Lemon Tree Hotels Limited Q2 profit rises 90% to Rs 79.76 crore

Lemon Tree Hotels Limited reported consolidated net profit of Rs 79.76 crore for the quarter ended September 30, 2026, up 90% from Rs 41.93 crore a year earlier. Revenue from operations rose 18% to Rs 361.38 crore, while a Rs 41.64 crore gain on a lease termination contributed to the reported earnings increase.

How did Lemon Tree Hotels perform in Q2 2026?

Lemon Tree Hotels increased revenue from operations to Rs 361.38 crore in the September 2026 quarter from Rs 306.28 crore in the September 2025 quarter, while total income rose to Rs 363.82 crore from Rs 308.00 crore. Net profit after tax rose by Rs 37.83 crore year on year to Rs 79.76 crore.

Compared with the immediately preceding June 2026 quarter, revenue rose from Rs 344.61 crore and net profit after tax increased from Rs 57.34 crore. Profit before tax was Rs 110.87 crore in the September 2026 quarter, compared with Rs 55.83 crore a year earlier and Rs 79.12 crore in the June 2026 quarter.

Lemon Tree Hotels reported profit before depreciation, amortisation, finance cost, finance income and tax of Rs 162.16 crore, up from Rs 132.45 crore in the September 2025 quarter. Total expenses were Rs 201.66 crore in the latest quarter, while the operating-profit measure increased by Rs 29.72 crore year on year.

What drove Lemon Tree Hotels' quarterly profit increase?

Lemon Tree Hotels' reported profit included a net exceptional gain of Rs 22.09 crore in the September 2026 quarter. The largest item was a Rs 41.64 crore gain, net of assets written off, on terminating the lease contract for Lemon Tree Premier 2, Gurugram.

The lease-termination gain was partly offset by a Rs 15.83 crore provision for a property-tax matter, a Rs 3.35 crore provision on diminution in the carrying value of an associate investment and Rs 0.37 crore of acquisition or potential-acquisition expenses. Lemon Tree Hotels classified the property-tax provision as exceptional based on its assessment, including recent judicial determinations, and its historical and one-time nature.

Before exceptional items and tax, Lemon Tree Hotels earned Rs 88.78 crore, compared with Rs 55.83 crore in the September 2025 quarter. Finance cost declined to Rs 30.48 crore from Rs 45.05 crore, while depreciation and amortisation increased to Rs 36.61 crore from Rs 34.32 crore.

Finance income was Rs 3.05 crore in the September 2026 quarter, against Rs 2.75 crore a year earlier. The group recorded a Rs 0.35 crore share of loss from associates, compared with a Rs 0.01 crore share of profit in the prior-year quarter, while current and deferred tax together rose to Rs 31.11 crore from Rs 13.89 crore.

How did Lemon Tree Hotels perform in the first half?

Lemon Tree Hotels recorded revenue from operations of Rs 705.98 crore for the half year ended September 30, 2026, compared with Rs 622.05 crore in the corresponding 2025 period. Half-year net profit after tax increased to Rs 137.10 crore from Rs 90.03 crore, while profit before tax rose to Rs 189.91 crore from Rs 118.69 crore.

Lemon Tree Hotels generated net cash from operating activities of Rs 306.76 crore in the six months to September 30, 2026, compared with Rs 234.41 crore a year earlier. Investing activities used Rs 163.70 crore, versus Rs 72.96 crore in the previous corresponding period, including Rs 210.81 crore spent on property, plant and equipment, intangible assets and related capital items.

Cash and cash equivalents stood at Rs 57.02 crore on September 30, 2026, compared with Rs 58.10 crore at the beginning of the half year. Net cash used in financing activities was Rs 44.14 crore, after Rs 65.13 crore of interest paid and Rs 99.28 crore of long-term borrowing repayments during the period.

What is Lemon Tree Hotels' proposed restructuring scheme?

Lemon Tree Hotels is pursuing a composite scheme of arrangement to separate its hotel ownership and development business from its hotel management and brand business into separate focused platforms. Its board approved the proposed scheme on January 9, 2026, with an appointed date of April 1, 2026.

The scheme had not become effective as of the November 5, 2026 results filing because it requires statutory, regulatory and shareholder approvals, National Company Law Tribunal sanction and filing of the certified tribunal order with the Registrar of Companies. The Competition Commission of India approved the combination contemplated under the scheme on April 7, 2026.

The National Stock Exchange of India issued a no-objection observation letter and BSE issued a no-adverse-observations letter on September 22, 2026. Lemon Tree Hotels subsequently filed an application seeking sanction from the National Company Law Tribunal's Chandigarh Bench on October 9, 2026.

Lemon Tree Hotels reported hoteliering as its single operating segment under Indian Accounting Standard 108, so the filing does not provide revenue or profit splits between ownership, development, management and brand activities. The audit committee and board reviewed and approved the unaudited consolidated results on November 5, 2026.

Conclusion

Lemon Tree Hotels combined 18% quarterly revenue growth with a 90% increase in consolidated net profit to Rs 79.76 crore in the quarter ended September 30, 2026. Operating profit before depreciation and finance items rose 22% to Rs 162.16 crore, lower finance cost supported earnings, and the Rs 22.09 crore net exceptional gain lifted reported profit before tax.

The next disclosed matter to watch is the restructuring scheme, for which Lemon Tree Hotels filed its tribunal application on October 9, 2026 after receiving stock-exchange observation letters. The separation will take effect only after the remaining statutory, regulatory and shareholder approvals, tribunal sanction and filing of the certified order with the Registrar of Companies.