Sharekhan's research report on Wonderla Holidays
Wonderla Holidays Limited (WHL) posted a strong performance in a seasonally weak quarter by registering footfalls of 4.7 lakh as against 3.57 footfalls achieved in Q2FY2020. Revenues grew by 3.8x y-o-y to Rs. 66 crore, while EBIDTA and PAT stood at Rs. 19.4 crore and Rs. 10.5 crore. Average revenue per user (ARPU) grew by 61% compared to Q2FY2020 to Rs. 1,321. Resort also witnessed strong recovery, with the occupancy ratio standing at 76%. In the medium term (2-3 years), the company expects footfalls to be higher by 1.5x, ~7% annual growth in ARPU and two additional parks to be operational, which will aid in strong revenue growth coupled with improved profitability.
With better business fundamentals and a lean balance sheet, WHL is well-placed to achieve good earnings growth in the medium term. We maintain Buy with an unchanged PT of Rs. 425.
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