The shares of this smallcap company surged around 7 percent in Friday’s trading session after announcing its foray into the highway dining for travellers.
Price Movement:
With a market capitalization of Rs. 2,635 crores, the shares of Dreamfolks Services Ltd started Friday’s trading session on a higher note at Rs. 494.05 compared to its previous close of Rs. 472.
During the trading session, the shares hit a high of Rs. 514.90, gaining around 7 percent and are currently trading at Rs. 500 apiece.
What Happened:
Such a bullish movement in the share price was observed after the company in an exchange filing announced its expansion into highway dining, marking a significant diversification from its traditional focus on airport and railway station services.
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This new initiative aims to enhance the travel experience for highway travellers by providing dining options at over 600 outlets along major highways across major cities, including Delhi, Mumbai, Bangalore, Hyderabad, Chennai, and Kolkata.
Management Commentary:
Commenting on the launch, Ms Liberatha Kallat, Founder and CMD of DreamFolks, said: “At DreamFolks, we are committed to delivering premium experiences to travellers. With this launch, we’re excited to extend our services to highway travellers, providing them with access to quality dining options throughout their journeys.
As we continue to identify opportunities to enhance the travel experience across multiple touchpoints, expanding our offerings to highways is a natural progression. This new service reflects our vision of creating seamless and elevated travel experiences at every mode of the journey.
Financials:
Looking at the company’s financial statements, the revenue increased by 14 percent from Rs. 281 crores during the March quarter to Rs. 321 crores in the June quarter. On the other hand, the net profits declined by around 6 percent from Rs. 18 crores to Rs. 17 crores during the same timeframe.
Monopoly:
Dreamfolks Services Ltd commands a 90 percent market share in the card-based airport lounge access market in India and a 68 percent Market Share in the overall Lounge Access. The company has exclusive partnerships with major credit/debit card issuers, airlines, and other travel companies, giving it access to a vast customer base.
Future Outlook:
DreamFolks Management has set ambitious financial targets for FY 25, aiming for a 20 percent revenue growth, a gross margin of 11 percent to 13 percent, and an adjusted EBITDA margin of 7 percent to 9 percent.
Additionally, the company is strategically aiming to diversify its revenue streams by targeting non-lounge services to contribute approximately 20 percent of its revenue over the next 3 to 4 years.
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Company Profile:
Incorporated on April 24, 2008, DreamFolks Services Ltd is India’s largest airport service aggregator platform facilitating an enhanced airport experience to passengers leveraging a technology-driven platform.
Written By Vaibhav Patil
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