Lemon Tree Hotels hits record high after company signs two new properties

Lemon Tree Hotels share price: Shares of Lemon Tree Hotels hit an all-time high of Rs 125.50 apiece on the BSE on Friday, September 15, after the company announced on Thursday that it has signed two new properties: Lemon Tree Hotel, Junagadh, Gujarat, India, and Tigerland Safari: A Lemon Tree Resort, Chitwan, Nepal. However, the stock erased all its gains later and ended nearly a per cent lower at Rs 121.65 on the BSE.

The former is expected to be operational by FY 2025, and the latter is expected to be operational in FY 2024 itself, the company said in its press release.

Lemon Tree Hotel, Junagadh, will feature 64 well-appointed rooms, a restaurant, a banquet hall, a meeting room, and other public areas.

Tigerland Safari – A Lemon Tree Resort, Chitwan, Nepal, will feature 35 well-appointed rooms, one restaurant, a banquet hall, meeting rooms, and other public areas. The Bharatpur Airport, Nepal, is about 22 km from the property, it added.

ABOUT LEMON TREE HOTELS LIMITED

Lemon Tree Hotels Limited (LTHL) is one of the leading hotel chains in India. LTHL operates across the upscale, upper-midscale, midscale and economy segments.

LTHL opened its first hotel with 49 rooms in May 2004 and currently operates nearly 8,600 rooms in 92 hotels across 58 destinations. When the current pipeline becomes operational, LTHL will be operating nearly 12,800 rooms in 146 hotels across 93 destinations, the company said in its press release.

The group offers seven brands to meet guests’ needs across all levels, viz. Aurika Hotels & Resorts, Lemon Tree Premier, Lemon Tree Hotels, Red Fox Hotels by Lemon Tree Hotels, Keys Prima by Lemon Tree Hotels, Keys Select by Lemon Tree Hotels and Keys Lite by Lemon Tree Hotels.

What brokerages say 

Recently, Prabhudas Lilladher initiated coverage on Lemon Tree Hotels with a 'BUY' rating and a target price of Rs 140. In its report, the brokerage said, "We believe LTHL is well poised to capitalise from an impending uptick in the Indian hospitality industry given 

1) a leadership position in the mid-scale/economy segment with nearly 19 per cent market share;
2) aggressive plans to rapidly expand via asset-light management contract route that is expected to improve BS strength and uplift margin profile and;
3) operationalisation of Aurika Hotel in Mumbai with 669 rooms. 

Aurika is expected to be a crown jewel for LTHL as it is strategically located in the dense micro-market of Mumbai (near the airport) and we expect the hotel to generate revenues of Rs 2,76 4 million in FY26E (2nd full year of operations with an EBITDA margin of 60 per cent)," it said.