Two Tourism Stocks to Add in Your Watch List

The travel and tourism industry is a major foreign exchange earner in India. Opening e-tourist visas along with restarting normal international flight operations will provide a boost to the industry. Of course, it depends upon how the pandemic plays out and how deep and wide vaccinations reach. The government’s focus on improving India’s attractiveness for international travelers and the increased pace of vaccinations augurs well for the sector. There is a high possibility that India will witness a colossal travel boom due to revenge travel and breaking off from a monotonous routine. Two stocks look attractive in this space with a medium-term horizon.

1. Easy Trip Planners Ltd (NS:EASM)

Established in 2008, EaseMyTrip is an Indian online travel company. It focuses on the B2B2C (business to business to customer) distribution channel and provides travel agents access to its website to book domestic travel airline tickets. EaseMyTrip operates through 42,000 travel agents, 1,200 franchise outlets, 640 white-label solutions, and 1600 distributors. The company’s Rs 510 crore IPO in 2021 made it the first online travel agency listed on the Indian bourses. The company has a strong brand value among Indian middle-class air travelers. EaseMyTrip’s wide presence in the ever-expanding Indian online ticketing market, lean business model, niche online marketing initiatives, healthy balance sheet coupled with experienced management should speedily drive its future growth.

In Q1FY2022, EaseMyTrip reported a robust 189.3% growth in consolidated total revenues amounting to Rs 34.75 crore. Its gross booking revenues increased 260% year-on-year, whereas non-air transactions jumped 23.7 times in the quarter on a year-on-year basis. Net profit was up 600% at Rs 15.43 crore in the quarter. Its net margins were 44.4% in the June 2021 quarter compared to 20.8% in June 2020. The stock’s RSI stands at 64, indicating a neutral outlook. However, its MACD of 11.16 and the difference between 20-day EMA and 50-day EMA suggests a bullish outlook on the scrip. The share returned 142.2% in a year and delivered positive returns on year-to-date, six months, one month, and five-day periods.

2. Thomas Cook (NS:THOM) India Ltd

Thomas Cook India operates leading B2C and B2B brands including, Thomas Cook, SOTC, Kuoni Hong Kong, Sterling Holiday Resorts Limited, Travel Circle International Limited, and Private Safaris East & South Africa. The group is one of the largest travel service provider networks headquartered in the Asia-Pacific region. Thomas Cook India revamped its business strategy after the pandemic to adopt a hybrid operating model. Its renewed focus on its digital portal, exceptional attention to domestic segment, greater customization through build-your-own-holiday module, and a far-reaching, vast network should push its top-line growth ahead.

In Q1FY2022, Thomas Cook India’s consolidated total income from operations jumped 238.6% to Rs 288.03 crore from Rs 85.06 crore a year ago. Its net loss came down to Rs 83.43 crore in the quarter from Rs 94.21 crore in June 2020 quarter. On the technical side, its RSI, MACD level, and 20-day and 50-day EMA are signaling a buy. The scrip has more than doubled in a year, 31.4% year-to-date, 6.62% in six months, 3.54% in a month, and 6.7% in five days. It trades at a 12.2% discount to its 52-week high of Rs 71.50.