Lemon Tree Hotels announced its highest-ever Q2 revenue, reaching ₹308 crore, an 8% increase compared to last year. The company’s profit after tax stood at ₹41.9 crore, a 20% YoY increase. Despite industry headwinds, strategic renovations and technology investments have positioned the company for continued growth in occupancy and average room rates.
Financial Highlights for Q2 FY26
Despite facing geopolitical tensions, floods, and other challenges, Lemon Tree Hotels reached a record ₹308 crore in revenue during Q2 FY26, marking an 8% increase year-over-year.
Key financial metrics include:
- Net EBITDA: Grew 1% to ₹132.4 crore.
- Occupancy Rate: 69.8%, up 139 bps YoY.
- Average Room Rate (ARR): ₹6,247, a 6% increase YoY.
- RevPAR: ₹4,358, an 8% increase YoY.
- Profit After Tax: ₹41.9 crore, a 20% YoY increase.
- Cash Profit: ₹76.3 crore, a 9.2% YoY increase.
The company’s debt stood at ₹1,610 crore as of September 30, 2025, a reduction of ₹212 crore from the previous year. Lemon Tree also improved its credit rating to A+, reducing borrowing costs to 7.72% in Q2.
Strategic Initiatives and Expansion
Lemon Tree Hotels signed 15 new management and franchise contracts, adding 1,138 rooms to its pipeline and operationalized 5 hotels, contributing 272 rooms to its operational portfolio.
The company secured a Letter of Award for 2.25 acres of land in Nehru Place, New Delhi, for a proposed 500-550 room Aurika hotel.
Investments and Renovations
Lemon Tree Hotels invested in significant renovations, technology upgrades, and employee benefits, impacting EBITDA margins by 306 bps YoY. These investments, accounting for 8% of revenue this quarter, are expected to decrease to 5% next year and stabilize at 2% by FY28.
Outlook
The company anticipates continued growth, driven by strategic investments and renovations leading to increased occupancy and ARR.
Source: BSE