Easy Trip offering is one of the few from India’s fledgling e-commerce space and the travel industry, which was badly bruised by the covid-19 pandemic.
“Considering the stringent lockdowns last year, EaseMyTrip was the least impacted among its peers and it has already recovered 70 per cent in terms of booking volumes as of Q3FY21 compared to Makemytrip’s 46 per cent and Yatra’s 44 per cent. However, it faces certain risks such as the commercial lawsuit by MakeMy Trip for its brand name, re-lockdowns if Covid-19 intensifies and premium valuation of 61.5x P/E. Being debt free with a strong ROE and ROCE of over 35 per cent does make EaseMy Trip a good listing gains candidate but investors must be careful given the frothy nature of markets
and the industry risks the travel industry entails given the current situation,”said Nirali Shah, Head of Equity Research, Samco Securities.
The company’s easemytrip portal has gain popularity thanks to its unique business model where it gives the no-convenience fee option to customers not opting for any other promotion.
“It is the only player among the key online travel agencies (OTA) in India which has been consistently earning profits. Being 100 per cent bootstrapped, cost efficiency is in the DNA of the company and that has enabled them to manage profitability better than peers. At the higher price band of Rs 187 per share, Easy Trip Planners is valued at 25.5 times its estimated FY23 earnings. We recommend a subscribe,” said broking firm Ventura in a note.
Easy Trip’s IPO closes on Wednesday.
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