Lemon Tree Hotels Reports Strong Profit Growth Amid Debt Concerns and Technical Shift

Lemon Tree Hotels, a midcap player in the Hotels & Resorts industry, has recently undergone an adjustment in its evaluation. This revision reflects a shift in the technical landscape surrounding the stock, indicating a transition in its technical trend.
The company has reported a notable growth in net profit of 29.27% for the quarter ending March 2025, contributing to a positive financial performance over the last three consecutive quarters. Key metrics such as operating profit to interest have reached a high of 4.32 times, while profit before tax (PBT) less other income has grown to Rs 121.37 crore, marking a significant increase of 42.50%. Additionally, net sales have peaked at Rs 378.52 crore.

Despite these positive indicators, Lemon Tree Hotels faces challenges with high debt levels and a relatively low return on equity of 6.09%. The company's debt-to-equity ratio remains a concern, and while it has shown a historical annual growth rate of 13.95% in net sales over the past five years, the overall long-term growth outlook appears constrained.

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