Lemon Tree Q4 Results Review - Occupancy Rate, ARR Continue To Inch Up; Outlook Remains Robust: Motilal Oswal

Motilal Oswal Report

Lemon Tree Hotels Ltd.'s Q4 FY23 revenue surged 2.1 times YoY (up 8% QoQ and 43% versus Q4 FY20) to Rs 2.5 billion (inline), led by higher average room rate (up 29% versus Q4 FY20 levels) at Rs 5,824.

Occupancy stood at 73.6% versus. 67.6%/46.1%/61% in Q3 FY23/Q4 FY22/ Q4 FY20. Revenue per available room surged 2.3 times YoY to Rs 4,286 versus Rs 3,879/Rs 1,888/ Rs 2,764 in Q3 FY23/Q4 FY22/Q4 FY20.

Lemon Tree's Ebitda jumped 2.2 times from Q4 FY20 levels (up 3.8 times YoY and 11% QoQ) to Rs 1.4 billion (our estimate: Rs 1.47 billion). Ebitda margin stood at 55.4% (our estimate: 57%).

Adjusted profit after tax stood at Rs 440 millio in Q4 FY23 (our estimate: Rs 523 million) versus a net loss of Rs 132 million in Q4 FY22.

In Q4 FY23, Keys Hotels generated revenue of Rs 182 million (up 2% QoQ and 2.3x YoY), with Ebtda of Rs 75 million (up 1.6 times QoQ and 6.8 times YoY).

It operated at 55.6% occupancy (up 23.6pp YoY), with ARR of Rs 3,264 (up 37% YoY).

In FY23, revenue/Ebitda grew 2.2 times/3.4 times YoY to Rs 8.6 billion/Rs 4.5 billion, while adjusted profit after tax was Rs 1.2 billion versus a loss of Rs 760 million in FY22. Ebitda margin in FY23 hit the record high of 51.7% (up 18.4% YoY).

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