IIFL

Cox & Kings (Buy)

CMP: Rs 139.85

Target: Rs 185

Outbound travel is the most important component of C&K’s India offerings as it accounts for 67 per cent of the domestic revenues. C&K India segment revenues have witnessed robust 26 per cent CAGR (compound annual growth rate) over the past 4 years; we expect India business to motor along with 21 per cent revenue CAGR driven by rising disposable incomes and growing share of organised travel segment. Cox & Kings acquired Holidaybreak for an EV of $730 million which brought a spate of four new operating divisions — education, adventure, hotel breaks (for short trips) and camping, which have leading positions in the UK and other major European markets. The acquisition adds new product avenues for C&K and expands C&K’s buying scale as it now includes HBR’s European operations.

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