Lemon Tree Hotels Ltd consolidated net profit of Rs2.29cr in Q1FY19, vs net loss of Rs2.37cr in Q1FY18

The company’s consolidated revenue stood at Rs127.87cr, up 18.11% yoy but down 3.14% qoq.

Aug 13, 2018 02:08 IST India Infoline Research Team

Lemon Tree Hotels Ltd Q1FY19

Consolidated Results Q1FY19: (Rs. in cr)

Q1FY19 YoY (%)
Revenue 127.87 18.1
EBITDA 34.81 30.7
EBITDA Margin (%) 27.2 262
Net Profit (adjusted) 2.29 -
***EBITDA margin change is bps
Lemon Tree Hotels Ltd's consolidated revenue for the quarter came in at Rs127.87cr, up by 18.1% yoy. The operating profit for the quarter increased by 30.7% yoy to Rs34.81cr. The EBITDA margin increased by ~262bps yoy to 27.2% in Q1FY19. The adjusted net profit after tax (attributable to owners) stood at Rs2.29cr in Q1FY19 vs. net loss of Rs2.37cr in Q1FY18.
• The rise in revenue is on account of increase in average room rent (ARR) by 15% yoy and incremental occupancy growth of ~250bps. This resulted into revenue per available room (RevPAR) growth of 19% yoy.
• The available room inventory has increased to 4,998 rooms as on June 30, 2018 as against 4,870 rooms as on March 31, 2018. The inventory addition during the quarter is under managed rooms segment. The new inventory addition resulted into ~3% increase in the revenue.
• The ARR has increased by 15% yoy to Rs3,899 during the quarter. The occupancy stood at 76.8%, a rise by ~250bps yoy during the quarter.
• The rising RevPAR provided operating leverage to the company during the quarter, leading to significant jump in EBITDA by 30.7% yoy. The EBITDA margin expanded by ~263bps due to the above factors.
• Total expenses increased by 14% yoy in Q1FY19. Out of this, ~4% increase was on account of new inventory and ~2% increase is due to change in business mix.
• The cash profit of the company during the quarter increased by ~41% yoy to Rs154cr.
• Operational portfolio of the company as on June 30, 2018 comprised of 49 hotels and 4,887 rooms: 2,796 owned, 481 leased and 1,610 managed.
• In terms of seasonality, first quarter for the company usually contributes 22% and 19% to the total revenue and EBITDA during the financial year.
• The company has a pipeline for hotels under development of 1,525 rooms with an estimated cost of Rs1,725cr as on June 30, 2018. Total capex already incurred as on June 30, 2018 is Rs931cr.
• The company has a pipeline of 1,713 rooms under management contract as on July 31, 2018.

Technical View:

Lemon Tree Hotels Ltd is currently trading at Rs. 78.75, down by 1.85 points or 2.3% from its previous closing of Rs. 80.60 on the BSE.
The scrip opened at Rs. 79.85 and has touched a high and low of Rs. 81.90 and Rs. 77.75 respectively. So far 5,15,020 (NSE+BSE) shares were traded on the counter. The stock is currently trading below its 50 DMA.

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