₹26.7 crore LY

Q4FY23 Quarterly Result Announced for Lemon Tree Hotels Ltd.

Lemon Tree Hotels announced Q4FY23 results:

• Revenue from operations stood at Rs 252.7 crore in Q4FY23 which was up 8.2% from Rs 233.5 crore in Q3FY23 and was up 43.5% as compared to Rs 176.1 crore in Q4FY20
• Gross ARR stood at Rs 5,824 in Q4FY23 which was up 2% from Rs 5,738 in Q3FY23 and was up 29% as compared to Rs 4,530 crore in Q4FY20
• Occupancy% stood at 73.6% in Q4FY23 which was up 604 bps from 67.6% in Q3FY23 and was up 1,259 bps as compared to 61.0% in Q4FY20
• Total expenses stood at Rs 112.8 crore in Q4FY23 which was up 5.3% from Rs 107.1 crore in Q3FY23 and was up 0.5% as compared to Rs 112.2 crore in Q4FY20
• Net EBITDA stood at Rs 141.9 crore in Q4FY23 which was up 11.7% from Rs 127.0 crore in Q3FY23 and was up 120.5% as compared to Rs 64.4 crore in Q4FY20
• Net EBITDA margin % stood at 55.7% in Q4FY23 which was up 146 bps from 54.3% in Q3FY23 and was up 1,926 bps as compared to 36.5% in Q4FY20
• PAT stood at Rs 59.0 crore in Q4FY23 which was up 21.5% from Rs 48.6 crore in Q3FY23 and was up Rs 78.0 crore as compared to Rs (19.0) crore in Q4FY20
• Cash Profit stood at Rs 82.5 crore in Q4FY23 which was up 14.4% from Rs 72.1 crore in Q3FY23 and was up 845.2% as compared to Rs 8.7 crore in Q4FY20

Commenting on the performance for Q4FY23, Patanjali Keswani, Chairman & Managing Director – Lemon Tree Hotels said, “FY23 has been the best year for Lemon Tree Hotels. As anticipated and in line with our initial guidance, we have more than doubled our total revenue vs FY22 and have maintained more than 50% EBITDA margin for the full year. In FY23 our total revenue increased by 111% vs FY22 to Rs 879 Cr. with an EBITDA margin of 51.9%.

Q4FY23 was the best quarter to date, with growth across all metrics. As I had mentioned in the last earnings call, after increasing our ARR by 17% in Q3 vs Q2 FY23, in Q4 we focused on building up occupancy which increased by 604 bps vs Q3FY23 and by 1,259 bps vs Q4FY20. Gross ARR stood at Rs 5,824 which increased by 2% vs Q3FY23 and by 29% vs Q4FY20. This translated into an improved RevPAR of Rs 4,287 which increased by 11% vs Q3FY23 and by 55% vs Q4FY20. In Q4FY23, Lemon Tree Hotel’s RevPAR grew 55% whereas the branded hotel industry grew 41% vs Q4FY20.

The net EBITDA margin for the company in Q4FY23 was industry-leading at 55.7% which increased by 146 bps vs Q3FY23 and by 1,926 bps vs Q4FY20. The PAT for Q4FY23 stood at Rs 59 Cr, which increased by 22% vs Q3FY23. In Q4FY20, we had a negative PAT of Rs 19 Cr. Our cash profit stood at Rs 82.5 crore which increased by 14% vs Q3FY23 and by 845% vs Q4FY20.
As of 31st March 2023, our gross debt stood at Rs 1,746 crore and the average cost of borrowings stood at 9.08% while the weighted average cost of borrowing for the full year was 8.38%.

During the quarter we signed 9 new management & franchise contracts which add 538 new rooms to our pipeline. As of 31st March 2023, our operational inventory comprised 88 hotels with 8,382 rooms and our pipeline comprised 42 hotels with 3,285 rooms.

For FY24, I will refrain from giving any specific guidance other than saying that our growth momentum continues and that we will be investing significantly more than normal in renovating our hotels, especially the Keys portfolio, to catch up with the near absence of this during FY21 and FY22. This will increase our operating expenses by a further 2 to 2.5% on a revenue basis for this year, but will position our hotels to capture better pricing and demand in H2 and in the following years.

Finally, post-CoVID and with the impending opening of our largest hotel, Aurika Sky City Mumbai, we would now like to share the roadmap for the next five years which has been released alongside the earnings presentation where we have set forth clear and achievable outcomes for the next 5 years.”

Result PDF