Lemon Tree Hotels Q3 FY26 results: net profit up 2.5% to ₹81.83 crore, revenue up 14.3%

How did Lemon Tree Hotels perform in Q3 FY26?

Lemon Tree Hotels reported consolidated revenue of ₹406.05 crore for Q3 FY26, up 14.3% from ₹355.18 crore in Q3 FY25 and up 32.6% from ₹306.28 crore in Q2 FY26. EBITDA was ₹204.69 crore, up 11.1% year on year and up 56.6% from the previous quarter, with the margin at 50.4% against 51.9% a year earlier and 42.7% in Q2 FY26.

Net profit for the quarter was ₹81.83 crore, compared with ₹79.84 crore in Q3 FY25 and ₹41.93 crore in Q2 FY26. Profit attributable to owners was ₹62.67 crore against ₹62.49 crore a year earlier. Basic EPS was ₹0.79, unchanged from Q3 FY25 and up from ₹0.44 in Q2 FY26. Profit before tax was ₹98.83 crore, down 0.6% from ₹99.42 crore a year earlier.

On a standalone basis, revenue for the quarter was ₹124.62 crore, up 19.6%, and net profit was ₹23.16 crore against ₹28.5 crore in the year-ago period. The company also filed an investor presentation for the Q3 and 9M FY26 unaudited results on the same day.

What changed in Lemon Tree Hotels' costs and profit?

Total expenses rose 8.3% year on year to ₹277.59 crore, with other expenses up 25.3% at ₹118.94 crore, an increase of ₹24.03 crore. Cost of materials consumed rose 17.3% to ₹23.02 crore and employee cost rose 5.3% to ₹59.40 crore. Finance costs fell 17.7% to ₹41.44 crore and depreciation was ₹34.79 crore, down 0.8%.

Other income was ₹1.70 crore, up from ₹0.62 crore a year earlier. The company recorded an exceptional item of ₹31.33 crore as a charge, against no exceptional item in Q3 FY25 and Q2 FY26. Tax expense was ₹17.02 crore, down 13.4% from ₹19.66 crore.

Against the previous quarter, total expenses rose 10.1% to ₹277.59 crore and other expenses rose 22.6% to ₹118.94 crore. Other income was ₹1.70 crore against ₹1.72 crore, and tax was ₹17.02 crore against ₹13.90 crore. The company attributed the year-on-year margin decline to increased investments in renovation, technology and the GST impact.

How did the first nine months of FY26 go?

For the first nine months of FY26, consolidated revenue was ₹1,028.10 crore, up 13.3% from ₹907.56 crore in 9M FY25. Total income was ₹1,033.16 crore, up 13.7%, and profit before tax was ₹217.91 crore, up 25.5% from ₹173.62 crore.

Net profit for 9M FY26 was ₹171.87 crore, up 27.3% from ₹135.0 crore a year earlier, and EPS was ₹1.71 against ₹1.41 in 9M FY25.

How has Lemon Tree Hotels done over the last 8 quarters?

Revenue rose year on year in each of the last eight quarters, while profit rose year on year in each of the last six. Revenue reached a period high of ₹406.05 crore in Q3 FY26, and the EBITDA margin was also at its highest of the last four quarters at 50.4%.

Over the last four quarters, revenue moved from ₹315.77 crore in Q1 FY26 to ₹306.28 crore in Q2 FY26 and ₹406.05 crore in Q3 FY26. The EBITDA margin fell from 44.5% to 42.7% before recovering to 50.4%, and net profit moved from ₹48.1 crore to ₹41.93 crore and then ₹81.83 crore.

What else did the company announce?

Lemon Tree Hotels filed an intimation on 31 January 2026 stating that the board would meet on 6 February 2026 to consider and approve the unaudited standalone and consolidated financial results for the quarter and nine months ended 31 December 2025. The company also said the trading window for designated persons and their immediate relatives would remain closed until 48 hours after the public announcement of the results.

In its outcome of board meeting filing on 6 February 2026, the company said the board, which met from 5:00 PM to 8:30 PM, approved the standalone and consolidated unaudited financial results for the quarter and nine months ended 31 December 2025, along with the limited review report of the statutory auditors. The same-day investor presentation noted that an investor and analyst call was scheduled for 10 February 2026 at 4:00 PM IST. No dividend, fund raise or appointment was disclosed in the filings listed.

What did Lemon Tree Hotels' management say?

Executive Chairman Patanjali Keswani said the margin decline was primarily due to increased investments in renovation, technology and the GST impact, and that these expenses and investments accounted for 6.4% of revenue for the quarter. He said the company expects all three expense heads to reduce to ~3.6% of revenue by FY28 and onwards, leading to corresponding expansion in EBITDA margins.

Keswani said the GST change in the quarter accounted for 1.8% of revenue in a seasonally strong quarter of the year, and that the company expects this to be 2% for the full year in FY27 and then further reduce to 1.7% in FY28. He said the decline will be a year-on-year trend as the impact in the long term is offset by an increase in volume of demand arising from lowering of rates due to GST going down to 5%, and that the ARR for most hotels goes above 7,500. He added that current future supply is being planned under the upper upscale Aurika brand, which remains largely unaffected by the change.

Keswani said Q3 FY26 recorded a gross ARR of ₹7,487, which increased 11% year on year, with occupancy at 73.4%, a decrease of 82 bps year on year, and RevPAR at ₹5,494, up 9% year on year. He said the company incurred an expense of ₹31.3 crore as a one-off exceptional item related to Labour Code impact, ex-gratia payments to employees and a property tax payment in relation to the properties at New Delhi.

On expansion, Keswani said the company signed 17 new management and franchise contracts in Q3, adding 1,855 new rooms to the pipeline, and operationalised 9 hotels, adding 816 rooms to the operational portfolio. He said the company plans to open 2 out of 3 blocks of Aurika, Shimla by Q2, and that a license deed was signed in January for a 47-room heritage hotel at Varanasi located on the ghat adjoining the River Ganges. The company's earnings presentation noted that forward-looking statements involve risks, uncertainties and other factors, and listed changes in industry structure, political and economic conditions, tax laws, import duties, litigation and labour relations as important developments that could affect operations.

How did Lemon Tree Hotels shares react?

The filing was made after market hours from a base price of ₹127.90, with the stock down 0.9% five minutes after the results appeared and up 0.2% at both 15 and 30 minutes. On the reaction day, the stock was up 2.3% from its previous close of ₹126.75, and by the next day's close it was up 4.5% from that pre-results close. Over five sessions the stock was down 0.6% from the pre-results close.

Past results-day moves were mixed: the stock fell 5.1% on 12 November 2025, fell 0.7% on 8 August 2025 and fell 2.3% on 29 May 2025, while it rose 0.2% on 4 February 2025 and on 14 November 2024. It fell 9.4% on 7 August 2024 and fell 0.2% on 29 May 2024.

How did other Hotels & Resorts companies do?

Among 49 Hotels & Resorts companies compared, the median revenue growth was 7.4%, against Lemon Tree Hotels' revenue growth of 14.3% in Q3 FY26. Of the peers compared, 35 grew slower than the company and 14 grew faster than the company.

Of the 53 peers whose profit was compared, 26 reported higher profit. The peer data is as of 5 November 2026.