Dolat Capital recommended accumulate rating on Wonderla Holidays with a target price of Rs 320 in its research report dated January 29, 2019.
Dolat Capital's research report on Wonderla Holidays
Wonderla exhibited healthy performance during Q3FY19. Revenue grew 19.1% YoY driven by 10.5% YoY growth in footfalls and 8.7% growth in ARPU. Kochi park witnessed strong revival in revenue and footfalls post disappointing performance in Q2 due to floods. Bangalore and Hyderabad parks demonstrated robust +31.5%/+21.8% revenue growth due to shift of festive season to Q3 from Q2 in FY18. Going ahead, we believe that footfalls are likely to increase due to calibrated pricing, increase in marketing/promotions and tie up with online portals. Further, Bangalore and Hyderabad park would report strong growth on a favorable base. In addition, expected improvement in the overall economy and changing macros should help Wonderla to post higher growth in the ensuing quarters.
We have revised our estimates to factor in Q3 performance and introduced FY21 EPS at ` 12.7. Valuing at 12x FY20E EV/EBITDA to arrive at a TP of ` 320. Maintain Accumulate.
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