Wonderla Holidays - Chennai Strengthens Medium-Term Visibility | Q1FY27 Company Update

Wonderla Holidays Ltd. reported a better-than-expected Q1FY27 performance, led by a strong scale-up at the newly commissioned Chennai park and healthy traction across mature parks, though growth at the mature parks was partly aided by a favorable base. Revenue grew 44% YoY to Rs 2,426mn, ahead of our estimate of Rs 2,111mn, with Chennai contributing Rs 450mn during its first full summer quarter, while mature parks also supported the overall growth. However, we expect growth at mature parks to gradually plateau, making timely commissioning of new parks critical to sustaining the company’s medium-term growth trajectory. While management remains in discussions for new projects, nothing has been finalized yet; further delays in deploying its sizeable cash and cash-equivalent balance of nearly Rs 4,200mn could impact growth and return ratios. We upgrade our earnings estimates by 17% for FY27E and 3% for FY28E, while introducing FY29E forecasts. We roll forward our valuation to Q1FY29E and assign a multiple of 18x CEPS, arriving at a revised target price of Rs 640 from Rs 615, implying an upside of 27%.

Wonderla Holidays Ltd. Stock Price Chart

Chennai Park drives growth:

Wonderla reported robust revenue growth of 44% YoY to Rs 2,426mn, significantly ahead of our estimate of Rs 2,111mn. The outperformance was primarily driven by the Chennai park, which contributed Rs 450mn during its first full summer quarter, supported by footfalls of 0.24mn and ARPU of Rs 1,850. Mature parks also delivered healthy growth, aided by higher footfalls, improved ticket pricing and a sharp increase in non-ticket spends, though the YoY performance was partly supported by a favorable base. Bengaluru revenue grew 17% YoY, supported by 6% footfall growth and 10% ARPU growth; Kochi revenue increased 13% YoY, led by 6% footfall growth and 7% ARPU growth; while Hyderabad revenue rose 19% YoY, driven by 11% footfall growth and 9% ARPU growth. Bhubaneswar remained subdued, with revenue growing only 1% YoY as a decline in ticket pricing offset higher footfalls and non-ticket spends.

Margins beat on operating leverage:

EBITDA increased 47% YoY to Rs 1,125mn, while EBITDA margin expanded by 80bps YoY to 46.4%. The margin improvement was driven by strong revenue growth, healthy operating leverage and a better-than-expected contribution from the Chennai park, partly offset by higher corporate overheads and marketing expenditure. PAT grew 38% YoY to Rs 728mn, supported by the strong EBITDA performance, despite an increase in depreciation following the commissioning of the Chennai park.

Outlook:

The strong start at Chennai materially improves medium-term earnings visibility and positions the park as the company’s principal growth driver over the next few years. The asset has demonstrated healthy initial footfalls, robust ARPU and encouraging operating leverage, providing confidence in its ability to scale toward mature-park economics. However, growth across the older parks is likely to moderate and gradually plateau as these assets mature, increasing the importance of timely capacity creation through new parks and adjacent hospitality offerings. The company remains in discussions with multiple state governments, but no new project has been finalised yet. Given the sizeable cash and cash-equivalent balance of nearly Rs 4,200mn, delays in capital deployment could constrain incremental growth and weigh on return ratios; conversely, timely project announcements and disciplined execution could provide the next leg of earnings growth and valuation re-rating.

Valuations, Rating and Risk:

We expect Wonderla to deliver a Revenue/EBITDA/PAT CAGR of 12%/14%/14%, respectively, over FY26–FY29E, largely driven by the ramp-up of the Chennai park. Following the stronger-than-expected Q1FY27 performance, we raise our earnings estimates by 17% for FY27E and 3% for FY28E, introduce FY29E forecasts and roll forward our valuation to Q1FY29E. We value the stock at 18x Q1FY29E CEPS of Rs 36, arriving at a revised target price of Rs 640 from Rs 615, implying an upside of 27% from current levels. Key risks include slower-than-expected ramp-up at Chennai, delays in finalizing and commissioning new parks, weather-related disruption and weaker discretionary consumer spending.

Company website: https://www.wonderla.com/

*CMP is as per report published date

Click to download the full Wonderla Holidays Ltd Q1FY27 Company Update

Analyst:

• Rahul Dani - Research Analyst, Institutional Equities (NISM-201500034725)
• Riya Shah - Research Associate, Institutional Equities (NISM-201800191080)

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FAQs on Wonderla Holidays Ltd Q1FY27 Company Update

These FAQs summarize key insights from MNCL’s institutional equity research on Wonderla Holidays, highlighting performance trends, growth drivers and key risks.

How did Wonderla Holidays perform in Q1FY27?

Revenue increased 44% YoY to approximately ₹243 crore, ahead of estimates. EBITDA grew 47% to approximately ₹113 crore, while EBITDA margin expanded to 46.4%. PAT increased 38% YoY to approximately ₹73 crore.

What is the target price for Wonderla Holidays?

The research report maintains a Buy rating with a revised target price of ₹640. The target is an analyst estimate and does not guarantee future returns.

How is the Chennai park contributing to Wonderla’s growth?

Chennai generated approximately ₹45 crore of revenue during its first full summer quarter, supported by around 0.24 million footfalls and an ARPU of approximately ₹1,850. Its ramp-up is expected to strengthen medium-term earnings visibility.

What drove Wonderla’s Q1FY27 margin expansion?

EBITDA margin expanded 80 basis points YoY to 46.4%, supported by strong revenue growth, operating leverage and a better-than-expected Chennai contribution. Higher corporate overheads and marketing costs partly offset these gains.

What is the outlook for Wonderla Holidays?

Chennai is expected to remain a key growth driver over the coming years. However, mature parks may gradually plateau, making timely commissioning of new parks and disciplined capital deployment important for sustaining growth.

What are the key risks for Wonderla Holidays?

Key risks include slower-than-expected Chennai ramp-up, delays in new park approvals or commissioning, adverse weather, weaker discretionary consumer spending and delays in deploying available cash toward productive growth opportunities.

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