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ICICI Direct IPO report on DreamFolks Services

DreamFolks is a dominant player and India's largest airport service aggregator platform having a unique, asset light, capital efficient business model. DreamFolks' provides services to all the card networks operating in India including Visa, MasterCard, Diners/Discover and RuPay and many of India's prominent card issuers including ICICI Bank, Axis Bank, Kotak Mahindra Bank, HDFC Bank and SBI Cards. DreamFolks has 50 clients as of March 2022. It has a global footprint extending to 1,416 touchpoints in 121 countries across the world out of which 244 touchpoints are in India and 1,172 touchpoints overseas. With 100% coverage across all 54 airport lounges operational in India, DreamFolks has gained market share of over 95% of all India issued card based access to domestic lounges in India. In FY22, DreamFolks facilitated access to 35.3 lakh out of 52 lakh passengers accessing lounges in India (i.e. ~68% total share).

Valuation and Outlook

The company enjoys over 95% market share) in card based lounge access with its asset light business model. While valuation based on FY22 look stretched, the full business recovery will be visible from FY23. Given the monopolistic nature of business and further growth potential in the air travel and credit card segment, we recommend SUBSCRIBE to this issue for listing gains.

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