Easy Trip Planners trades at a 10% premium, what should you do?

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Share of Delhi-based Easy Trip Planners opened for trading at Rs 212.25 on the National Stock Exchange, compared to the issue price of Rs 187, marking a premium of 13.50%. On the BSE, Easy Trip Planners opened at Rs 206, at a premium of 10.16%.

Easy Trip share price soared after listing and made a high of Rs 233.15 on the BSE. In afternoon trades it was quoting in line with the listing price at Rs 205.88 on the BSE. So what should be the strategy now?

“Investors should consider booking profit on Easy Trip Planners Ltd IPO. The issue price of Rs.187 implies a P/E of 61.51x based on FY20 EPS. Considering the gain on listing, the valuation gets stretched and room for upside is limited. Investors to take profit post listing,” said Saurabh Joshi – Equity Analyst at Marwadi Shares and Finance.

Easy Trip Planners through its online platform EaseMyTrip.com offers a comprehensive range of travel-related products and services for end-to-end travel solutions, including airline tickets, hotels and holiday packages, rail tickets, bus tickets and taxis as well as ancillary value-added services such as travel insurance, visa processing and tickets for activities and attractions.

The company has been consistently profitable since incorporation, and according to the CRISIL report, it was the only profitable online travel agency among the key online travel agencies in India during FY18-FY20, in terms of net profit margin.

“I think soured secondary markets sentiments weighed on the listing. As the sentiments improve, will see buying interest in Easy Trip. Investors who are allotted should stay put. And those who want to buy should buy in tranches,” says Saurabh Jain, ‎Assistant Vice President of SMC

While Astha Jain of Hem Securities suggested booking partial profit n hold remaining with a long term view.

The Rs 510 crore public issue received bids for 239 crore shares against 1.50 crore shares on offer, according to the stock exchange data. The issue was subscribed 159.96 times. The portion meant for qualified institutional buyers (QIBs) was subscribed 77.95 times so far, while those for non-institutional investors 384.26 times and retail individual investors (RIIs) 69.54 times.

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