Lemon Tree Hotels Limited – Investor Presentation Summary

Key Operational Highlights

  • Total operational rooms: 12,131 across 138 hotels in 80+ cities
  • Gross ARR: ₹6,751 (+8% YoY)
  • Occupancy: 76.1% (+633 bps YoY)
  • RevPAR: ₹5,137 (+18% YoY)
  • Network revenue: ₹573 Cr (+23% YoY)
  • Key drivers: Strong demand recovery, market share gains, portfolio expansion, and operational efficiencies

Segment-wise Performance

Brand Performance (Owned/Leased Hotels):

  • Aurika Hotels & Resorts (808 rooms): RevPAR ₹7,300 (+17% YoY), EBITDAR margin 59% (+159 bps)
  • Lemon Tree Premier (1,523 rooms): RevPAR ₹6,716 (+18% YoY), EBITDAR margin 56% (-10 bps)
  • Lemon Tree Hotels (1,769 rooms): RevPAR ₹4,611 (+15% YoY), EBITDAR margin 46% (+73 bps)
  • Red Fox by Lemon Tree Hotels (643 rooms): RevPAR ₹2,945 (+21% YoY), EBITDAR margin 44% (-11 bps)
  • Keys by Lemon Tree Hotels (936 rooms): RevPAR ₹3,109 (+29% YoY), EBITDAR margin 50% (+748 bps)

Regional Performance (Owned/Leased Hotels):

  • Delhi (636 rooms): RevPAR ₹6,541 (+25% YoY), EBITDAR margin 52% (+122 bps)
  • Mumbai (972 rooms): RevPAR ₹7,270 (+11% YoY), EBITDAR margin 61% (-27 bps)
  • Bengaluru (874 rooms): RevPAR ₹4,362 (+23% YoY), EBITDAR margin 53% (+78 bps)
  • Hyderabad (663 rooms): RevPAR ₹6,288 (+16% YoY), EBITDAR margin 61% (+5 bps)
  • Rest of India (1,659 rooms): RevPAR ₹3,591 (+23% YoY), EBITDAR margin 42% (+393 bps)

Financial Highlights

Q2 FY27 Performance:

  • Revenue: ₹363.8 Cr (+18% YoY)
  • EBITDA: ₹162.2 Cr (+22% YoY)
  • PAT: ₹79.8 Cr (+90% YoY)
  • EPS: Not specified
  • Margins: EBITDA margin 44.6% (+157 bps YoY), PAT margin 21.9%
  • Like-for-like EBITDA (before GST impact and SAR provision): ₹173.7 Cr (+31% YoY), margin 47.7%

H1 FY27 Performance:

  • Revenue: ₹710.6 Cr (+14% YoY)
  • EBITDA: ₹314.0 Cr (+14% YoY)
  • PAT: ₹137.1 Cr (+52% YoY)
  • Cash Profit: ₹193.2 Cr (+22% YoY)

Comparison: Best-ever Q2 with highest ARR, revenue, EBITDA, PBT, PAT and cash profit

Drivers: Higher occupancy, improved ARR, operational efficiencies, portfolio expansion

Key Risks: GST impact (2.4% of revenue), Stock Appreciation Rights provision (0.8% of revenue), raw material costs

Geographical Revenue Split

Network Revenue Breakdown (Q2 FY27):

  • Owned hotels: ₹337 Cr (59% of total)
  • Managed and franchised hotels: ₹236 Cr (41% of total)
  • Domestic vs Export: Not specified
  • Regional breakdown: Mumbai contributed 30% of hotel EBITDAR on 26% of revenue

Balance Sheet Snapshot

As of September 30, 2026:

  • Shareholder's Funds: ₹1,500.1 Cr (+21% YoY)
  • Gross Debt: ₹1,429.2 Cr (-11% YoY)
  • Lease Liabilities: ₹408.4 Cr (-9% YoY)
  • Debt to Equity: 0.64x (vs 0.86x YoY)
  • Cost of Debt: 7.44% (-28 bps YoY)
  • Current Assets: ₹390.9 Cr (+12% YoY)
  • Current Liabilities: ₹197.5 Cr (+18% YoY)

Financial Health Insights: Strong cash flow generation, improved liquidity, reduced leverage

Capex & Cash Flow Health

Capital Expenditure:

  • Aurika, Shimla (90 rooms, owned): ₹122 Cr deployed, expected opening FY27
  • Aurika, Shillong (165 rooms, leased): ₹47 Cr deployed, expected opening FY28
  • Aurika, Varanasi (47 rooms, leased): ₹1 Cr deployed, expected opening FY29
  • Lemon Tree Premier, Bandra, Mumbai (172 rooms, owned): ₹129 Cr deployed (including ₹120 Cr land cost), expected opening FY30
  • Aurika, Nehru Place, Delhi (610 rooms, leased): Capital deployment TBD, expected opening CY31

Cash Flow:

  • Free Cash Flow: Not specified
  • Operating Cash Flow: Not specified
  • Net Debt Movement: Gross debt reduced by 11% YoY

Investment Rationale: Focus on capacity expansion in premium segments, strategic locations in key markets

Strategic & R&D Initiatives

Expansion Activities (Q2 FY27):

  • Opened 8 managed/franchised hotels with 523 rooms
  • Signed 11 managed/franchised hotels with 825 rooms
  • Deflagged 5 hotels with 338 rooms

Pipeline Status:

  • Total pipeline: 11,930 rooms across 147 hotels
  • Combined operational + pipeline: 24,061 rooms across 285 hotels in 170+ cities

Digital Transformation:

  • Proprietary tech platform (Totally Foxed Solutions) with AI/ML solutions
  • Infinity Rewards loyalty program with 2.0+ million members

Expected Impact: Portfolio expansion to drive management fee growth and market share gains

Industry Trends & Business Environment

Macro/Industry Trends: Strong travel demand recovery, constrained supply in top markets, favorable demand-supply dynamics

Impact on Company: Higher occupancy rates, pricing power, margin expansion opportunities

Management Commentary & Growth Outlook

Executive Chairman's Statement (Patanjali Keswani):

  • "Best-ever Q2: highest Q2 ARR, Revenue, EBITDA, PBT, PAT and Cash Profit"
  • Highlighted strong operational performance across all brands and regions

Strategic Outlook:

  • Continued expansion through managed/franchised model
  • Focus on premium segment development (Aurika, Lemon Tree Premier)
  • Asset-light growth strategy with focus on fee-based income

FY Guidance: Not explicitly provided

Market Share Targets: Approximately 6% of total branded inventory in India

Risks and Opportunities:

  • Opportunities: Unbranded hotel consolidation, tier II/III market expansion
  • Risks: GST impact, SAR provisions, project execution timelines

Corporate Structure Update

Composite Scheme of Arrangement:

  • Demerger to create two focused platforms: Lemon Tree (asset-light management) and Fleur Hotels (asset ownership)
  • Warburg Pincus acquiring APG's ~41% stake in Fleur
  • Expected to be value-accretive for shareholders
  • Effective ownership in Fleur increases from 45.8% to 57.5% for Lemon Tree shareholders

ESG Updates

FY26 Progress:

  • Renewable Energy: Target 50% usage (exit rate 50.66%)
  • Emissions Reduction: Target 40% reduction in carbon intensity vs FY19
  • Water Conservation: Target 10% reduction in water intensity vs FY19
  • Waste Management: Target 15% reduction in waste intensity vs FY19
  • Diversity: 14.86% ODIs in workforce (target 20%), 13% women in workforce (target 15%)
  • Green Buildings: 100% certified owned/leased hotels target