Easy Trip Planners Limited — Q3 FY25 earnings call

Call held 14 Feb 2025

Management summary

Easy Trip Planners reported a strong Q3 FY25 with GBR of INR 2,149 crores, EBITDA of INR 51 crores (up 20.7% QoQ), and PAT of INR 34 crores (up 30% QoQ), driven by robust growth in non-air segments and international operations, particularly Dubai. The company emphasized its focus on profitable growth amidst intense competition in the air market, while addressing analyst concerns about GBR growth, promoter shareholding, and equity dilution. Strategic initiatives included expanding non-air verticals, international footprint, and corporate travel solutions, alongside the acquisition of Planet Education Australia.

Highlights

  • Q3 FY25 GBR reached INR 2,149 crores.

  • Q3 FY25 EBITDA grew 20.7% QoQ to INR 51 crores with a 33.2% margin.

  • Q3 FY25 PAT grew 30% QoQ to INR 34 crores with a 22.1% margin.

  • Hotel nights booked grew 172% YoY to 2.5 lakhs in Q3 FY25, contributing 11.1% to GBR.

  • Dubai operations showed remarkable 227% YoY growth in Q3 FY25, reaching INR 170 crores GBR.

Concerns

  • Slower GBR growth compared to competition, particularly in the India air market.

  • Analyst concerns regarding promoter stake selling and equity dilution through bonus issues.

  • Flat sequential hotel GBR in Q3 FY25 despite seasonality.

Key financials

2 periods

Q3 FY25

  • GBR
    ₹2,149 Cr
  • EBITDA
    ₹51 Cr
    QoQ +20.7%
  • EBITDA Margin
    33.2%
  • PAT
    ₹34 Cr
    QoQ +30%
  • PAT Margin
    22.1%
  • Hotel Nights Booked
    ₹2.5 lakh
    YoY +172%
  • Dubai GBR
    ₹170 Cr
    YoY +227%

9M FY25

  • GBR
    ₹6,499 Cr
  • EBITDA
    ₹144 Cr
  • EBITDA Margin
    31.3%
  • PAT
    ₹92 Cr
  • PAT Margin
    20.6%
  • Hotel Nights Booked
    ₹6.5 lakh
    YoY +73%

What they filed

Q1 FY27: revenue up 41.1%, net profit down 631.6% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue103 106 88 58 58 −44%79 −25%90 +3%81 +41%
EBITDA33 41 4 -4 -6 −118%-9 −121%-25 −736%-17 −301%
Net profit28 34 6 2 -41 −247%1 −97%-9 −243%-8 −632%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Capital allocation

high confidence
  • M&A Planet Education Australia Acquisition · Closed

    strengthens our international education portfolio and also enables us to offer dedicated student travel services

    Furthering our expansion into specialized travel services, we have entered the study tourism sector with the acquisition of Planet Education Australia. This move strengthens our international education portfolio and also enables us to offer dedicated student travel services.

Guidance & targets

Business Mix

  • Non-air business contribution to GBR Business Mix · FY26 · High confidence 25%
    So, our target is that in FY2026, we should be able to say 75% of our business came from flight and 25% business came from all other sectors, which right now is at 86%.

    — Prashant Pitti

Corporate Business

  • Corporate business growth Corporate Business · Medium confidence double digits
    We look forward to grow our corporate business, which is very minimal at the moment into double digits.

    — Prashant Pitti

What to watch in Q4 FY25

Non-air business contribution to GBR

FY26
Current 14% (Q3 FY25)
Target Progress towards 25%

Why it matters

Key strategic shift to diversify revenue streams and improve profitability.

So, our target is that in FY2026, we should be able to say 75% of our business came from flight and 25% business came from all other sectors, which right now is at 86%.

Risks & concerns

  • Competitive Intensity in Air Market

    medium

    Private players are 'burning money' to gain market share, leading to subdued growth for EMT in the India air market.

    Management acknowledged

  • Equity Dilution via Bonus Issues

    medium

    Analysts expressed concern over repeated bonus issues diluting equity and impacting share price.

    Analyst downplayed

  • Promoter Stake Selling

    medium

    Concerns raised about recent promoter stake sales and potential future selling, though management committed no further selling this year.

    Analyst addressed

  • Slower GBR Growth

    medium

    GBR growth perceived as slower compared to competition, attributed to strategic choice of profitability over growth at all costs.

    Analyst acknowledged

Q&A highlights

3 direct, 1 evasive
Competitive Intensity and GBR Growth Partial
At EaseMyTrip, we are very, very caution able in growing ourselves while remaining profitable. We took the call of reducing our discounts for this particular quarter and yet there was an increase in GBR, which we see as a positive sign.

Addresses the core concern of slower growth compared to peers, highlighting the company's strategy of prioritizing profitability over aggressive discounting.

Asked by Manik Taneja

GoAir Revival and EaseMyTrip's Involvement Direct
this is a very, very private conservation. If that happens, it will basically lead to some benefit of EaseMyTrip, but this is not with respect to EaseMyTrip. It's a decision of an individual, at the individual capacity.

Clarifies that any involvement in GoAir is a personal endeavor by Nishant Pitti and not a corporate initiative of EaseMyTrip, addressing potential conflict of interest or capital allocation concerns.

Asked by Manik Taneja

Hotel GBR Growth in Q3 FY25 Partial
So, you don't have to look for every particular quarter. You must see on the overall perspective. This particular quarter, the growth wasn't there. But the last few quarters, you would see that the growth was there. And every quarter, we must manage against profitability.

Addresses the analyst's observation of flat sequential hotel GBR despite seasonality, with management reiterating its focus on profitable growth over short-term fluctuations.

Asked by Manik Taneja

Overall GBR Growth and Future Outlook Partial
Our efforts on India air market might be subdued. And the reason is that there is a lot of competition from the private players who are in the eye of growing their airline business at the cost of losing money.

Explains the reason for muted GBR growth in the India air market, attributing it to aggressive, loss-making competition from private players, and outlines the strategy to focus on hotels and Middle East.

Asked by Bala Murali Krishna

Equity Dilution and Bonus Issues Evasive
So that was done a quarter before. It was not done in the last quarter. So, I do not think it is relevant for this quarter call. Again, you have said that it was a Board decision. And I do take your feedback into consideration.

Highlights analyst concern over repeated bonus issues leading to equity dilution, with management deferring a direct answer on future plans, indicating potential ongoing investor apprehension.

Asked by Bala Murali Krishna

Promoter Stake Selling Direct
We are trying our best to create value for ourselves and for our shareholders by the virtue of holding more than 50% of the company. And the public commitment is made that for this particular year, we will not be selling any shares. So, we would abide by that.

Addresses concerns about recent promoter stake sales and provides a commitment that no further shares will be sold by promoters in the current year, aiming to reassure investors.

Asked by Bala Murali Krishna

Nishant Pitti's Resignation as CEO and Management Gap Partial
Sir, Nishant has not resigned from the company. He has just resigned from the CEO position and Rikant is the CEO. Nishant is a very active member at EaseMyTrip. He's actually the Chairman of the company. So, there is no loss of management from our side.

Clarifies the management transition, emphasizing that Nishant Pitti remains involved as Chairman and Rikant Pitti has taken over as CEO, aiming to allay fears of a leadership vacuum.

Asked by Raghav Kapoor

Rationale for Nishant Pitti Stepping Down as CEO Direct
So firstly, Rikant is going to take care of the international operation as the CEO of the company. I'm going to take care of the international expansion of the company. For that purpose, I have to travel a lot abroad India. So that's the main reason to step down as CEO.

Provides a specific strategic reason for the CEO change, linking it to the company's focus on international expansion, which could be seen as a positive strategic realignment.

Asked by Raghav Kapoor

3 min read 7 chapters

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.

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