Praveg LtdQ4 FY24Leisure Services

Praveg Ltd

Q4 FY24 Earnings Call Analysis

Management growth scorecard

Revenue

Category 2

Margin

Category 3

Fundraise

N/A

Order

Yes

Capex

Yes

2 of 4 growth signals are positive.

Revenue guidance

Category 2

→Praveg plans to develop 9-10 resorts annually for the next 3-4 years, aiming to expand capacity from currently 10-12 resorts.
→Target is steady growth by capturing opportunities in India and overseas, including at least one resort in Kenya (Maasai Mara) for experience before aggressive expansion.
→The company targets an INR 60 crore turnover from the nine upcoming resorts next year, backed by INR 90 crore capex.
→Payback period for investments is aimed at a threshold of 1.5 years; up to 3.5 years considered acceptable for some projects.
→Event management and hospitality segments contribute 40% and 60% respectively to revenue, with expected growth as pandemic restrictions ease.
→Plans to increase resorts across states, avoiding concentration in one state (>20%) and balancing owned land (40%) with leased land (60%).
→Seasonal resorts like Varanasi and Runn of Kutch operate 7-8 months; other resorts aim for year-round operations to mitigate seasonality.

Category 3

→Praveg plans to develop 9-10 resorts annually from 2023 to 2026, targeting a maximum payback period of 1.5 years, extendable up to 3-3.5 years for select projects.
→Capital expenditure for FY 2023 is INR 90 crores for nine resorts, expected to generate about INR 60 crores turnover next year.
→Management aims to maintain EBITDA margins around 50%, with quarterly margins recently reaching around 60% due to higher business volumes.
→Revenue mix is roughly 60% hospitality and 40% events/exhibitions, with a growing focus on hospitality to mitigate event seasonality.
→Growth target includes scaling turnover possibly approaching INR 200 crores by FY 2025, subject to occupancy and new resort performance.
→The company pursues disciplined financials, focusing on rapid payback investments and expanding presence across Indian states, plus potential PPP resorts.

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→There is no mention of any current or planned fundraising through debt or equity in the provided transcript of the Praveg Limited conference call dated February 14, 2023.
→The discussion primarily focuses on expansion plans, resort development, payback periods, project details, land acquisition, and operational aspects.
→Capital expenditure is discussed (INR 90 crores for upcoming projects), but the source of funding (debt or equity) is not specified.
→The company emphasizes growth via PPP projects and own land but does not mention raising new capital through fundraising channels.

Yes

→Praveg Limited is actively planning to develop 9 to 10 resorts annually over the next 3-4 years, aiming for steady capacity growth.
→Currently, the company has 4-5 resorts on its own land and 5 in Public-Private Partnership (PPP) mode.
→The strategic plan is to diversify geographically, ensuring no state accounts for more than 20% of the total resorts.
→About 40% of resorts will be on owned land and 60% on leased or government land.
→The company has specific projects lined up, including Tent Cities at Daman, Diu, Jampore Beach, and others like Sasan Gir, Kevadia, Kumbhalgarh, Velavadar, Ranthambore, and Udaipur.
→No explicit numeric detail of total orderbook value or pending orders was disclosed, but the pipeline includes 24 projects expected by 2024-25.
→The company is poised to capture every opportunity annually, increasing its development capacity from 10 to 12 resorts per year going forward.

Yes

→INR 90 crores capex planned for the current year focused on developing 9 resorts.
→Targeting turnover of INR 60 crores next year from these new resorts.
→Strategic plan to develop 9-10 resorts annually through 2024-2026, depending on opportunities.
→40% of resorts to be developed on company-owned land, remaining 60% on leased/government land.
→Tent structures budgeted at INR 15 lakh per room for temporary and INR 30 lakh for semi-temporary structures (excluding land cost).
→Expansion includes Indian projects (Sikkim, Northeast, Uttar Pradesh) and future international projects (Kenya, Maasai Mara forest).
→A subsidiary established in Kenya to facilitate future resort development.
→Focus on aggressive growth where payback period is around 1.5 years; may extend up to 3-3.5 years if opportunity arises.
→PPP mode used for some projects; strategic decision to have presence across multiple states with no state exceeding 20% resort share.

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