Sharekhan has given Buy recommendation for Wonderla Holidays with a target price of Rs. 425 in its research report issued on Aug 12, 2022

Sharekhan’s research report on Wonderla Holidays

Wonderla Holidays Limited (WHL) posted a robust quarter registering record high quarterly footfalls of 11.18 lakhs in Q1FY2023, which led to strong 34.3x y-o-y growth in revenue to Rs. 149.4 crore, while EBITDA and PAT came in at Rs. 91.3 crore and Rs. 64.4 crore, respectively, against a loss in Q1FY2022 (driven by better operating leverage). Average revenue per user (ARPU) grew by ~10% y-o-y while resort revenue was up by 28% over Q1FY2020. The resort reported highest ever occupancies of 80%. WHL is focusing on various measures to increase footfalls including opening new parks, adding more attractions to existing parks, organising events in parks, spending on digital marketing and launching attractive offers. All these measures will aid in strong revenue growth coupled with improved profitability in the coming quarters.

Outlook

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 a revised PT of Rs.425.

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