Lemon Tree Hotels , a leading mid-market hotel chain in India, has reported its highest-ever Q1 revenue of Rs 317.40 crore, marking an 18% year-over-year growth. The company's strong performance comes amid plans for significant restructuring and expansion.

Financial Highlights

• Net EBITDA increased by 23% to Rs 142.00 crore, with margins expanding to 44.8%.
• Gross Average Room Rate (ARR) rose by 10% to Rs 6,236.
• Occupancy improved by 591 basis points to 72.5%.
• Revenue Per Available Room (RevPAR) grew by 19% to Rs 4,523.
• Profit after tax surged by 139% to Rs 48.10 crore.

Debt Reduction and Cost Management

Lemon Tree Hotels has made significant strides in improving its financial position:

• Reduced debt by Rs 206.00 crore to Rs 1,658.00 crore.
• Lowered borrowing costs to 8.01%.
• Decreased power and fuel costs from 8.7% to 6.9% of revenue, despite a 6.9% increase in occupancy.

Strategic Restructuring

The company announced plans for a potential demerger scheme to transfer assets from Lemon Tree to its subsidiary, Fleur Hotels. This restructuring aims to:

• Make Lemon Tree an asset-light entity focused on management and branding.
• Position Fleur Hotels as the asset-heavy entity.
• List Fleur Hotels by the end of the next calendar year.

Expansion and Renovation

Lemon Tree Hotels continues to focus on growth and property improvement:

• Signed 14 new management contracts, adding 1,273 rooms to the pipeline.
• Operationalized 5 hotels with 400 rooms.
• Total inventory now stands at 226 hotels with 18,430 rooms.
• Investing heavily in renovations, with approximately 350 rooms currently under renovation.

Management Changes

The company announced key leadership changes:

• Neelendra will take over as CEO from October 1st.
• Founder Patanjali Keswani will transition to Executive Chairman.

Future Outlook

Patanjali Keswani, CMD of Lemon Tree Hotels, expressed confidence in the company's future, stating, "We are positioning both companies for very, very accelerated growth." He indicated that the company would exceed its previous target of 20,000 rooms in its 5-year plan, potentially reaching 30,000 to 40,000 rooms.

The company is also focusing on expanding its loyalty program, which currently has 2.1 million members, with plans to reach 3 million in the next year.

As Lemon Tree Hotels continues its transformation and expansion, investors and industry observers will be watching closely to see how these strategic moves shape the company's future in India's growing hospitality sector.

Lemon Tree Hotels , a prominent player in the Indian hospitality sector, has reported impressive financial results for the first quarter, showcasing robust growth across key metrics.

Profit Soars

The company's consolidated net profit witnessed a remarkable 93% year-over-year increase, reaching ₹383.00 million compared to ₹198.00 million in the same period last year. This substantial growth in profitability underscores Lemon Tree Hotels' effective cost management and operational efficiency.

Revenue Growth

Lemon Tree Hotels also reported a significant uptick in revenue, which grew to ₹3.16 billion from ₹2.70 billion in the corresponding quarter of the previous year. This 17% increase in revenue indicates strong demand for the company's hospitality services and successful expansion strategies.

Improved Operational Performance

The company's operational performance showed notable improvement, with EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) rising to ₹1.40 billion from ₹1.15 billion year-over-year. This represents a healthy 21.7% increase in EBITDA.

Enhanced Profitability Margins

Lemon Tree Hotels demonstrated enhanced profitability with an improvement in its EBITDA margin. The EBITDA margin expanded to 44.50% from 42.83% in the same quarter last year, reflecting the company's ability to optimize costs while growing its revenue.

Financial Highlights

The strong performance across all key financial metrics indicates Lemon Tree Hotels' resilience and ability to capitalize on the recovering hospitality sector. The company's substantial profit growth, coupled with improved operational efficiency, positions it well for continued success in the coming quarters.