INTERNATIONAL TRAVEL HOUSE LTD

Result Update: Q4 FY14

BUY

CMP

179.00

Target Price

200.00

APRIL 16th 2014

ISIN: INE262B01016

Index Details

Stock Data
Sector
BSE Code
Face Value
52wk. High / Low (Rs.)
Volume (2wk. Avg.)
Market Cap (Rs. in mn.)

SYNOPSIS
We initiated coverage of International Travel House
Ltd and set a target price of Rs. 200.00 for medium
term investment.

Travel Support Services

500213
10.00
184.85/117.00
4595
1431.11

International Travel House Ltd is an associate

company of ITC Ltd, commenced its operations in
1981, and offers a full bouquet of travel services in
India.

Annual Estimated Results (A*: Actual / E*: Estimated)

YEARS
Net Sales
EBITDA
Net Profit
EPS
P/E

FY14A
1717.11
359.80
181.07
22.65
7.90

FY15E
1820.14
387.91
199.18
24.91
7.18

FY16E
1938.45
422.56
220.12
27.53
6.50

During the quarter ended 31st March, 2014, net

profit jumps to Rs. 48.59 mn against Rs. 40.47 mn in
the corresponding quarter ending of previous year,
an increase of 20.06%.
Revenue for the quarter rose by 6.62% to Rs. 447.00
mn from Rs. 419.26 mn, when compared with the
prior year period.

Shareholding Pattern (%)

EPS of the company stood at Rs. 6.08 a share during

the quarter, registering 20.06% increase over
previous year period.
Profit before interest, depreciation and tax is Rs.
94.76 mn as against Rs. 83.81 mn in the
corresponding period of the previous year.
1 Year Comparative Graph

International Travel House has recommended a

dividend of Rs. 4.25 per equity share of Rs. 10/each for the financial year ended March 31, 2014.
For the year ended March 31st, 2014, turnover stood
at Rs. 1717.11 mn as compared to Rs. 1643.30 mn in
the previous year, registered a growth of 4%.

INTERNATIONAL TRAVEL HOUSE LTD

PEER GROUPS
Company Name
International Travel House Ltd
Cox & Kings Ltd
Thomas Cook (India) Ltd
Trade Wings Ltd

Net Sales and PAT of the company are expected to

grow at a CAGR of 6% and 7% over 2013 to 2016E
respectively.

S&P BSE SENSEX

CMP

MARKET CAP

EPS

P/E (X)

P/BV(X)

DIVIDEND

(Rs.)
179.00
157.30
102.80
72.00

Rs. mn.
1431.11
21475.80
25449.20
216.00

(Rs.)
22.65
8.27
1.86
0.53

Ratio
7.90
19.02
55.24
135.85

Ratio
1.09
1.89
5.69
3.27

(%)
42.50
20.00
37.50
0.00

QUARTERLY HIGHLIGHTS (STANDALONE)

Results updates- Q4 FY14,

Months

Mar-14

Mar-13

% Change

Net Sales

447.00

419.26

6.62

PAT

48.59

40.47

20.06

EPS

6.08

5.06

20.06

EBITDA

94.76

83.81

13.07

The companys net profit jumps to Rs. 48.59 million against Rs. 40.47 million in the corresponding quarter
ending of previous year, an increase of 20.06%. Revenue for the quarter rose by 6.62% to Rs. 447.00 million from
Rs. 419.26 million, when compared with the prior year period. Reported earnings per share of the company
stood at Rs. 6.08 a share during the quarter, registering 20.06% increase over previous year period. Profit before
interest, depreciation and tax is Rs. 94.76 million as against Rs. 83.81 million in the corresponding period of the
previous year.

Break up of Expenditure

Rs. Millions
Break up of Expenditure
Q4 FY14

Q4 FY13

Employee Benefit Expenses

100.51

90.27

Car Hire Charges

136.43

121.02

Service Charges

47.51

44.96

Depreciation & Amortization

Expenses

24.64

25.70

Other Expenditure

87.91

87.32

Latest Updates

International Travel House Ltd has recommended a dividend of Rs. 4.25 per equity share of Rs. 10/- each for
the financial year ended March 31, 2014.

COMPANY PROFILE
International Travel House is an associate company of ITC Limited, one of Indias foremost Private Sector
companies rated amongst the worlds leading companies by Forbes magazine. ITC is a leading player in Tobacco
products, Hospitality, Golf Resorts, Packaging & Printing, Paper & Paperboard, Leisure Apparels and Gourmet
Processed Food, and also a leader in Agri-business and IT industries.
International Travel House commenced its operations in 1981, and offers a full bouquet of travel services. The
companys services include air ticketing, car rental, inbound tourism, business travel agency and consultancy,
destination management, overseas and domestic holiday packages, conferences, events and exhibition
management, and wedding management. It serves customers through a network of 10 IATA travel offices, 13 car
rental offices, and 19 travel counters across India as well as a global tie-up that provides access to 88 partners in
74 countries through the GlobalStar Travel Management Companies. The GlobalStar tie-up, of course, extends the
Companys reach to almost all the major travel destinations of the world.
Over the years, it has grown to be one of the largest Complete Travel Management companies in India, with each
of its products and services bearing the distinct ISO 9001 quality benchmarking.
With a team of dedicated professionals, a nationwide network, and state of the art technology, International
Travel House is well equipped to address all possible travel needs of both Business and Leisure Travellers.

FINANCIAL HIGHLIGHT (STANDALONE)

(A*- Actual, E* -Estimations & Rs. In Millions)

Balance Sheet as at March 31, 2013 -2016E

FY13A

FY14A

FY15E

FY16E

79.95

79.95

79.95

79.95

1095.19

1236.51

1409.62

1592.87

1175.14

1316.46

1489.57

1672.82

Long term borrowing

0.08

0.00

0.00

0.00

Deferred Tax Liability (Net)

3.86

0.00

0.00

0.00

Other Long Term Liabilities

34.55

22.55

23.68

25.10

Long Term Provisions

17.80

18.75

19.88

20.87

56.29

41.30

43.55

45.97

Trade Payables

388.65

292.28

248.44

216.14

Other Current Liabilities

87.14

94.42

100.09

105.09

Short Term Provisions

57.61

68.38

78.64

87.29

3. Sub Total - Current Liabilities

533.40

455.08

427.16

408.52

Total Liabilities (1+2+3)

1764.83

1812.84

1960.28

2127.31

321.42

326.64

346.24

363.55

b) Non Current Investments

0.00

115.00

132.25

148.12

c) Deferred tax assets (net)

0.00

0.33

0.36

0.39

d) Long Term loans and advances

33.85

41.92

48.63

54.46

355.27

483.89

527.48

566.52

Current Investment

362.79

299.16

329.08

358.69

Trade receivables

891.95

852.44

906.03

979.67

Cash and Bank Balances

55.35

46.60

51.26

55.36

Short-terms loans & advances

99.47

113.59

127.22

146.30

Other current assets

0.00

17.16

19.22

20.76

2. Sub Total - Current Assets

1409.56

1328.95

1432.81

1560.78

Total Assets (1+2)

1764.83

1812.84

1960.28

2127.31

SOURCES OF FUNDS
Shareholder's Funds
Share Capital
Reserves and Surplus
1. Sub Total - Net worth
Non Current Liabilities

2. Sub Total - Non Current Liabilities

Current Liabilities

APPLICATION OF FUNDS
Non-Current Assets
a) Fixed Assets

1. Sub Total - Non Current Assets

Current Assets

Annual Profit & Loss Statement for the period of 2013 to 2016E
Value (Rs. mn)

FY13A

FY14A

FY15E

FY16E

12m
1643.30

12m
1717.11

12m
1820.14

12m
1938.45

Other Income

33.03

47.39

51.18

54.25

Total Income

1676.33

1764.50

1871.32

1992.70

Expenditure

-1306.38

-1404.70

-1483.41

-1570.14

369.95

359.80

387.91

422.56

-0.35

-0.16

-0.15

-0.16

Gross profit

369.60

359.64

387.76

422.40

Depreciation

-110.47

-98.85

-102.80

-107.94

Profit Before Tax

259.13

260.79

284.95

314.45

Tax

-79.94

-79.72

-85.77

-94.34

Net Profit

179.19

181.07

199.18

220.12

Equity capital

79.95

79.95

79.95

79.95

1095.19

1236.51

1409.62

1592.87

Face value

10.00

10.00

10.00

10.00

EPS

22.41

22.65

24.91

27.53

Description
Net Sales

Operating Profit
Interest

Reserves

Quarterly Profit & Loss Statement for the period of 30th Sep, 2013 to 30th June, 2014E
Value(Rs. mn)

30-Sep-13

31-Dec-13

31-Mar-14

30-Jun-14E

Description

3m

3m

3m

3m

408.95

423.98

447.00

460.41

Other income

9.97

10.85

20.12

20.92

Total Income

418.92

434.83

467.12

481.33

Expenditure

-336.15

-361.23

-372.36

-376.62

Operating profit

82.77

73.60

94.76

104.72

Interest

-0.06

-0.04

-0.03

-0.03

Gross profit

82.71

73.56

94.73

104.69

Depreciation

-24.84

-24.31

-24.64

-25.38

Profit Before Tax

57.87

49.25

70.09

79.31

Tax

-17.47

-14.33

-21.50

-24.11

Net Profit

40.40

34.92

48.59

55.20

Equity capital

79.95

79.95

79.95

79.95

Face value

10.00

10.00

10.00

10.00

EPS

5.05

4.37

6.08

6.90

Net Sales

Ratio Analysis
Particulars

FY13A

FY14A

FY15E

FY16E

22.41

22.65

24.91

27.53

EBITDA Margin (%)

22.51%

20.95%

21.31%

21.80%

PBT Margin (%)

15.77%

15.19%

15.66%

16.22%

PAT Margin (%)

10.90%

10.55%

10.94%

11.36%

7.99

7.90

7.18

6.50

ROE (%)

15.25%

13.75%

13.37%

13.16%

ROCE (%)

40.88%

34.84%

32.94%

31.71%

3.72

3.85

3.56

3.26

146.98

164.66

186.31

209.23

1.22

1.09

0.96

0.86

EPS (Rs.)

P/E Ratio (x)

EV/EBITDA (x)
Book Value (Rs.)
P/BV
Charts

OUTLOOK AND CONCLUSION

At the current market price of Rs. 179.00, the stock P/E ratio is at 7.18 x FY15E and 6.50 x FY16E
respectively.

Earning per share (EPS) of the company for the earnings for FY15E and FY16E is seen at Rs.24.91 and
Rs.27.53 respectively.

Net Sales and PAT of the company are expected to grow at a CAGR of 6% and 7% over 2013 to 2016E
respectively.

On the basis of EV/EBITDA, the stock trades at 3.56 x for FY15E and 3.26 for FY16E.

Price to Book Value of the stock is expected to be at 0.96 x and 0.86 x respectively for FY15E and FY16E.

We recommend BUY in this particular scrip with a target price of Rs.200.00 for Medium to Long term
investment.

INDUSTRY OVERVIEW
The Indian economy has slowed down and is not expected to show a GDP growth of more than 5% during 201314. At the same time, inflation will probably continue to be a matter of concern.
Meanwhile, the economic problems in the Eurozone are far from over. The shadow of this uncertainty is unlikely
to recede during the coming financial year.
Domestic air fares are likely to be higher by about 5-10% and could result in a further slowdown in air travel.
Outbound traffic from India continues to show a healthy growth with some 15.5 million Indians travelling abroad
during the past year. According to the World Tourism Organisation, Indias annual outbound traffic should touch
50 million persons by 2020 and account for an annual spend of approximately US$ 28 billion by then. Naturally, a
fair share of this would be on account of corporate travel and incentive tours, where the Company is well
represented.
From a long term perspective, on one hand, the Indian economy continues to have a great potential for growth
and on the other, the travel and tourism industry has been recognised as having the fastest growth rate in the
world. The Company is distinctly poised to take advantage of emerging trends as soon as economic indices start
improving. Many Indian states have commenced efforts to improve their tourism infrastructure and this is likely
to have beneficial effects before long.

Disclaimer:
This document prepared by our research analysts does not constitute an offer or solicitation for the purchase or sale
of any financial instrument or as an official confirmation of any transaction. The information contained herein is
from publicly available data or other sources believed to be reliable but do not represent that it is accurate or
complete and it should not be relied on as such. Firstcall India Equity Advisors Pvt. Ltd. or any of its affiliates shall
not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the
information contained in this report. This document is provide for assistance only and is not intended to be and must
not alone be taken as the basis for an investment decision.

Firstcall India Equity Research: Email info@firstcallindia.com

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