Detailed Narrative
Q3 FY25 Financial Performance Overview
Easy Trip Planners reported a robust Q3 FY25, with Gross Booking Revenue (GBR) reaching INR 2,149 crores. The company's EBITDA stood at INR 51 crores, marking a 20.7% quarter-on-quarter growth and achieving a margin of 33.2%. Profit After Tax (PAT) also saw significant growth, increasing 30% quarter-on-quarter to INR 34 crores, with a margin of 22.1%. For the first nine months of FY25, GBR was INR 6,499 crores, EBITDA INR 144 crores (31.3% margin), and PAT INR 92 crores (20.6% margin).
Diversification into Non-Air Segments
The company continued its strategic focus on diversifying beyond air travel. Hotel nights booked in Q3 FY25 surged by 172% year-on-year to 2.5 lakhs, contributing 11.1% to the total GBR. For the nine-month period, hotel nights grew 73% year-on-year to 6.5 lakhs, representing 10.6% of GBR. Bookings in the train, bus, and other categories also increased by 31.9% year-on-year in Q3 FY25 to 3.6 lakh, contributing 2% to GBR, with 9.5 lakh bookings for 9M FY25 (23% YoY growth). Management aims for non-air segments to constitute 25% of business by FY26, up from the current 14%.
International Expansion and Dubai Operations
International operations, particularly in Dubai, demonstrated exceptional growth. Dubai's gross booking revenue reached INR 170 crores in Q3 FY25, reflecting a remarkable 227% year-on-year growth. Management views the Middle East as a unique and sustainable growth opportunity, with significant potential yet to be tapped. The company also received GoGlobal accreditation from IATA, reinforcing its international presence and credibility amongst global airlines partners.
Competitive Landscape and Profitability Strategy
Amidst intense competition, especially in the India air market, Easy Trip Planners emphasized its strategy of prioritizing profitable growth over aggressive discounting. The company reduced its discounts from 3.8% to 3% in Q3 FY25, which still resulted in increased GBR and improved margins. Management noted that some private players are 'burning money' to gain market share, a strategy Easy Trip Planners avoids to maintain long-term sustainability and profitability.
Strategic Initiatives and Partnerships
The company undertook several strategic initiatives, including expanding its offline franchisee model with new stores in multiple cities and inaugurating a new Mumbai office. Partnerships with BNZ Green were established for real-time carbon footprint tracking, and with OLX India to integrate a travel booking section on their platform, reaching 35 million monthly users. The Winter Carnival sale and collaboration with CARS24 were also launched to enhance customer engagement.
Acquisition and Management Transition
Easy Trip Planners acquired Planet Education Australia, marking its entry into the study tourism sector to strengthen its international education portfolio and offer dedicated student travel services. In a management transition, Nishant Pitti stepped down as CEO to focus on international expansion but remains Chairman, with Rikant Pitti assuming the CEO role. This change was attributed to strategic realignment for international growth, ensuring no loss of management expertise.
Shareholder Concerns and Management Response
Analysts raised concerns regarding the company's GBR growth relative to competitors, repeated equity dilution through bonus issues, and recent promoter stake selling. Management acknowledged the feedback on equity dilution and committed that promoters would not sell any further shares in the current year. They reiterated their focus on profitable growth and the long-term value creation, with promoters maintaining over 50% ownership.