The IPO of online travel company Easy Trip Planners, which operates EaseMyTrip.com, opened today. The company has fixed a price band of ₹186-187 per share for its ₹510-crore initial share-sale, which closes on March 10. Ahead of the IPO, Easy Trip Planners had raised ₹229.5 crore from anchor investors ₹187 per share, including HSBC Global Investment Funds, Nomura, Tata Trustee Company, Aditya Birla Sunlife Insurance Company, Sundaram Mutual Fund, Bajaj Allianz Life Insurance Company and Nippon Life India Trustee Company.
As of 12:50 pm, the issue was 1.13 times subscribed.
The grey market premium on Easy Trip Planners shares is stable at ₹160-165, says grey-market tracker Abhay Doshi, who is the founder of UnlistedArena.com, which deals in pre-IPO and unlisted shares.
“Easy Trip Planners majority of revenue comes from Airline ticket booking. They work on differentiated model were they provide customers an option to buy tickets without convenience fees. The CAGR growth of gross booking from revenue in fiscal 2018-2020 stands to be at 47% which is highest among competitors. Covid19 pandemic has dented travel and tourism industry but bullish market sentiment and digital theme playing out, Easy Trip Planners will attract investors,” he added.
Here are 10 things to know about Easy Trip Planners IPO:
1) The share allotment in Easy Trip Planners is likely to be finalised on March 16 and shares may list on March 19, according to brokerages.
2) KFintech Private Limited is the registrar of Easy Trip Planners IPO. The lot size is 80.
3) 75% of the net issue shall be allocated on a proportionate basis to qualified institutional buyers, while rest 15% and 10% is reserved for non-institutional bidders and retail investors, respectively.
4) Easy Trip Planners IPO is entirely an offer for sale. Founders Nishant Pitti and Rikant Pitti, who hold more than 49% stake each, will each sell shares to the tune of ₹255 crore each.
5) Easy Trip Planners said the objective of the issue is to get benefit of listing the shares on the stock exchanges, which will further enhance its visibility and brand and also provide liquidity for the existing shareholders.
6) The company’s issue is being managed by Axis Capital and JM Financial.
7) Founded in 2008, Easy Trip Planner offers a range of travel-related products and services catering to the needs of passengers traveling domestically, as well as traveling to and from international destinations. Its businesses are organized primarily in following segments: airline tickets, hotels and holiday packages and other travel services like rail tickets, bus tickets, taxi rentals and ancillary value added services such as travel insurance, visa processing.
8) “The company has 4.6% market share in Indian OTA market as on FY2020. EaseMyTrip’s top line increased by 47% CAGR in FY2018-FY2020. It is the only profitable company among peers. The company’s cash & cash equivalent stood at ₹141 crore as on December 2020. Its ROE and ROCE stood at 39.5% and 58.5% as on FY2020. EaseMyTrip is also looking for expansion across Singapore, UAE and UK. We believe that the stock is fairly priced and has a good upside potential in the long term. One may subscribe to the IPO for listing as well as long term gains,” said Canara Bank Securities.
9) The risk factors include impact of COVID-19 pandemic on the business, dependency on airline ticketing business and severe competition across the industry, the brokerage said.
10) “At the higher price band of ₹187 per share, Easy Trip Planners Ltd is valued at 25.5X FY23 earnings. We recommend a subscribe,” Ventura Securities said in a note.