Yatra lists at 10% discount; Should you hold or exit-

Yatra lists at 10% discount; Should you hold or exit?

Yatra Online shares listed at 10.21% discount over IPO price on bourses today. The share debuted at Rs 127.50 on the NSE, as compared to the issue price of Rs 142.

“The YOL’s shares witnessed a negative listing. This is likely due to the company’s high P/E valuation, its reliance on the airline ticketing business, and the competitive nature of the travel industry. Overall, YOL is a risky investment, and investors who receive an allotment of this IPO should consider exiting their position,” said Shivani Nyati, Head of Wealth, Swastika Investmart.

Yatra Online IPO opened for public subscription on Friday, September 15, 2023 and closed on Wednesday, September 20, 2023. The price band for its public issue at Rs 135-142 per equity share of face value Rs 1 each. The IPO comprised a fresh issue of 42,394,366 shares aggregating up to Rs 602 crore and an offer-for-sale (OFS), with promoters offloading 12,183,099 shares aggregating up to Rs 173 crore.

The IPO was subscribed 1.66 times. The portion for non-institutional investors received a 0.43-time subscription, Qualified institutional buyers 2.10 times and the Retail Individual Investors (RIIs) quota was subscribed 2.19 times.

Meanwhile, Narendra Solanki, Head Fundamental Research – Investment Services, Anand Rathi Shares and Stock Brokers, believes that, “The stock listed with discount due to decent profitability and weaker sentiments in market. However, investors who got the allotment for Yatra online could hold their shares for long term due to brand visibility, robust track record (pre-covid) and various marketing strategies. Also, growth in tourism will act as a tailwind which will enable to increase in the market share of online travel market (OTA) players.”

Yatra Online is India’s leading corporate travel services provider in terms of the number of corporate clients and the third largest online travel company in India among key OTA players in gross booking revenue and operating revenue for FY23. The company has the most significant hotel and accommodation tie-ups amongst key domestic OTA players of over 21,05,600 as of March 31, 2023. Yatra Online is also India’s leading corporate travel service provider with 813 large corporate customers, over 49,800 registered SME customers, and the third largest consumer online travel company (OTC) in the country in gross booking revenue for FY23.