Ladies and gentlemen, good day and welcome to the Wonderla Holidays Limited Q3 FY'23 conference call hosted by ICICI Securities Limited. As a reminder, all participant lines will be in the listen only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Aditya Chattopadhyay from ICICI Securities. Thank you. Over to you, sir.
Good afternoon, everyone. On behalf of ICICI Securities, I'd like to welcome everyone on the call today. Today from the Wonderla Holidays management we have with us Mr. Arun Chittilappilly, the Managing Director, and Mr. Satheesh Seshadri, the Chief Financial Officer. Before beginning the call, I'd like to congratulate the management for delivering another very strong quarter. I'd now like to hand it over them for their opening remarks and take us through the road ahead. Over to you, sir.
Hello?
Hello. yes, sir. You are audible. You can go ahead. Sir, you are not audible at the moment.
Can you hear me now?
Yes, we can hear you now, sir.
Yeah. Okay. Good afternoon, everyone. Welcome to our Q3 and nine months earnings call. Joining me on this call is, Mr. Sashi, Satheesh Seshadri, our CFO. We are very happy to announce that in this quarter we have achieved an impressive set of numbers. We have closed a record-breaking revenue in Q3. This marks the fifth consecutive quarter with double growth revenue and in revenue and footfall. To begin with, I'm absolutely delighted to report that in nine months we have crossed the INR 300 crore revenue mark for the first time in the history of the company. INR 20 EPS mark has already been posted as the highest ever. We have consistently grown both value and volume.
Our EBITDA margins have been at a very healthy 50-52% and an extremely commendable performance, balancing growth and profitability. In our efforts to attract a very younger audience, we are promoting our parks as a destination for thrill events and grand parties. Our initiatives to host concerts have received tremendous response with large sold-out concert events which have been held across Bengaluru and Hyderabad in this quarter. Following the massive success of our Sunburn event in Q2, this quarter we had a New Year party in Hyderabad and another large event in Cochin for New Year as well.
A lot of these and more initiatives have contributed to generating higher footfall compared to Q3 and nine-month, FY 2024 relevant period pre-COVID numbers. Our footfalls in this quarter registered double growth of 28%.
Excuse me, this is the operator. Arun, Sir, you are not audible if you are speaking. Excuse me, Arun, Sir, can you hear us? Ladies and gentlemen, the line for the management seems to be bad. Please stay on the line while we reconnect with the management.
Please, I think
Yeah, one second. Hold on, hold on. Ladies and gentlemen, we have the line for the management reconnected. Please go ahead.
Sorry about that. I'm in the airport, so my connection is a bit bad. Please forgive me. Yeah. Anyway, our initiatives have contributed to a huge, higher footfalls compared to Q3 and nine months of 2023. The total footfalls have gone up by 27%, like I said. We continue to gain wallet share and grow our non-ticket revenue. Exciting initiatives have helped us improve our merchandise sales and F&B to 23% growth year-over-year. Price hikes have been absorbed well, and we have recorded a 27% increase in ARPU. Our strong operating leverage leads to an enhanced EBITDA, which continues to be in a rising trend. It has more than doubled from INR 27 crores to INR 61 crores or up by 120%.
I would like to highlight that we have registered highest ever EBITDA margin at 52%, which was expanded by 1,400 basis points. Subsequently, our profitability is making new highs despite exceptional itemization, we've clocked a massive 85% growth in our PAT. For the nine months, again, we have done some very good numbers. We have a INR 328 crore revenue reported, and it's a 44% growth compared to last year. EBITDA has been increased from INR 108 crores to INR 128 crores, which is a remarkable growth of 64%. Our parks provide an excellent families and friends to bond together in a wonderful outdoor environment. We are very bullish on this segment going forward.
I thank you all for your support and we can now proceed to Q&A, please.
Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press star one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Turaga Vivek from BESTPALS Finserv Research & Advisory. Please go ahead.
Thanks, Arun. Thanks for the opportunity. Two questions. One, on the new parks, because you are tying up with Madhya Pradesh and other states. I don't know at what stage. If Chennai is getting delayed, because we have enough cash and even if we do the similar performance, even if we don't grow on this year, we'll have enough CapEx for two to three parks. Can you throw light on how are you thinking of CapEx and how confident are you on the Chennai one? If Chennai one doesn't come through, what is the next stage where you think you can go ahead because of your, I think, at least on the Twitter, looks like you are going around a lot of states.
Two, on your own, I'm not asking for a guidance, but your impression on how next year would be given. Will you grow or it will be tough to maintain this year? Do you think there's a reason to be optimistic about the next year's growth? Thank you, Arun, and congratulations. Thank you very much.
Thank you. We are only recharging three new projects for the coming financial year, which is our INR 400, INR 350-400 projects in Chennai and INR 250 crore projects in Odisha. The Chennai project has been currently put on hold because we're still waiting for the waiver on the tax. When, as and when that is done, we will resume operations, start construction. We have just put it on hold. We're not abandoning the project. That it's a big size. Regarding Odisha, I think we will be able to do completion on time. At some time in 2025, we will open this park for the public. The Chennai park might get delayed by another six months or so.
2025 is when I think Odisha will open. On these two projects we don't need to raise any more money. I think they are okay. As a, you know, in terms of feasibility these two projects. The other two projects we will not be starting immediately. We will do currently only two projects at a time. Once the Odisha park is done, we will start working on Madhya Pradesh and so on. At that point, we might have to raise some capital. Currently, we are not looking to do that until into next year.
If Chennai is getting delayed, you will take up Madhya Pradesh one first or nothing like that? You are very confident that Chennai will go through sometime.
If, yeah. If for some reason it gets further delayed, again for a long time, then obviously we will look at other projects, but otherwise we will continue to, you know, do Chennai.
You have enough places.
Next year we are gonna grow. Next year I think we should see a double-digit growth compared to this year. Obviously not 1.6 or 1.8, but I think we should grow by 15%-20%. That's the hope.
You are thinking that you will be able to grow on this even without assuming that revenge travel and all?
Yeah. Yeah. I think, I don't think that the demand is over yet. People are still traveling, and it should continue into the next year as well. You know, otherwise I think our, you know, the demand, should, it's coming our way. I don't think it grows tremendously over this year's numbers, but I think we can expect some margin growth.
Oh, good.
Then of course our two will grow. Got it. Got it. R one volume together you're riding your double digit at least.
Yes.
Thank you. Thank you, Arun. Thank you very much.
Thank you. The next question is from the line of Kaustubh Pawaskar from Sharekhan by BNP Paribas. Please go ahead.
Good afternoon, sir. Congrats for excellent set of numbers. My question is again on the footfalls. For nine months we have already reached around 35 lakh footfalls. Is it fair to assume that we will end the year close to 30 lakh footfalls? Over the next two years, should we expect, you know, footfalls growing in the range of 6%-8%? In the pre-COVID era, the footfalls were growing in low single digits. Now since you have placed some strategies where you are expecting, you know, which are playing well for you and we have seen in Q3 all, you know, we have achieved nine lakh footfalls.
Considering that, should we expect, you know, next year, and year after that, footfalls growing by around 6%-8%?
Yeah, I think it's fair that around 6%-8% we are expecting. Hopefully more than that also. Let's see.
Okay. My second question is on the margin. For nine months, we are at around 50%, 52%, you know, EBITDA margin. By, maybe by the year we might close EBITDA margin at around 45%-47%, depending on how the Q4 pan out. Going ahead, should we expect margins to remain at this level? You know, for a full year at around 45%, 46% or there is a scope of, you know, further margin improvement. And whether in Q3 was there any one-off in case of, you know, expansion in margins or it was largely because of the strong growth in the footfalls which helped you to, you know, see better margins?
Yeah, I think our margins are some of the best that we've ever had, probably worldwide, in terms of malls. I don't think we'll grow more than this. Maybe margins could come down a little bit because I think, you know, our interest or some other new policies have to change. Margins could come down a little bit, but for existing parks, I don't think the margins will be affected. Maybe as a company level it could change, maybe 50 basis. Satheesh can give more information on this, but I think, I don't see margins going up more than this.
Normally we make about 40-42% EBITDA margin. This year has been extraordinary. We have been able to contain some of the goals and some of the costs. With the projects coming up and the footfall going to the scalable level, next level, we might have to invest in resource and the cost what we have holded for the year we might have to extend it next year. We will not be, we might not be having this level of healthy EBITDA of 50+. We might be closing somewhere around 45 compared to 40-42 what we have been doing earlier. With the increase we will be looking at around 45% margin.
Right, sir. Fair enough. My third question is on what is the contribution from, you know, online, or e-commerce platform, for your ticketing business? Like, it was in high single digits now, you know, where we stand on that front?
We do about, close to 15%-20%, online booking on the walk-in footfall.
Okay. My last question is on the new plants, you know, new, sorry, parks you are coming up in Madhya Pradesh, Punjab. So whether this will be close to the Odisha park, it will be smaller than your existing park in Bangalore, Kochi, Hyderabad? Would it be, you know, close to the larger parks? Again, over here, are we looking at, you know, you know, leasehold, you know, land where you will be developing the parks so that it won't add stress to your balance sheet? So similar kind of Odisha model.
Yeah. In Madhya Pradesh we are not looking at a big park. We'll be doing something small as we require. Depending on the size of the city and what offer we get, we will do accordingly.
Okay. Okay. Thank you.
Thank you. The next question is from the line of Angad Kadade from Monarch Networth Capital. Please go ahead.
Thank you for the opportunity. First of all, congratulations on the fantastic set of numbers. One small bookkeeping question, before I ask the question is, can you share the park-wise mix of group and walk-ins for this quarter, please?
We normally don't give the group mix for the park levels, but at the overall level, I can give it to you. Walk-in was at 44% and group was at 56% for the Q3.
Okay. Okay, great. Last call, you had mentioned about investment in technology. You are experimenting with variables and CRMs, and you are waiting for results in the next three to six months. Any updates on that? What will be the total investment going forward for that across the three parks if it is decided to put the investment goes ahead? Will it be recurring or a one-time investment?
The wearables, we are doing a POC and investment with, in the Bangalore park to start with. We have already invested about INR 2.5 crores in this regard. We will do the trials and everything for about a few months, and we will replicate the same model in other parks. These wearables will help us in the seamless visitor journey, number one. Payment gateway for F&B and retail inside the park. This will also help us to do some type of queue management and other resource building. Thank you.
Yeah. the investment,
It is all capital.
It's a capital investment. Okay. Yeah. Yeah, One more question. How much, regarding the CapEx for Bhubaneswar and Chennai, how much CapEx has been done, and how much is pending?
For Bhubaneswar, as of, we have done a commitment close to about INR 13.5 crores till the 31st of December. The further commitment of over INR 16 crores has been done till time, and close to about INR 30 crores commitment is there for Bhubaneswar. The architect design and the basic enabling and construction work and their works is in progress. Of Chennai, there's no major investment except for small investment on the earthworks. What it was left out, we are just completing that. It's close to about INR 11, 10 crores in Chennai investment.
Yeah. Thank you so much. That's all.
Thank you. Ladies and gentlemen, to ask a question, you may press star and one on your touchtone phones. The next question is from the line of Darshan Jhaveri from Crown Capital. Please go ahead.
Hello. Hi, sir. Congratulations on a great set of results. Thank you, and thank you for taking my question. Sir, I think our businesses are a bit seasonal in nature, our Q1 and Q3 would ideally be the best quarter. How is Q4 planning out right now? How was January month out? Could you know any way of footfall? Would it be similar to Q2, or how would it pan out?
Normally we don't give the existing quarter performance finally during the period. Yeah.
Okay.
Yeah.
So, so in general-
I think, yeah, in overall it is
Sorry, sir?
Overall trend is similar. Whatever we are seeing, we can expect something similar there.
Okay. Okay, sir. I also wanted to ask with regards to next year's growth that you said about 15%-20% growth. Sir, with an increase in footfall and... how much of ARPU increase are we seeing? Because I think we can, you know, unlock some value out there also. Because even a 10% growth in footfall and some similar growth in ARPU can, you know, help us a lot, sir. What kind of a price increase are we seeing for the next year?
Something similar. I mean, we expect we have might increase our prices by between 8%-12% around from during the video for next year and because our footfalls are so healthy, we are also confident to take the price hike. Yeah. reasonable to assume maybe 10% growth in what number we are going forward to this year.
Okay. Thank you so much, sir, and all the best for the upcoming quarter, sir. Thank you.
Thank you. The next question is from the line of Keshav Garg from Counter Cyclical PMS. Please go ahead.
Sir, many congratulations for excellent numbers. Sir, it's very encouraging that we have opened a new vertical, which is to host concerts and parties. I'm trying to understand that is this a one-off on New Year's and so on? Can it be a regular Friday, Saturday, Sunday across our three parks, can't we organize parties?
Hello. Yeah. We do, I mean, right now we are doing few events like once a month or something. The large events we do once a quarter or maybe something. Small events we are doing once a week, once in two weeks. It keeps changing. It's still a new field, so we have to keep evolving that way.
Sir, what I'm trying to understand, like if we can arrange for some famous artist, then every weekend in every park, can't we, like, really do this?
Yeah, I think we have planned it. Not every weekend we can. Maybe we would like to increase the frequency once we, you know, have a better team in place that way to execute each kind of thing. Yeah, we are looking to expand into the whole event and park with activities. Different things we will be doing.
Sure, sir. Also now the apprehension is, sir, that since most people, they don't go to our water parks every year, I mean, they go periodically once a few years, and since after COVID, there was a huge lull. This year now there is a lot of pent-up demand which has come, and now we have a very high base. On top of this base, next year, sir, how confident are you that firstly we can hold on to these numbers? Then, like you said, that you are expecting a marginal growth in volumes as well as realization, so as to overall growth can be 15%-20%. How confident are you about that, considering that there is a major element of pent-up demand in this year's numbers?
Satheesh, can you answer it, please?
See, we have been trying few of the efforts or strategies what we have put in place. These strategies have been realizing for us in terms of digital marketing, number one. Number two, instead of traditional marketing. Our reach outs and the content management is more different. We are also able to fix activities. We have at least two activities per park per month for both the walk-ins and groups, consecutively are doing. We have also appointed institutional sales rep and strengthening the institutional sales side of it. We are optimistic the groups will perform. Number three. Number four, we are also working on tour operators. Our strategies have been, we have been consistently getting good feeds from these supports.
We feel it could continue for the coming years also.
Great, sir. Sir, wanted to understand that, sir, how many resorts do we have? Do we have a resort in each of our three parks, or do we have only one resort in one park?
We have only in Bangalore Park currently. We have 84 rooms, resort in Bangalore Park. In Kochi Park, we have tied up with one of the star hotels there, to offer the same play offers.
Sir Yes, sir. You were saying something.
We are also exploring the certain other class in similar to this stay in Bangalore park. It is still in a testing phase. Once it is done, we will replicate that model in other parks.
Sir, is there enough space in our existing three parks, like in, so as to, let's say, make a resort or to expand or to launch new rides?
Yes, we do have additional unused land currently.
Sir, in the investor presentation, it's mentioned that we have 220 acre land bank. This land bank is includes our existing three parks or this is we are only talking about Chennai and Orissa?
This includes the land bank, which is owned by the company that is Kochi, Bangalore, Hyderabad and Chennai.
Right, sir. Sir, thank you very much. Sir, lastly, just one word of caution, sir. There are many companies in, especially in Tamil Nadu and Andhra, sir, which have taken land on lease from the government for 30 or 40-year lease. Now when the lease has expired, and they already have their plant over there. Now, government is asking for unreasonable increase in lease rentals. We should keep this in mind because in Indian Government you know how this works. To insulate us over the long term. Sir, thank you very much.
We'll see after 100 years, what is the lease amount, nobody can say it.
Right, sir. Great. Thank you.
Thank you. The next question is from the line of Gaurav Gandhi from Gloritail Capital Management. Please go ahead.
Hi, sir. Congratulations on the excellent set of numbers. Sir, what will be the capacity of Bhubaneswar park and Chennai park?
Hello?
Chennai will be similar to Bangalore and Bhubaneswar will be about half of Chennai.
Chennai is similar to Bangalore and Bhubaneswar?
See the capacity.
It'll be half, around half the size. Half or maybe two-third of our big parks.
Two-third of our big parks. Once the government approval receives from Chennai government, how much time will it take to complete the Chennai park from there?
Hello?
Hello.
We are looking at two years. We are looking at two years. 18 months to two years is what we are looking at.
Two years. All right. All right, sir. Fine. Thank you.
Thank you. The next question is from the line of Meet Jagani from Meet Jagani Finance. Please go ahead.
Yeah. Hi. Congratulations on the great set of numbers. I was wondering, any timeline for this Chennai approval?
We don't know. It could happen very soon or it could take more time. I'm being honest.
What precisely it is taking so long for this approval as we are waiting from a long time?
That we'll have to ask the government. We don't know.
Sir, sir, we have to understand two things. One is we had the intermitted COVID period, and also there was a change in government. Okay? The elections were through and everything. The new government has come in place and we are reviewing it. We are in constant touch with the government. As it is a government matter, we are also hoping that they are responding favorably. They are hearing our meetings, they are hearing us. We are hopeful that it will come, but we can't put a timeline to it. Okay? Thank you.
Okay. Have you taken any price hike in this quarter?
Last price hike was in September. We have taken a 100 INR price hike. We have not taken any price hike this quarter.
Okay. Thank you.
Thank you. The next question is from the line of D. Kanoria from Aditya Mills Limited. Please go ahead.
Good evening, sir. I wanted to understand what is your average daily footfall in your Cochin, park, and what is the average spend per customer over there per day?
Satheesh, please answer.
Yes, please. Kochi Park, we have done for the quarter is about INR 3.16 lakhs for this quarter. It's our both the groups and the walk-in footfalls together. It's our numbers.
That is for 90 days, this 3.16.
That is for 90 days. We have done about, INR 8 lakh that
INR 3.16 lakhs you said, right?
Sorry, 3.16. INR 316,000.
Pardon?
Three years, three quarters together is 8.36. One quarter is three point.
One quarter is INR 3.16 lakhs.
Yes.
Yes. The average spend per customer?
The ARPU for Kochi park. As I said, we normally don't give, but still I will share for the Kochi park ARPU for the quarter. Correct?
Yes.
For the quarter it is, about, INR 1,000. 1 second.
INR 1 thousand.
More or less.
Okay. Okay. Would you say that the January-March quarter is the leanest quarter in the year because of, exams for children, et cetera?
Sorry. Yeah, Kochi was INR 1,100, was the ARPU for the quarter.
Okay. Okay. Very good. I was asking whether the January-March quarter is traditionally the leanest quarter because of exams.
See, the leanest quarter is normally Q2 is the leanest quarter because it's a monsoon period.
Right. Right.
Q3, sometimes we get a good response because many of the corporates and the schools and colleges also close the budget. Okay? Also we have got some good seasons during the Q4 too, in terms of Sankranti, Republic Day, Women's Day...
Yeah.
Also the Holi and other things coming up. Some seasons are there during the Q4. Q2 is normally the weakest of the quarter.
Okay. Okay. Then probably Q1 is the best because of holidays.
Q1 is the best quarter from the footfall and the ARPU perspective.
Right.
We have got the best rates during that time.
Okay. Thank you very much.
Thank you. Thank you. Participants who wish to ask a question may please dial star and one on their touchtone phones at this time. The next question is from the line of Venkatesh Subramanian from LogicTree Investment Advisers Private Limited. Please go ahead.
Yes, sir. Good evening. My question is on the new growth opportunities at Punjab, Madhya Pradesh, Odisha. Two Questions: What is the probability of something going through at Punjab and Madhya Pradesh and in what timeframe do you expect them? Apart from this, are you also talking to other state governments as well concurrently?
We are reasonably confident about Madhya Pradesh, because they're very serious, they're very keen for us to invest in Madhya Pradesh state park. Punjab also they have been very forthcoming. Like, again, these are government matters, it's hard to finally say what is gonna come out of it. We are reasonably confident that, you know, Everybody seems to be very keen to have new investment and value creation in their states and they are keen for large amusement park projects to come especially in our large cities. We are hoping that a good percentage, you know, 80% will be reasonably confident. We are reasonably confident, yes.
Okay. If that were to happen, at least by this calendar year we will get to know whether it's working out or not?
not all of it. I mean, because we are talking to many state governments,
Okay. Others as well.
Like, for example, Madhya Pradesh and Odisha, obviously they are very serious. I think we are more or less certain that these two will go through. The others, we are still in discussion.
Right, sir. Who else? You're talking to Gujarat as well, is it, sir?
We are talking to a bunch of different, a lot of states, actually. Most of them, actually.
These are all at the discussion stages, okay? It's all government matters, so it's going to take some time for us to get clearance from the government. We will let you know once the MOUs are signed, yeah.
Got it, sir. Thanks. One follow-up question from an earlier participant. You broadly said things are looking okay, and we can probably look at 15%-20% growth next year overall. Did I get it right, sir? 15%, 20% in terms of top line broadly.
Yeah. 15% minimum we should be able to do. That's the hope anyway. Again, these are unprecedented times. We really don't know how the, you know, the crowd and, you know, the public are going to react in different states. We are hoping we are... I think there is definitely a huge demand for travel and leisure, and I don't think that demand is going to abate very quickly. Also, traveling abroad has become much more expensive than pre-COVID. I think a lot of people are, you know, in India, and I think that trend also should help companies like us.
Okay. What do you see... When you interact with, your customers, basically there's a lot of strong consumer sentiment, sir, broadly towards spelling, towards spending.
Far, yes. Yes.
Okay. Sounds good, sir. Thank you. Wish you the best.
Thank you. Ladies and gentlemen, that was the last question for today. I would now like to hand the conference over to the management for closing comments. Over to you, sir.
Thank you all for attending our Q3 conference call. We hope to, you know, come back next quarter with even stronger set of numbers. Thank you all for your support and wishing you all the best. Thank you.
Thank you. On behalf of ICICI Securities, that concludes this conference. Thank you for joining us. You may now disconnect your lines.