Lemon Tree Hotels share price: Horwath report highlights of India's largest chain in mid-priced hotels sector and third largest overall

Lemon Tree Hotels is India's largest chain in the mid-priced hotels sector and third largest overall, as of June 30, 2017, according to the Horwath Report. This award winning Indian hotel chain opened its first hotel with 49 rooms in May 2004 and operates 84 hotels in 51 destinations with 8100 rooms and over 8300 employees. Lemon Tree Hotels share price today is Rs 43.75, up Rs 1.1 or 2.6%,

Lemon Tree Hotels has posted strong sequential recovery in growth in Q3 FY21 to Rs 68.4 cr as revenues increased by 44% qoq driven by improvement in occupancy to 42.4% from 32.4% in Q2FY21. However ARR declined by 4.7% qoq as a result of which REVPAR grew by 24.9% qoq. During Q3Fy21 the company has witnessed recovery in demand every month with occupancy levels touching 50.3% in Dec’1 as compared to 33.3% in Sep’21.

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Lemon Tree posted a positive EBIDTA for the quarter at Rs 20.3 cr which was down by 75.3% yoy but was up 142% qoq. Angel Broking expects demand will continue to recover for Lemon Tree hotel given that they are more dependent upon domestic tourists rather than international tourists. Given continued recovery in demand led by pick up in domestic tourist and corporate travel we expect normalization of operations by H2FY22. Hence Angel Broking recommends a BUY on Lemon Tree Hotels.

Ajit Mishra, VP - Research, Religare Broking Markets took a breather after the recent surge and settled with a cut of over a percent. Weak global cues triggered a gap-down start, followed by volatile swings till the end. Consequently, the Nifty ended lower, down by 1.1% at 15081 levels. On the flip side, resilience on the broader front kept the participants busy. Excessive volatility in the global markets, mainly due to the rise in the bond yields, impacting sentiment on the domestic front too and we don’t expect any relief from that front anytime soon. Religare Broking reiterates cautiously optimistic views on markets and suggests preferring hedged positions instead of outrights.