Will Easy Trip Planners make a stellar debut on March 19? Check what grey market signals

The public issue was a complete offer for sale (OFS) by its promoters Nishant Pitti and Rikant Pitti, who sold shares worth Rs 255 crore each through the offer.

Online travel agency Easy Trip Planners is expected to debut at a 50 percent premium on the bourses on March 19 and the maximum listing premium could be around 80-90 percent, say, experts.

This would be the 10th stock listing of the calendar year 2021, after Indian Railway Finance Corporation, Indigo Paints, Home First Finance Company, Stove Kraft, Brookfield India REIT, Nureca, RailTel Corporation, Heranba Industries, and MTAR Technologies.

Easy Trip Planners shares traded at more than 80 percent premium in the grey market. As per the IPO Watch data, the current premium stood at Rs 150 – Rs 160, taking the trading price to Rs 337-Rs 347 against the final issue price of Rs 187 per share.

The grey market is an unofficial trading setup, where a company’s shares are bid and offered by traders unofficially before the stock gets listed on the exchanges after the company’s IPO.

The Rs 510-crore public issue witnessed a subscription of 159.33 times during March 8-10, 2021. Retail and qualified institutional investors’ quotas were subscribed more than 70 times each.

Experts feel the expected massive listing premium is largely on the back of the company’s strong fundamentals as it is the only profitable online travel agency.

“With investors’ enthusiasm in the primary market and high liquidity for primary issues, Easy Trip Planners offer saw remarkable demand on the last day of bidding from the non-institutional investors who have put in 382 times more bids than their reserved portion. Looking at the strong subscription demand, one can expect a bumper listing with a minimum 80-90 percent premium on the issue price of Rs 187,” Prashanth Tape, AVP Research at Mehta Equities told Moneycontrol.

The reason for such a strong premium can be contributed to the only profitable online travel agency (OTA) in India followed by a highly scalable asset-light digital business model, he said.

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Easy Trip Planners was the only profitable online travel agency among the key online travel agencies in India in FY18, FY19, and FY20, in terms of net profit margin. Its market share in the total Indian online travel agency industry in terms of gross booking revenues was approximately 4.6 percent in FY20.

The company has outperformed the industry by recording a growth of 37.31 percent in gross booking revenue from airline tickets in the B2C channel in FY20.

Astha Jain, the Senior Research Analyst at Hem Securities, expects Easy Trip to list at more than 50 percent premium to issue price, while Yash Gupta, Equity Research Associate at Angel Broking, expects a very good listing premium of 60-70 percent over the issue price.

The public issue was a complete offer for sale (OFS) by its promoters Nishant Pitti and Rikant Pitti, who sold shares worth Rs 255 crore each through the offer.

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