Wonderla hopes to grow topline by 20-25% in this fiscal year

Infosys founder Narayana Murthy’s investment company Catamaran Capital has bought 0.77 percent equity in amusement park operator Wonderla taking its shareholding in the amusement park operator to about 1-1.5 percent, the managment has said. Catamaran Capital has bought 4.37 lakh shares at Rs 386.50 apiece. Both the companies are in talks and Wonderla is open for more such deals, said Arun K Chittilappilly, Managing Director of Wonderla Holiday.

The company operates amusement parks in Bengaluru, Hyderabad and Kochi and is targeting expanding in 4-5 new markets in the next few years, he said. The company hopes to clock a 20-25 percent topline growth in FY17, he said.

Chittilappilly said that while Bengaluru and Hyderabad operations are doing well in terms of revenue and footfall, Kochi saw a 7-8 percent drop in footfall owing to factors like service tax that came in last year. He, however, said business from the other two centres would offset the footfall drop in Kochi and it won’t give a revenue guidance for FY17.Below is the transcript of Arun K Chittilappilly’s interview with Nigel D’souza and Reema Tendulkar on CNBC-TV18.Nigel: In Friday’s trading session, the markets were sulking, but there was a big investor, Mr Narayana Murthy’s Catamaran Capital decided to go ahead and chip into your company. Before we get to how exactly business is functioning, any word coming in from the great man itself? Have you had any interaction about his outlook on the company, his vision going ahead?A: I have not really had the pleasure of meeting him yet, but I have met all his top advisors and his investment team and they have been talking to us for the last year or so and they are very happy to have them on board as an investor.Reema: What is the current holding because as per the 4.37 lakh shares, it only turns out to be about 0.77 percent of equity. Are they looking to increase it further? Have they given you any indication?A: No, not really. That is not in our realm as yet. I mean there are some investors who once they reach their price points, they want to exit and we do not really get involved in that, but they have been talking to us for a while and I am glad, that is all I can say about it.Reema: And their only holding is 0.77 percent?A: I think they have done another investment some time back, so they already have some investment in the company and this is just an add on to that. Reema: So, what would be the total holding by Catamaran Capital?A: Between 1 and 1.5 percent.Nigel: Could you give us an update in terms of footfalls at all your three parks, Hyderabad, Kochi as well as Bengaluru. We are more than two months in fact, in this quarter so how did the first quarter shape up? Could you give us some numbers?A: Kochi and Hyderabad have really done okay. Bengaluru and Hyderabad especially has done well. But in terms of Kochi we are seeing a drop in footfalls. We have a slight challenge there in terms of new offerings and things like that, so that might take about another year before we can correct that. We have done some surveys to figure why footfalls are not growing there and we have come up with some issues that we need to address. Kochi is also our oldest park, so we have already been there for more than 15-16 years now, so it needs a bit of a revamp. So, that could be one of the reasons.Hyderabad and Bengaluru have done well. We are projecting roughly 20-25 percent growth in topline this year and we should be able to manage that. So, that is what we are hoping for the year.Reema: What is the extent of drop in the Kochi footfalls?A: Right it has seen about a 7-8 percent drop, but I do not know how it will shape up for the rest of the quarter, for the rest of the year especially. But you should also remember that service tax impact came last year in June and so, it is natural for us to see that impact even in for example, Bengaluru and Kochi as well. So, June onwards we will have more comparison.Reema: What percentage of your overall footfalls come in from Kochi and on account of the decline we have seen so far, at least at the start of the year, will it affect your overall FY17 footfall guidance and what would it be?A: No, there will not be a significant change even if Kochi footfalls drop a little bit, it is okay, because Kochi also our average ticket prices is the lowest there, so the impact on overall revenues and profitability will be small. And if one of the other parks does a little more, it will automatically compensate for that. That is one of the reasons why we want to spread ourselves to the other cities, because it is always better to be in many markets. So, our goal as a company is to de-risk that from being in couple of markets to going to maybe 4-5 markets in the next few years. So, that is the strategy that we have taken and for the year, we are projecting a roughly 20-25 percent growth in revenues which we should be able to manage.