Easy Trip Planners IPO was oversubscribed on Monday, the first day of bidding, led by retail investors. The issue opened on Monday, March 8 and closes on Wednesday, March 10, 2021. The price band has been fixed at Rs 186 -187 per share.Commenting on the IPO, Prashanth Tapse, AVP Research Head, Mehta Equities, said, "We believe Easy Trip Planners (ETP) IPO gives investors an opportunity to invest in a digital high-growth travel business that is into travel-related end-to-end solutions services and the only profitable online travel agency (OTA) in India. Looking at the high growing domestic & foreign tourism opportunity and supportive Govt initiatives like eVisa and UDAN scheme developing airports in Tier2-3 cities which will directly provide industry growth helping online business avenues where ETP is well placed to tap the opportunity in the Indian online travel agency industry.On valuations parse, we feel the strength of Easy Trip Planners brand, Scalable asset-light business model, High digitalization growth in online business, Customer-centric approach, as well as company efficiency in maintaining sustainable profitability justifies high P/E of (annualized FY21) ~49x, P/BV at ~11.53x times and at the upper price band (Rs 187/-), the issue is asking for a market cap of Rs 20320 million. Along with rationales to invest the offer also comes with some risk which includes its high dependence on airline ticketing business (98%) which has high cut-throat competition from established and emerging players and 2nd risk is in the objective of the issue which will provide 100% exit liquidity for the existing investors via Offer For Sale (OFS) route and IPO investors should know that ETP will not be getting any funds raised through the IPO process and the general concern that travel & tourism sector has been hit by the Covid-19 pandemic last year and could see muted growth for the next 6-12 months going forward.
Hence, based on all the above factors we advise investors to "SUBSCRIBE" this IPO with a long-term perspective as well as a high potential candidate to generate healthy listing gains as markets always reward a player who has high growth potential."Easy Trip Planners (ETP) was incorporated on June 4, 2008. It offers a comprehensive range of travel-related products and services for end-to-end travel solutions. ETP is ranked 2nd among the Key Online Travel Agencies in India in terms of booking volume in the 9 months ended December 31, 2020 and 3rd among the Key Online Travel Agencies in India in terms of gross booking revenues in Fiscal 2020. As of Dec. 31, 2020, they provided their customers with access to more than 400 international and domestic airlines, more than 1,096,400 hotels in India and international jurisdictions, almost all the railway stations in India as well as bus tickets and taxi rentals for major cities in India. In addition, 59,274 travel agents registered with them.
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