READ THE FULL YTRA RESEARCH REPORT
Yatra Online (NASDAQ:YTRA) rebounded 51% in 2022 as India slowly reopened to travel despite fighting fits and starts around the globe. With the pandemic finally in retreat and governments slowly returning to normal, Yatra should benefit greatly in its FY2023. In fact, it expects not only to return to pre-pandemic levels but surpass them as market share gains are evidenced. It is entirely feasible that the company doubles revenues this year and returns to profitability by FYQ2 (September).
For the year, adjusted revenue from air ticketing increased of 48.6%, adjusted revenue from hotels and packages rose 70.9%. Total gross bookings (air ticketing, hotels, packages and others) were US$451.9 million up from US$208.5 million in FY2021 (up 116%). The loss for year declined dramatically to US$6.4 million versus a loss US$ 15.7 million in the year ago period. The company also returned to positive adjusted EBITDA reporting US$2.1 million versus a loss of US$5.0 million last year.
FYQ4 Ending March 31, 2022
March quarter revenue was hurt early in the quarter as Omicron caused restricted travel in January but business bounced back by March. Management indicated both business travel and consumer travel is now at 90% of its pre-covid volumes and it expects to surpass pre-covid volumes as Yatra has picked up market share in the interim. The June quarter is seasonally the highest for Yatra and we expect the company may return to profitability even then. It has already shown two quarter of positive EBITDA and cash flow from operations net of working capital.
Adjusted revenues were $12.9 million versus $13.3 million a year ago. Air passenger travel declined 10% for Yatra in the March quarter, but hotel room nights increased 8%. Holiday packages increased from 2,000 last year to 4,000 this year, flat with Q3 2022. The company had adjusted EBITDA of $697,000 for the quarter an improvement over FYQ3, despite investing the freight forwarding service and logistics and having sequentially down revenues. Yatra was also cash flow positive and free cash flow positive. Traffic numbers were down in the March quarter from the December quarter as shown in the graph below:
The March quarter traffic number was 24.7 of versus 30.5 in the December quarter. So far the June quarter looks to be better than the December quarter if April is the low.
We value YTRA using a peer comparables valuation methodology based on EV/Sales for 2022 calendar estimates. The average multiple for this group is 3.7 times. Using that number and an estimate of calendar year sales for Yatra in 2022 of US$73.3 million we calculate an enterprise value of $271 million, a market value of $284 million and a stock price of $4.10 per share using 62.5 million shares outstanding and putting a 10% discount for microcap size, single country risk and corporate governance.
SUBSCRIBE TO ZACKS SMALL CAP RESEARCH to receive our articles and reports emailed directly to you each morning. Please visit our website for additional information on Zacks SCR.
DISCLOSURE: Zacks SCR has received compensation from the issuer directly, from an investment manager, or from an investor relations consulting firm, engaged by the issuer, for providing research coverage for a period of no less than one year. Research articles, as seen here, are part of the service Zacks SCR provides and Zacks SCR receives quarterly payments totaling a maximum fee of up to $40,000 annually for these services provided to or regarding the issuer. Full Disclaimer HERE.
