Shares of Easy Trip Planners Ltd listed at Rs 206 apiece on the BSE on Friday, nearly 10 per cent premium over its issue price. After its listing, the scrip hit Rs 233.15, which is nearly 25 per cent higher than its issue price of Rs 187 per share.

The company’s Rs 510 crore issue was subscribed more than 160 times last week. The retail investors’ portion was subscribed 70.78 times, while the non-institutional investor’s portion was subscribed 384.26 times. The institutional investor’s portion witnessed a subscription of 77.95 times. The IPO comprised an offer for sale of Rs 255 crore each by promoters Nishant Pitti and Rikant Pitti, who held 49.81per cent and 49.68 per cent stake, respectively, in the company. The company offers a comprehensive range of travel-related products and services for end-to-end travel solutions, including airline tickets, hotels and holiday packages, rail tickets, bus tickets, and taxis as well as ancillary value-added services such as travel insurance, visa processing, and tickets for activities and attractions.

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Easy Trip Planners earns 94 per cent of its revenue from airline tickets booked by customers from its platforms in the form of commissions and incentives. The company said in its draft red herring prospectus or DRHP that due to covid-19 pandemic outbreak, its businesses, results of operation, financial positions and cash flows were materially and adversely affected.

Domestic and international travel restrictions imposed in India also disrupted its revenue lines. Such restrictions have continued for the greater part of the nine months ended December 2020 with only some domestic travel and government-approved international travel operations commencing in June 2020. Gross booking revenues decreased from Rs 3179.80 crore in the nine months ended December 2019 to Rs 1220.76 crore in the nine months ended December 2020.

For nine month ended December 2020, the company posted a revenue of Rs 49.25 crore, down 65 per cent from a year ago. Net profit fell 10.21 per cent to Rs 31.11 crore against Rs 34.65 last year same period. Net debt for the period stood at Rs 85.24 crore. Given the only profitable online travel agency among the key online travel agencies in India, strong operations and financial performance in highly competitive and growing industry many analysts have given subscribe rating to this IPO.

“We like ETPL given its lean business model, differentiated offering, and strong customer connect. However, the travel industry which was significantly impacted due to Covid-19 is likely to take a much longer time to revive; though recovery is visible and vaccination drive would further propel it. The issue is valued at 49.9x FY21E P/E on an annualized basis. Being the first in the segment to get listed in India, ETPL could generate high investor interest”, said Motilal Oswal in a note to its investors.

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Easy Trip Planners Ltd-View Detailed Analysis