Buy Imagicaaworld Entertainment target of Rs 110 Prabhudas Lilladher

Prabhudas Lilladher's research report on Imagicaaworld Entertainment

While our FY26E EBITDA estimate remains intact, we cut our FY25E/FY27E estimates by 3%/5% amid revision in park opening timelines at Indore and Ahmedabad. Imagicaaworld Entertainment Ltd (IEL) reported subdued performance in a seasonally weak quarter with EBITDA loss of Rs38mn (PLe Rs10mn). However, we expect sharp recovery in 2HFY25E aided by 1) addition of 8 new rides at Lonavala, 2) launch of 2 new shows at Sai Teerth and 3) inauguration of a new trampoline park at Khopoli with 15+ new attractions. We believe IEL is on a strong growth path led by the consolidation of promoterowned parks at Lonavala & Shirdi, while organic growth will be driven by the launch of a new park in Indore by 4QFY25E and another one in Ahmedabad by 2HFY27E. We expect sales/EBITDA CAGR of 12.9%%/15.6% over FY25E-FY27E.

Outlook

We retain ‘BUY’ on the stock with an SOTP-based TP of Rs110 valuing the park/hotel business at EV/EBITDA multiple of 23x/21x (no change in target multiple).