Lemon Tree Hotels expands footprint with new properties in Dehradun, Pench, and Nashik

Lemon Tree Hotels Limited (NSE: LEMONTREE, BSE: 541233) has stepped up its expansion strategy with three new property signings across India. The group announced agreements for Lemon Tree Hotel, Mohkampur in Dehradun; Lemon Tree Resort in Pench, Maharashtra; and Keys Select by Lemon Tree Hotels in Nashik. All three will be managed by Carnation Hotels Private Limited, its wholly owned subsidiary.

Together, these projects add over 200 rooms to the development pipeline and span different segments of hospitality: a mall-anchored business and leisure property in Dehradun, a wildlife resort in Pench, and a midscale business hotel in Nashik. The diversification underscores the company’s broader growth narrative, aligning with India’s strong post-pandemic rebound in both corporate travel and leisure tourism.

What does the new Dehradun property mean for Lemon Tree Hotels’ expansion in Uttarakhand?

The 98-room Lemon Tree Hotel, Mohkampur, Dehradun is strategically positioned within the Mall of Dehradun, the city’s leading lifestyle and retail destination. Alongside its rooms, the hotel will feature a restaurant, lounge, conference room, swimming pool, and fitness center. The location offers direct access to shopping and entertainment while being just 18 kilometres from Jolly Grant Airport and nine kilometres from the railway station.

Dehradun is one of India’s fastest-growing Tier II markets, attracting both tourists heading to Mussoorie and students attending its famed educational institutions. As the capital of Uttarakhand, it is also home to the Indian Military Academy, Forest Research Institute, and other national institutions, which generate steady business travel. By placing a property inside a major lifestyle hub, Lemon Tree Hotels is targeting discretionary spending and capturing both domestic and international visitors.

Management has indicated that this is part of a deliberate strategy to deepen its Uttarakhand portfolio. The group already operates eight hotels in the state and has eight more under development, highlighting a clear intent to establish dominance in the region.

How will the Pench resort signing reinforce Lemon Tree Hotels’ wildlife and leisure portfolio?

The 60-room Lemon Tree Resort in Pench marks another milestone in the group’s wildlife and experiential tourism expansion. The property will include a restaurant, banquet facilities, spa, swimming pool, and recreational amenities. Situated 85 kilometres from Nagpur Airport and 62 kilometres from Nagpur Railway Station, the resort will cater to both domestic wildlife enthusiasts and international tourists visiting Pench National Park.

The park’s reputation as the backdrop for Rudyard Kipling’s The Jungle Book adds global recognition value. Spread over 758 square kilometres and home to the Royal Bengal tiger, Indian leopard, jackal, hyena, and other species, the reserve is among India’s most prominent tiger habitats. The signing reinforces Lemon Tree Hotels’ growing wildlife portfolio, where it already operates five properties, while expanding its reach in Maharashtra, where it runs 14 hotels with 10 more in the pipeline.

Hospitality analysts see this diversification as a way for Lemon Tree Hotels to build resilience. While business hotels often face cyclical demand, wildlife resorts tend to attract consistent high-margin traffic from affluent travellers and foreign tourists, particularly during safari seasons.

Why is the Nashik signing important for Lemon Tree Hotels’ Maharashtra growth strategy?

Keys Select by Lemon Tree Hotels, Mhasrul, Nashik will add 50 rooms, a restaurant, and banquet facilities to the company’s portfolio. Located within reach of Nashik International Airport (16 kilometres) and the railway station (15 kilometres), the hotel sits on the Saputara-Nashik Road in an emerging industrial belt anchored by conglomerates such as Reliance Industries and Godrej.

Nashik offers a unique dual opportunity. On one hand, it is an industrial hub with a growing manufacturing base. On the other, it is a spiritual and tourism destination, hosting millions of pilgrims during the Kumbh Mela and serving as India’s wine capital with its vineyard trails. By signing a midscale business-oriented property, Lemon Tree Hotels is positioning itself to capture corporate demand while tapping into the city’s leisure inflows.

The group already operates 14 hotels in Maharashtra and has nine more under development. The Nashik signing reflects a consistent effort to consolidate its presence in one of India’s most economically significant states.

What is the broader significance of these expansions for investors and institutional sentiment?

Lemon Tree Hotels has grown rapidly since its first 49-room property in 2004, now operating more than 110 hotels across 75 cities in India and abroad. Its pipeline of over 110 upcoming projects takes the operational and signed portfolio beyond 230 properties. The brand matrix—spanning Aurika Hotels & Resorts, Lemon Tree Premier, Lemon Tree Hotels, Red Fox, Keys Prima, Keys Select, and Keys Lite—caters to diverse segments, from upper-upscale to midscale, wildlife, leisure, and spiritual.

For institutional investors, the three new signings are significant because they highlight disciplined diversification. Dehradun demonstrates its Tier II urban growth play, Pench underlines its leisure and experiential strategy, and Nashik reinforces its industrial corridor presence. This balance reduces reliance on any single demand segment, a factor analysts often cite as critical in India’s volatile hospitality sector.

Market observers note that Lemon Tree Hotels has maintained its brand strength by focusing on asset-light expansion through management contracts under Carnation Hotels. This reduces capital intensity while allowing for geographical scale, a strategy that institutional investors tend to view favourably.

How did Lemon Tree Hotels’ stock perform following the announcements, and what does it signal about investor confidence?

On August 28, 2025, following the announcement of the Dehradun property, shares of Lemon Tree Hotels on the National Stock Exchange traded at ₹127.05, down 0.20% from the previous close. On the Bombay Stock Exchange, the stock showed a similar marginal decline. Despite the minor dip, the stock has been hovering close to its 52-week highs, reflecting resilient investor sentiment.

Institutional flows suggest a mixed picture. While some investors are booking profits after the recent rally, long-term holders remain optimistic about the company’s growth trajectory. The marginal decline following the expansion announcements likely reflects short-term technical corrections rather than any deterioration in fundamentals.

Market participants highlight that asset-light signings such as these are typically positive for shareholder value, as they promise future revenue streams without significant capital outlay. With the company already serving over 1.5 million guests annually and benefiting from India’s domestic travel boom, analysts expect the stock to retain its “accumulate” bias in the medium term.

What is the future outlook for Lemon Tree Hotels as it scales across multiple segments?

The future trajectory for Lemon Tree Hotels appears anchored in sustained geographic expansion and category diversification. Industry experts believe that its strategy of balancing Tier II city business hotels with wildlife resorts and industrial corridor properties positions it to withstand cyclical shocks.

With India’s domestic tourism on the rise, increasing international arrivals, and government focus on tourism infrastructure, the group is well placed to sustain growth. Observers expect additional signings in Tier II and Tier III cities in the coming quarters, supported by management’s emphasis on scalable, asset-light growth.

For investors, the company represents one of the few listed plays on India’s mid-market hospitality boom. While competition from global players and local boutique chains remains a challenge, Lemon Tree Hotels’ pipeline of over 230 properties suggests it is on track to remain the country’s largest mid-market hotel chain.