With around two decades of consistent growth, India’s Lemon Tree Hotels has built itself a strong position in the country’s mid market hospitality space.
Today, Lemon Tree has more than 110 hotels open across India, with more than 100 further properties signed into a strong development pipeline. Across India, it has a presence in major gateway cities such as Delhi, Mumbai, Kolkata and Chennai, as well as most tier 2 and many tier 3 cities. The group has also expanded internationally, establishing its first properties in Bhutan, Dubai and Nepal.
A portfolio of India-oriented brands
The group operates seven brands, each designed to appeal to a specific demographic. These include Aurika Hotels & Resorts, Lemon Tree Premier, Lemon Tree Hotels, Red Fox Hotels, Keys Prima, Keys Select and Keys Lite.
Within the last three years, Lemon Tree started a strategic shift, towards growth on an asset-light basis. Rather than developing its own properties, which takes time and a considerable financial commitment, it took to following a route successfully exploited by international groups such as Marriott, Hilton and IHG. It is now looking to sign hotels to its Lemon Tree brands, but leave the properties in the ownership of third parties.
The difference this change has made to the business is significant, according to a recent report published by the Financial Express in India. This noted that, in the first quarter of its current financial year, Lemon Tree signed 14 new management contracts, adding 1,273 rooms to its pipeline of planned openings. At the same time, the company opened five managed hotels, with close to 400 rooms. As of today, almost all of its 7,770 pipeline rooms are coming to market under the asset-light route.
Lemon Tree retains many of the hotels it previously developed. It is part way through an ambitious refurbishment programme, refreshing around 4,300 rooms in its hotels across India. The results will be seen in improved room rates, with some properties being repositioned under new, higher market segment branding.
Planning a corporate split
The group already has one operating subsidiary, Carnation Hotels Private, which manages many Lemon Tree properties. For the future, there are plans to split out the hotel assets under a new vehicle, to be named Fleur Hotels, while the operational business will remain as Lemon Tree. This will clarify the options for investors, who prefer to see the real estate assets set up in an arms length vehicle.
Recent signings for the group during 2025 have included Lemon Tree Suites, in the holy city of Nashik, a 135 room property in Maharashtra; and a Lemon Tree Premier in Surat, Gujarat. Also in June 2025, the group signed a Keys Lite property in Kharar, Punjab which will operate under a franchise agreement. And in Itanagar, Arunachal Pradesh, a Lemon Tree hotel was signed, adding 70 rooms to the brand’s portfolio.
