Profit before exceptional items and tax surged 17.40% to Rs 143.53 crore in Q4 FY26 from Rs 122.25 crore recorded in the same quarter a year ago. The company also reported exceptional items worth Rs 1.93 crore during the period.

EBITDA stood at Rs 218.3 crore in the March quarter, registering a 6.48% year-on-year growth. However, EBITDA margin declined to 52% from 54% in Q4 FY25.

Operationally, the company reported strong growth in room metrics. Gross average revenue per room (ARR) rose 5.89% YoY to Rs 7,457, while occupancy improved to 78.5% compared with 77.6% in the year-ago quarter. Revenue per available room (RevPAR) increased 7.19% to Rs 5,855 in Q4 FY26.

For the full financial year FY26, Lemon Tree Hotels posted a 15.52% rise in consolidated net profit to Rs 227.10 crore, while revenue from operations climbed 12.31% to Rs 1,444.50 crore.

Patanjali Keswani, Executive Chairman, Lemon Tree Hotels, said, Despite intermittent global headwinds, including renewed geopolitical tensions in the Middle East, aviation disruptions and GST changes during the year, FY26 was the best year in Lemon Tree's history across occupancy, ARR, revenue, EBITDA, PBT, PAT and cash profit, and Q4 FY26 was our best ever fourth quarter on the same parameters.

In FY26, our margins were impacted by 580 basis points due to a significant step-up in renovation expenditure as we invest in upgrading our owned hotel portfolio, investments in technology and the GST-related change that came into effect during the year, which only had a half-year impact in FY26 and will have a full-year impact going forward. This GST impact will decrease year on year as the numbers of customers paying a rate below Rs 7,500 keep reducing in the medium term with our price hikes / ARR growth. Additionally, all our current future supply is being planned under the upper upscale Aurika brand, which remains largely unaffected by this change. We expect all these 3 expense heads to reduce to ~3.7% of revenue by FY28 and onwards, leading to a corresponding expansion in EBITDA margins.

On debt, we have brought our total borrowings down to Rs 1,500 crore from Rs 1,699 crore vs a year ago, and our cost of debt has fallen to 7.42%, down 115 basis points vs a year ago. Our combined operational and signed pipeline inventory now stands at 22,581 rooms across 268 hotels of which 131 hotels with 11,811 rooms are already operational.

In FY26, on the asset-light side we opened 20 managed and franchised hotels with 1,523 rooms and signed 55 managed and franchised hotels with 4,912 rooms. Fees from management and franchised contracts for third-party-owned hotels stood at Rs 73.9 crore in FY26, an increase of 23% year on year. Fees from Fleur Hotels stood at Rs 95.8 crore in FY26, an increase of 8% year on year, which was partially subdued due to the impact of the GST change and accelerated renovation in the Fleur portfolio.

Total management fees for Lemon Tree stood at Rs 169.7 crore in FY26, an increase of 14% year on year. Lastly, the Indian hospitality market continues to be in a favourable structural position, demand is consistently outpacing supply in the mid-market segment, which is exactly where we operate.

Lemon Tree Hotels (LTHL) is one of the largest hotel chains in India and owns/leases/operates/franchises hotels across the upscale, upper-midscale, midscale, and economy segments. The group offers seven brands to meet guests' needs across all levels, viz., Aurika Hotels & Resorts, Lemon Tree Premier, Lemon Tree Hotels, Red Fox Hotels by Lemon Tree Hotels, Keys Prima by Lemon Tree Hotels, Keys Select by Lemon Tree Hotels, and Keys Lite by Lemon Tree Hotels.

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