Lemon Tree Hotel Reports Positive Financial Performance in Q2 FY24-25 Despite 'Strong Sell' Call

Lemon Tree Hotels, a midcap company in the hotel, resort, and restaurant industry, has recently announced its financial results for the quarter ending September 2024. The company's stock has been given a 'Strong Sell' call by MarketsMOJO.

Despite this, Lemon Tree Hotel has shown positive financial performance in Q2 FY24-25, with a score improvement from 4 to 16 in the last 3 months. This can be attributed to several factors, as seen in the September 2024 financials.

One of the key highlights is the company's strong operating cash flow, which has been consistently growing each year for the past three years and is currently at its highest at Rs 465.01 crore. This indicates that Lemon Tree Hotel has been able to generate higher cash revenues from its business operations.

In terms of sales, the company has also shown a positive trend with a 25.16% year-on-year growth in net sales for the quarter, amounting to Rs 284.37 crore. This is a promising sign for the near future.

Similarly, Lemon Tree Hotel has also seen a positive trend in its Profit Before Tax less Other Income (PBT) and Profit After Tax (PAT), with a 39.45% and 30.9% year-on-year growth respectively. This indicates that the company's profitability is on the rise.

Another positive aspect is the company's debt-equity ratio, which is currently at its lowest in the last five half-yearly periods at 2.23 times. This shows that Lemon Tree Hotel has been reducing its borrowing in comparison to its equity capital.

Furthermore, the company has also been able to settle its debtors faster, with a debtors turnover ratio of 16.10 times in the last five half-yearly periods. This is the highest it has been, indicating efficient management of its debtors.

Overall, Lemon Tree Hotel has shown a strong financial performance in the quarter ending September 2024, with positive trends in key areas. However, it is important to note that MarketsMOJO has given a 'Strong Sell' call for the company's stock, and investors should carefully consider this before making any investment decisions.