Lemon Tree Hotels, hereafter Lemon Tree, is preparing to intensify its overseas expansion over the next three to five years as outbound travel from India grows. The company is positioning its midscale offering to follow demand from Indian leisure travellers, citing projections that India will become the fourth-largest outbound tourism market by 2035, rising from 10th place according to Capital Economics. The strategy reflects an expectation of sustained growth in overseas leisure travel by Indians.

Lemon Tree has identified destinations such as Thailand, Vietnam and Singapore as natural fits for its brand as it tracks traveller flows. The group currently operates five hotels outside India, with two in Nepal and Bhutan and one in the UAE, part of a portfolio that exceeds 120 properties. The chain is positioning its services and distribution for international guests while continuing to grow domestically.

The company owns brands including Aurika, Red Fox and Keys Select and is the third-biggest homegrown hotel chain by number of rooms. It sits behind Indian Hotels, owner of the Ginger brand, and ITC Hotels, which runs the Fortune and Welcomhotel brands. Lemon Tree reports a significant development pipeline and says India will remain its primary market as it pursues selective international openings.

Company executives stress that overseas growth is a mid-term objective and that the firm intends to adhere to its strategy amid regional geopolitical tensions. At home, Lemon Tree is exploring a largely franchise-led model to bring unbranded hotels into its system and tap an independent segment that the industry estimates is about half unbranded. In January the group announced it would transfer hotel ownership to a subsidiary, Fleur, and become a fully asset-light operator, creating two publicly traded entities within 12 to 15 months.