Buy Lemon Tree Hotels, target price Rs 84: ICICI Securities

ICICI Securities has buy call on Lemon Tree Hotels with a target price of Rs 84. The current market price of Lemon Tree Hotels is Rs 65.8. Time period given by analyst is one year when Lemon Tree Hotels Ltd. price can reach defined target.

Lemon Tree Hotels Ltd., incorporated in the year 1992, is a Mid Cap company (having a market cap of Rs 5236.75 Crore) operating in Tourism & Hospitality sector.

Lemon Tree Hotels Ltd. key Products/Revenue Segments include Income from Rooms, Restaurants & Other Services and Other Operating Revenue for the year ending 31-Mar-2021.


Financials
For the quarter ended 30-06-2022, the company reported a Consolidated Total Income of Rs 192.29 Crore, up 51.21 % from last quarter Total Income of Rs 127.17 Crore and up 334.26 % from last year same quarter Total Income of Rs 44.28 Crore. Company reported net profit after tax of Rs 13.30 Crore in latest quarter.

Investment Rationale
While there has been a faster-than-expected recovery in occupancies and multiple demand drivers in Q1FY23, heading into the remainder of FY23, it retains FY23-24E revenue/EBITDA estimates keeping room for any negative surprises driven by macro concerns over inflation and lower discretionary spends. It maintains BUY rating with an unchanged SoTP-based target price of Rs84/share at an unchanged EV/EBITDA multiple of 20x on Mar’24E EV/EBITDA.

Promoter/FII Holdings
Promoters held 23.93 per cent stake in the company as of 30-Jun-2022, while FIIs owned 27.93 per cent, DIIs 11.4 per cent.