CLSA retains buy on Lemon Tree Hotels, target price Rs 80

CLSA has retained buy rating on Lemon Tree Hotels in the long term with a target price of Rs 80. Shares of Lemon Tree ended down 2% at Rs 59.35 on Friday while BSE Sensex closed 70.21 points up at 40,356.69.

Company Financials

For the quarter ended 30-09-2019, the company has reported consolidated sales of Rs 152.76 crore, up 8.39% from last quarter sales of Rs 140.93 crore and up 18.70% from last year same quarter sales of Rs 128.69 crore. The company has reported net profit after tax of Rs -2.74 crore in the latest quarter.


Investment Rationale

With the launch of the Kolkata and Udaipur property in the second quarter of FY20, the execution risk for Lemon Tree is now largely behind, said CLSA. Lemon Tree completed the acquisition of ‘Keys’ on November 1 and would be consolidated from third quarter onwards, said CLSA.