LEMON TREE HOTELS 2023-24 Annual Report Analysis

Mon, 9 Sep

LEMON TREE HOTELS has announced its results for the year ended March 2024. Let us have a look at the detailed performance review of the company during FY23-24.

LEMON TREE HOTELS Income Statement Analysis

• Operating income during the year rose 22.4% on a year-on-year (YoY) basis.
• The company's operating profit increased by 16.8% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 48.9% in FY24 as against 51.3% in FY23.
• Depreciation charges increased by 16.1% and finance costs increased by 14.3% YoY, respectively.
• Other income grew by 42.7% YoY.
• Net profit for the year grew by 29.3% YoY.
• Net profit margins during the year grew from 16.1% in FY23 to 17.0% in FY24.

LEMON TREE HOTELS Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	8,750	10,711	22.4%
Other income	Rs m	88	125	42.7%
Total Revenues	Rs m	8,837	10,836	22.6%
Gross profit	Rs m	4,484	5,239	16.8%
Depreciation	Rs m	966	1,121	16.1%
Interest	Rs m	1,823	2,085	14.3%
Profit before tax	Rs m	1,782	2,158	21.1%
Tax	Rs m	377	341	-9.5%
Profit after tax	Rs m	1,405	1,817	29.3%
Gross profit margin	%	51.3	48.9
Effective tax rate	%	21.2	15.8
Net profit margin	%	16.1	17.0

Don't Miss: Key Information for Long-term Investors

LEMON TREE HOTELS Balance Sheet Analysis

• The company's current liabilities during FY24 down at Rs 4 billion as compared to Rs 4 billion in FY23, thereby witnessing an decrease of -3.0%.
• Long-term debt stood at Rs 17 billion as compared to Rs 15 billion during FY23, a growth of 10.5%.
• Current assets rose 51% and stood at Rs 2 billion, while fixed assets rose 7% and stood at Rs 38 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 40 billion as against Rs 37 billion during FY23, thereby witnessing a growth of 8%.

LEMON TREE HOTELS Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	8,537	9,669	13.3
Current Liabilities	Rs m	3,701	3,591	-3.0
Long-term Debt	Rs m	15,174	16,767	10.5
Total Liabilities	Rs m	36,958	39,972	8.2
Current assets	Rs m	1,360	2,053	50.9
Fixed Assets	Rs m	35,598	37,919	6.5
Total Assets	Rs m	36,958	39,972	8.2

LEMON TREE HOTELS Cash Flow Statement Analysis

• LEMON TREE HOTELS's cash flow from operating activities (CFO) during FY24 stood at Rs 5 billion, an improvement of 20.8% on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -4 billion, an improvement of 40.0% on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -585 million, an improvement of 56% on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs 100 million from the Rs -306 million net cash flows seen during FY23.

LEMON TREE HOTELS Cash Flow Statement 2023-24

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-23	Mar-24
Cash Flow from Operating Activities	Rs m	3,849	4,650	20.8%
Cash Flow from Investing Activities	Rs m	-2,832	-3,965	-
Cash Flow from Financing Activities	Rs m	-1,323	-585	-
Net Cash Flow	Rs m	-306	100	-

Current Valuations for LEMON TREE HOTELS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 2.3, an improvement from the EPS of Rs 1.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 130.0, stands at 59.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 10.6 times, while the price to sales ratio stands at 9.6 times.
• The company's price to cash flow (P/CF) ratio stood at 30.0 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Sales per share (Unadj.)	Rs	11.1	13.5
TTM Earnings per share	Rs	1.8	2.3
Diluted earnings per share	Rs	1.8	2.3
Price to Cash Flow	x	25.8	30.0
TTM P/E ratio	x	43.8	59.2
Price / Book Value ratio	x	7.2	9.1
Market Cap	Rs m	61,547	88,041
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for LEMON TREE HOTELS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 0.6x during FY24, from 0.4x during FY23. The current ratio measures the company's ability to pay short-term and long-term obligations.

Interest Coverage Ratio: The company's interest coverage ratio improved and stood at 2.0x during FY24, from 2.0x during FY23. The interest coverage ratio of a company states how easily a company can pay its interest expense on outstanding debt. A higher ratio is preferable.

• Profitability Ratios

Return on Equity (ROE): The ROE for the company improved and stood at 18.8% during FY24, from 16.5% during FY24. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

Return on Capital Employed (ROCE): The ROCE for the company improved and stood at 16.1% during FY24, from 15.2% during FY23. The ROCE measures the ability of a firm to generate profits from its total capital (shareholder capital plus debt capital) employed in the company.

Return on Assets (ROA): The ROA of the company improved and stood at 9.8% during FY24, from 8.7% during FY23. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Current ratio	x	0.4	0.6
Debtors’ Days	Days	234	244
Interest coverage	x	2.0	2.0
Debt to equity ratio	x	1.8	1.7
Return on assets	%	8.7	9.8
Return on equity	%	16.5	18.8
Return on capital employed	%	15.2	16.1

To see how LEMON TREE HOTELS has performed over the last 5 years, please visit here.

LEMON TREE HOTELS Share Price Performance

Over the last one year, LEMON TREE HOTELS share price has moved up from Rs 115.7 to Rs 130.0, registering a gain of Rs 14.3 or around 12.4%.

Overall, the S&P BSE SENSEX is up 23.7% over the year.

(To know more, check out historical annual results for LEMON TREE HOTELS and quarterly results for LEMON TREE HOTELS)