At the issue price, the stock was valued at 58.7 times FY20 earnings and 49 times FY21 earnings on an annualised basis.
The Rs 510 crore issue, which had been sold between March 8 and 10, was a big hit among investors, receiving a whopping 159.33 times bids. The scrip was trading at a premium of Rs 150-155 in the grey market, the unofficial market for trading in unlisted shares.
A travel company, Easy Trip Planners was ranked second among the key online travel agencies in India in terms of booking volume in the nine months ended December 31, 2020. The company was the only profitable online travel agency among the key online travel agencies in India during FY18-20 in terms of net profit margin.
The company has access to 400 international and domestic flights and around 11 lakh hotels in India and abroad. It has 96 lakh registered customers and a network of close to 60,000 travel agents.
Nearly 90 per cent of the company’s revenue comes from the sale of air tickets while booking of hotel rooms brings in the rest. The company has tie-ups with most domestic airlines and 23 hotel aggregators. These tie-ups allow the firm to provide attractive deals to travellers. It does not charge a convenience fee from customers for ticket booking.
However, analysts say the company’s financial performance at operating level has been inconsistent, considering its market positioning among the key online travel agencies (OTAs), but feel it has a scalable business model, business growth in excess of the sectoral average and solid cash generation capability.
