Lemon Tree Hotels Ltd. · NSE:LEMONTREE
Lemon Tree Hotels — 26th CITIC CLSA India Forum 2023
52 slides from Lemon Tree Hotels's conference presentation, Nov 28, 2023
Slide 1: Disclosure under Regulation 30 – Analysts/Investor Meet
November 28, 2023 National Stock Exchange of India Limited BSE Limited Exchange Plaza, C-1, Block G Phiroze Jeejeebhoy Towers Bandra Kurla Complex Dalal Street, Mumbai – 400001 Bandra (E), Mumbai – 400051 NSE Scrip Symbol: LEMONTREE BSE Scrip Code: 541233 Subject: Disclosure under Regulation 30(6) o
Slide 2: Lemon Tree Hotels Limited Corporate Presentation
December 2023 Corporate Presentation 1 Lemon Tree Hotels Limited Corporate Presentation | December 2023 Aurika, Mumbai Sky City
Slide 3: Our Journey
December 2023 Corporate Presentation 2 Our Journey
Slide 4: Two decades of transforming the Indian hospitality landscape
December 2023 Corporate Presentation 3 Two decades of transforming the Indian hospitality landscape 2022 2028 2018 • ~8,400 rooms • 20K+ rooms** • Lemon Tree Hotels IPO • 88 hotels • 300+ hotels*** • 50th hotel opened • 54 destinations 2010 • Lemon Tree Premier 2019 2023 brand launched • 13K+ rooms*
Slide 5: A snapshot of our network
December 2023 Corporate Presentation 4 A snapshot of our network Operational Pipeline Operational + Pipeline Group 9,429 3,792 13,221 rooms; rooms; rooms; 96 hotels 56 hotels 152 hotels Brand Current Pipeline Operational + Pipeline Aurika Hotels & Resorts 863 Rooms; 3 Hotels 242 Rooms; 2 Hotels 1105
Slide 6: Large underserved mid-scale market
December 2023 Corporate Presentation 5 Large underserved mid-scale market India is transitioning from the inverted supply pyramid to a corrected future with strong base of midscale and economy supply India's transitioning to global standards on hotel room supply Potential Future 2002 India: 2022* US
Slide 7: Leaders in upper midscale to economy segment, and expanding in upscale
December 2023 Corporate Presentation 6 Lemon Tree Hotels are leaders in upper midscale to economy segment, and expanding in upscale Our Inventory as Segment Industry Inventory Our Inventory % of Industry Lemon Tree Brand Positioning Luxury and Upper Upscale 62,107* 863 0.9% * Upscale 33,715 Upper Mi
Slide 8: Roadmap for next 5 years
December 2023 Corporate Presentation 7 Roadmap for next 5 years
Slide 9: Lemon Tree 2.0: Roadmap for next 5 years – CY24 to CY28
December 2023 Corporate Presentation 8 Lemon Tree 2.0: Roadmap for next 5 years – CY24 to CY28 Lemon Tree 2.0 Superior financial Mid-market hotel Strong balance Leader in Leader in performance flagbearer sheet digital ESG Strategic Levers Asset Light (How will we make this Digital Simplifying Growth
Slide 10: Outcomes
December 2023 Corporate Presentation 9 OUTCOMES
Slide 11: LT 2.0: setting clear and achievable outcomes over the next 5 years
December 2023 Corporate Presentation 10 LT 2.0: setting clear and achievable outcomes over the next 5 years Superior financial Mid-market hotel Strong balance Leader in digital Leader in ESG performance leader sheet Bionic Revenue 100% green 20k+ hotel certified Management rooms buildings Stable 50%
Slide 12: Strategic Levers
December 2023 Corporate Presentation 11 STRATEGIC LEVERS
Slide 13: Lemon Tree 2.0: Strategic levers (1 of 5)
December 2023 Corporate Presentation 12 Lemon Tree 2.0: Strategic levers (1 on 5) Asset Light Growth Network Effect Rapid expansion at negligible cost 300+ hotels**: Spread across length & breadth of India ~15k rooms network* of managed & franchised Pan-India hotel presence: We are everywhere portfo
Slide 14: Lemon Tree 2.0: Strategic levers (2 of 5)
December 2023 Corporate Presentation 13 Lemon Tree 2.0: Strategic levers (2 on 5) Digital Transformation Build on Retail Bionic Pricing & Revenue Management 65% retail share target Next Gen Sales: Data driven sales recommendations Dynamic & Market driven pricing Data Driven decision making across fu
Slide 15: Lemon Tree 2.0: Aggressive agenda for Digital Transformation
December 2023 Corporate Presentation 14 Lemon Tree 2.0: Aggressive agenda for Digital Transformation Wave 1: LT Own Hotels Wave 2a: Expand to Managed Network Commercial Smart Operations Platform as a Service Bionic Revenue Management Real-time cost control towers Platform as a Service • AI/ML driven
Slide 16: Lemon Tree 2.0: Strategic levers (3 of 5)
December 2023 Corporate Presentation 15 Lemon Tree 2.0: Strategic levers (3 on 5) Nourish Loyalty Operate Lean Rewards Program: loyalty and churn management 50% EBIDTA: Industry leading efficiencies >40% repeat customers Smart operations: Real-time cost control towers Personalization: Improved custo
Slide 17: Lemon Tree 2.0: Strategic levers (4 of 5)
December 2023 Corporate Presentation 16 Lemon Tree 2.0: Strategic levers (4 on 5) Capital recycling of owned network Large network of owned hotels: 40 operational hotels with 5k+ rooms, 2 hotels with 700+ rooms in pipeline ~40% of total capital employed, operationalized in just the last 3 years ~20%
Slide 18: Lemon Tree 2.0: Strategic levers (5 of 5)
December 2023 Corporate Presentation 17 Lemon Tree 2.0: Strategic levers (5 on 5) Simplifying group structure Current group structure Lemon Tree Hotels Brand Owner + Asset Owner + Operator As of CY23#, owns (directly/through 100% subsidiaries) & operates 17 hotels, 1.7k+ rooms By/before CY28, propos
Slide 19: Simplified group structure by/before CY28
December 2023 Corporate Presentation 18 Simplified group structure by/before CY28 Simplified group structure Proposed group structure Lemon Tree Hotels Brand Owner + Asset Owner + Operator With Carnation Hotels merged into Lemon Tree Hotels and all 100% owned assets (owned directly/through 100% subs
Slide 20: Enablers
December 2023 Corporate Presentation 19 ENABLERS
Slide 21: Consumption in India at tipping point
December 2023 Corporate Presentation 20 Consumption in India at tipping point Consumer spending, specially on Hospitality related categories expected to grow significantly faster than Nominal GDP in the coming years Indian GDP Consumer Spending CAGR Average CAGR (Nominal LCU) Multiplier (Nominal GDP
Slide 22: Demand outpacing supply in Indian hospitality landscape till FY28
December 2023 Corporate Presentation 21 Demand outpacing supply in Indian hospitality landscape till FY28 High demand period expected in next 5 years, to drive strong growth in ARR and occupancy % FY08-20 FY23-28E Demand-supply mismatch has significant impact on hotel industry ARR & revenues Hotel D
Slide 23: Hotel business shows cyclicality, returns higher at top of cycle
December 2023 Corporate Presentation 22 Hotel business shows cyclicality, returns disproportionately higher in top of cycle Top of cycle yields disproportionately higher returns, business expected to be top of cycle in coming years Observed peak From FY04 to FY08 performance in FY07 to Industry ARR
Slide 24: Growing aspirations, affluence & willingness to pay in Bharat
December 2023 Corporate Presentation 23 Growing aspirations, affluence & willingness to pay in Bharat Average Household (HH) income to increase ~1.4x in the current decade, along with growth of affluence, especially in Tier 2,3 and 4 towns Average Household(HH) India - 2016 India - 2025 income (Lakh
Slide 25: Rigorous approach to risk management and risk mitigation
December 2023 Corporate Presentation 24 Rigorous approach to risk management and risk mitigation Identified Assessed Prioritized Mitigated Monitoring LTH's approach to the 14 risk that Tolerance limits Basis the the risks as per Ongoing / Enterprise Risk matters likelihood & Remove / Periodic manage
Slide 26: ESG Vision FY26
December 2023 Corporate Presentation 25 ESG Vision FY26 Ambitious Targets set for owned properties to become an ESG Leader 100% Certified green building 15% Lower energy consumption* 15% Women in the workforce 50% Renewable energy 30% ODIs** in the workforce 10% Lower water consumption* Majority ind
Slide 27: ESG | Highlights of FY23 initiatives
December 2023 Corporate Presentation 26 ESG | Highlights of FY23 initiatives Energy Renewable energy Green building Diversity and inclusion 15% 10% 50% 10.97% 100% 25% 30% 13% Reduction in Reduction in Renewable energy Renewable energy Certified Green Certified Green ODIs1 in the ODIs1 in the Energy
Slide 28: Strategic Assets
December 2023 Corporate Presentation 27 STRATEGIC ASSETS
Slide 29: Purpose driven culture
December 2023 Corporate Presentation 28 Purpose driven culture ESG* Vision FY26 Office of DE & I** Creating Sustained Value across Employees from Economically/ all stakeholders Socially marginalized Belief: Our business operations backgrounds are inherently integrated with delivering social and envi
Slide 30: LTH has unique expertise as developer, owner & operator of hotels
December 2023 Corporate Presentation 29 LTH has unique expertise as developer, owner & operator of hotels Sales and Development Ownership Operations Land marketing Guest of hotels of hotels of hotels of hotels Development Ownership Management Brand • Identify strategically located land • Ability to
Slide 31: December 2023 Corporate Presentation
December 2023 Corporate Presentation 30
Slide 32: Q2 & H1 FY24 Performance
December 2023 Corporate Presentation 31 Q2 & H1 FY24 Performance
Slide 33: Strong Q2 FY24 performance across key financial metrics
December 2023 Corporate Presentation 32 Strong Q2 FY24 performance across key financial metrics Q2 FY24 performance snapshot vs Q2 FY23 Total Revenue EBITDA EBITDA % Rs. 230.1 Cr Rs. 104.8 Cr 45.5% Up 17% Up 11% Down 225 bps PAT Cash Profit Cost of Debt % Rs. 26.4 Cr Rs. 49.0 Cr 8.84%* Up 36% Up 10%
Slide 34: Q2 FY24 Performance Highlights – Operational Metrics
December 2023 Corporate Presentation 33 Q2 FY24 Performance Highlights – Operational Metrics (Consolidated) Inventory Average Room Rate (Rs.) Owned/Leased rooms Managed/Franchised Total rooms 1% rooms QoQ 6% 7% 5,268 5,237 5,268 8,303 YoY 8,760 4,917 YoY 14% 5,090 5,090 YoY 3,213 3,670 Q2 FY23 Q2 FY
Slide 35: Q2 FY24 Performance Highlights – Financial Metrics
December 2023 Corporate Presentation 34 Q2 FY24 Performance Highlights – Financial Metrics (Consolidated) Revenue from Operations (Rs. Cr) EBITDA (Rs. Cr) 11% -2% 16% 2% 106.8 YoY QoQ YoY QoQ 227.2 227.2 104.8 104.8 222.3 196.7 94.3 Q2 FY23 Q2 FY24 Q1 FY24 Q2 FY24 Q2 FY23 Q2 FY24 Q1 FY24 Q2 FY24 EBI
Slide 36: Q-o-Q performance of FY23 and FY24
December 2023 Corporate Presentation 35 Q-o-Q performance of FY23 and FY24 Q2 FY24 was the best ever “Q2” Particulars Q2 FY24 Q1 FY24 Q4 FY23 Q3 FY23 Q2 FY23 Q1 FY23 Gross ARR (Rs.) 5,268 5,237 5,824 5,738 4,917 4,822 Occupancy % 71.7% 70.2% 73.6% 67.6% 66.2% 65.1% Revenue (Rs. Cr) 230.1 224.6 254.7
Slide 37: Total Management Fees | Q2 FY24 vs Q2 FY23
December 2023 Corporate Presentation 36 Total Management Fees | Q2 FY24 vs Q2 FY23 24.0 18.7 13.6 12.1 10.4 + = 6.6 Management / Franchise fees from 3rd party Management Fees from Fleur Hotels Total Management Fees hotels Q2 FY23 Q2 FY24 Fees to Lemon Tree Hotels (Rs. Cr) Q2 FY23 Q2 FY24 Growth % Ma
Slide 38: Total Management Fees | H1 FY24 vs H1 FY23
December 2023 Corporate Presentation 37 Total Management Fees | H1 FY24 vs H1 FY23 47.9 38.5 27.1 + 23.2 = 20.8 15.3 Management / Franchise fees from 3rd party Management Fees from Fleur Hotels Total Management Fees hotels H1 FY23 H1 FY24 Fees to Lemon Tree Hotels (Rs. Cr) H1 FY23 H1 FY24 Growth % M
Slide 39: Market Segments: Q2 FY24 vs Q2 FY23
December 2023 Corporate Presentation 38 Market Segments: Q2 FY24 vs Q2 FY23 Market Segments Room Nights Sold – Q2 FY24 vs Q2 FY23 44% 50 % 39% 45 % 40 % 35 % 34% 34% 30 % 25 % 20 % 15 % 7% 7% 9% 10 % 5% 6% 7% 6% 5% 2% 0% Corporate Airline Travel Trade OTA LT.com Other FITs Q2 FY23 Q2 FY24 Market Seg
Slide 40: LTH vs Industry, Y-o-Y Growth (Q2 FY24 vs Q2 FY23)
December 2023 Corporate Presentation 39 LTH vs Industry, Y-o-Y Growth (Q2 FY24 vs Q2 FY23) Gross ARR Occupancy RevPAR (Growth % vs Q2 FY23) (Growth in bps vs Q2 FY23) (Growth % vs Q2 FY23) 16% 542 16% 16% 7% -10 Industry Lemon Tree Hotels Industry Lemon Tree Hotels Industry Lemon Tree Hotels Source:
Slide 41: Lemon Tree Hotel Network Revenue – H1 FY24
December 2023 Corporate Presentation 40 Lemon Tree Hotel Network Revenue – H1 FY24 H1 FY24 vs H1 Hotel Network Revenue H1 FY24 H1 FY23 FY23 Change (Rs. Cr) (%) Owned Hotels 430 374 15% Managed and Franchised Hotels 261 217 21% Total Network Revenue 691 591 17%
Slide 42: Consolidated Profit & Loss Statement – Q2 FY24
December 2023 Corporate Presentation 41 Lemon Tree Consolidated Profit & Loss Statement – Q2 FY24 Q2 FY24 vs Q2 FY24 vs Rs. Cr Q2 FY24 Q1 FY24 Q2 FY23 Q1 FY24 Q2 FY23 Change (%) Change (%) Revenue from operations 227.2 222.3 196.7 2% 15% Other income 2.9 2.4 0.7 24% 306% Total revenue 230.1 224.6 19
Slide 43: Consolidated Profit & Loss Statement – H1 FY24
December 2023 Corporate Presentation 42 Lemon Tree Consolidated Profit & Loss Statement – H1 FY24 H1 FY24 vs Rs. Cr H1 FY24 H1 FY23 H1 FY23 Change Revenue from operations 449.5 388.8 16% Other income 5.3 1.0 443% Total Income 454.7 389.7 17% Total expenses 243.1 202.8 20% Net EBITDA 211.6 187.0 13%
Slide 44: Opened on 5th Oct 2023 – Aurika, Mumbai Sky City
December 2023 Corporate Presentation 43 OPENED ON 5TH OCT 2023 Aurika, Mumbai Sky City
Slide 45: Aurika, Mumbai Sky City | Deluxe King Room
December 2023 Corporate Presentation 44 Aurika, Mumbai Sky City | Deluxe King Room
Slide 46: Aurika, Mumbai Sky City | Deluxe King Room
December 2023 Corporate Presentation 45 Aurika, Mumbai Sky City | Deluxe King Room
Slide 47: Aurika, Mumbai Sky City | Deluxe King Room
December 2023 Corporate Presentation 46 Aurika, Mumbai Sky City | Deluxe King Room
Slide 48: Aurika, Mumbai Sky City | 'Mirasa' all day dining restaurant
December 2023 Corporate Presentation 47 Aurika, Mumbai Sky City | ‘Mirasa’ - all day dining restaurant
Slide 49: Aurika, Mumbai Sky City | Lobby
December 2023 Corporate Presentation 48 Aurika, Mumbai Sky City | Lobby
Slide 50: Lemon Tree Mountain Resort, Shimla | Representation
December 2023 Corporate Presentation 49 Lemon Tree Mountain Resort, Shimla | Representation
Slide 51: Lemon Tree Mountain Resort, Shimla | Current (Front)
December 2023 Corporate Presentation 50 Lemon Tree Mountain Resort, Shimla | Current (Front)
Slide 52: Lemon Tree Mountain Resort, Shimla | Current (Back)
December 2023 Corporate Presentation 51 Lemon Tree Mountain Resort, Shimla | Current (Back)