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Wonderla Holidays Ltd
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Ladies and gentlemen, good day, and welcome to Wonderla Holidays Limited Q4 FY '22 Results Conference Call hosted by ICICI Securities. [Operator Instructions] Please note that this conference is being recorded.
I now hand the conference over to Mr. Rushad Kapadia from ICICI Securities. Thank you, and over to you, sir.
Thank you, Lizen. Good afternoon, ladies and gentlemen, and welcome to the Q4 FY '22 Results Conference Call for Wonderla Holidays. We have with us from the management, Mr. Arun Chittilappilly, Managing Director; and Mr. Satheesh Seshadri, Chief Financial Officer.
So without further delay, I would now like to hand over the floor to the management for their opening comments. Thank you, and over to you, sir.
Thank you. Good afternoon, everyone. Thank you for joining us today. We extend a warm welcome to all of you at this conference to discuss the results of Q4 for FY '21, '22 for Wonderla Parks and Resorts. I'm pleased to inform you that our company has delivered a healthy performance in the midst of a pandemic year. We registered a revenue growth of 232% Y-o-Y with revenues at INR 127.5 crores in FY '22 compared to INR 38.4 crores in FY 2021. This performance reflects our brand strength and public's trust in our company and our offering and the strategic clarity on achieving growth and operational excellence. The results are a clear endorsement of our salient -- resilient business model and asset quality. Also our stakeholders depend on our ability to provide a safe and hygienic environment for our employees and customers.
The Parks were closed from mid-April until the beginning of August due to the Delta variant and in December and January during the Omicron variant, and we posed a great challenge for us. However, our focus in terms of leveraging digital marketing, scaling content, consistent park activities, experiments and thematic and F&B and retail innovations with seamless execution helped us to achieve a solid finish to the year with marked improvement in our revenue and EBITDA positions. We are constantly making efforts to please our customers with innovative ways. There are so many different events that we have done in the last quarter, the highlight of which -- one of which was Women's Day, where we recorded the highest footfall ever in our 22 year history of 32,000 visitors. This event response was the most encouraging and the crowd's enthusiasm was at its peak.
All our initiatives received such tremendous responses from our customers. As a result, our total footfalls for the quarter exceeded INR 4.9 lakhs and a total of INR 10.5 lakhs for the full year. The Q4 footfall helped us to breach the pre-COVID level of revenues for the quarter, EBITDA and PAT. Q4 started out with the fresh round of government restrictions to -- on -- because of the Omicron variant. We had weekend lockdowns in Cochin and Bangalore. The footfalls improved only towards the end of February. But from March onwards, the footfalls have been pretty robust.
The footfalls are dominated by Women's Day and our Holi celebrations. All 3 parks recorded the highest marked footfalls since their respective openings. We are pleased to inform you that the company has returned to a positive EBITDA, and we are dedicated to offering memorable experiences to our customers, and our performance is a testimony to our resilience and our employee superb customer service and commitment. We also continue to strengthen our brand value and target to cross new growth in -- operational growth and operational milestones ahead.
Thank you for your continued support, and I look forward to seeing you in our parks soon. Thank you.
Should we open up for questions? .
Yes, please? .
[Operator Instructions] The first question is from the line of [ Himanshu Upadhyay ] from O3 Capital.
Congrats on good set of numbers. See, I am attending the call for the first time, and I have some basic queries, okay? So the first question is, would it be right to say that for a successful park operating company, the 2 things to look for are how they sweat the assets more and the novelty factor every time the customer comes besides good experience in safety. So these would be the 2 critical factors for success?
But you didn't complete your question. I couldn't hear the last part of it.
No. So this was the basic question. So the first question was this -- for a successful park operating company means the 2 success factors are these 2. How much...
I think operational excellence is paramount because safety is the big issue and cleanliness and hygiene. So those are the -- it's the gold standard, only the part which can do that very well will get -- and then, of course, you need to continuously add new attractions and new events and new things to entertain your guests, yes. .
And secondly, do you think that beyond the point, increasing the number of rides will have a limited ROI. See, we have a decent size of land in the 3 operating parks and have a good number of rides. And we can take them to 70, 80 in future. But beyond the number, will the ROI need not be met through the rides only?
Yes, I think -- yes, beyond -- I think our parks are pretty big enough, especially Bangalore and Kochi. I don't think they are planning to add any more rides. If we are going to add any rides now we will remove some of the old rides. So that's what we are doing. And for our capacity of about 12,000, I think we already sufficiently have enough rides. We don't want to add too many rides. But depending on the year and for example, the kind of rides that we added in 2002 or 2003, very different from the rides we are adding now in 2022.
So that way, I think, I mean, obviously, the kind of experiences we are giving are slightly different. So yes, I hope that answers your question.
And -- means we will still have undeveloped land. So what can be the future development plans here? And one thing related to this...
We are not planning anything right now. When -- we might add more rides or we could add other facilities. We've not thought about it because land historically has been got for us at very cheap valuation.
Okay. See, if we start getting or if we want to reach something like, let's say...
Sorry, I think you've already finished 3 questions. Could we ask the next person to question.
Okay. Okay. I'll join back in the queue then.
Yes. I think 2 questions per person, please.
The next question is from the line of [ Sanjay Awatramani from Envision Capital ].
So just wanted to know what is this other counter collections and cooked food share revenue?
The -- yes, -- the -- in the parks, there are a few counters, which we have given on revenue share model, okay? The revenue from those on we share from concessioners, number one. Number two is the other collections are basically, we have got the digital watch and other locker fee and other things what we charge. So that is other collections.
Okay. And the next question is that the -- what is the progress on Chennai and Orissa Park, which we were planning to open? And what is the total expected CapEx, which we are doing for Chennai?
Okay. So Chennai, right now, it's on hold. We are not really -- what you call it, we have not started any work there. We have invested about INR 100 crores, mostly, in land itself. We have another INR 300 crores. So total, I think, about INR 400 crore investment, INR 300 to INR 400. I think we don't know the exact number yet. But we have an outstanding issue with the taxation there. So unless that is sorted out, we will not be able to start. And so we are negotiating with the -- I mean we are talking to the Tamil Nadu government to see if we can find a solution. . So at that point, whenever that is done, we will start work. I think it is looking positive, we should be able to do it before the end of this financial year, I think we will have to -- we will either -- we will decide one way or another. Orissa is a smaller project about less than INR 100 crores. That one, I think is -- again, Orissa government has invited us to set up the park there and they're giving us land almost for a very nominal lease and things like that. But we are planning something smaller, it will be about less than INR 100 crore investment. And also our ticket price also will be lower.
But for us, Bhubaneswar looks like an exciting market to go to do a light version of our park. This project, I think, should be able -- we should be able to get off the crown this financial year itself.
Okay. Sir, just a follow-up on this Chennai one that -- you're positive that you will start construction work or the construction will be completed by FY '23 end?
We'll start -- I think we will take a decision on Chennai and Orissa. Orissa is already progressing. Chennai, we will take a decision on whether to construct or not in this year and then we -- accordingly, we'll take a -- depending on what is the -- because currently, it's not viable for us to build the park because the taxation there is very high. So if that is not removed, then I don't think we'll be able to build. So that call we will take in this financial year. That's what I meant.
Okay. And last thing I wanted to confirm was what will be the CapEx for FY '23? And the Chennai thing you mentioned that INR 350 crores to INR 400 crores, exact CapEx is not yet in line, right? I mean, which is the addition...
We don't know yet. So including the land, I think we are reporting less than 400, but we will have to see how much -- Satheesh, you have -- we don't know the full thing yet, right?
Yes, sir. You absolutely said correctly. We are still waiting for the approval from the government to waive off the entertainment tax. Subject to that, we are not starting the project. Otherwise, we would have started the project, number one.
Number two, the initial projected CapEx was at INR 330 crores. But based on the approval when it comes, we have to take on the -- redo the estimates, possibly it could go by another INR 10 crores or INR 20 crores, it could go up on the Chennai project. Orissa project, the initial outlay is about INR 120 crores, including the fees which we have paid to -- paying to the government and other things. So that's where it is. The construction timeline schedule is about 2 years from the time we start the construction. So that's how we work.
Okay. Okay. Okay. And last thing, sir, CapEx for FY '23. This will be the last from my end.
See, we have got sustaining CapEx. Every year, we have about INR 30 crores of sustaining CapEx and some new rides what we propose for the parks, okay?
For the project, we have identified about initial payment of about INR 10 crores to the government for the lease completion and everything. And we have identified, earmarked about INR 50 crores for this year for the park approvals, if it comes in Orissa. That's why we have earmarked. And we are not able to -- while we are very positive on the Chennai project, still we are not able to put a date when the government will give the approval, Okay?
We'll move on to the next question. That is from the line of Kaustubh Pawaskar from Sharekhan by BNP Paribas.
So my question is on footfall. So this quarter, despite the fact that there was a third-wave scare we have, we did 4.94 lakh of footfalls. And out of that, in March itself, we did around 3 lakh footfalls. So now we are into our season like April, May is one of the strongest season for us. So should we expect footfalls to be much better than what you locked in, in March? And considering the run rate, should we expect your footfalls to reach to pre-COVID level in FY 23 ...
We are expecting it around pre-COVID level. We are not sure yet because again the quarter is not over. We could go above or below, but we don't know. But as of now, the footfalls are healthy, yes.
Right, right. Any thought process for the year because we have been hearing from the hotel industry that domestic leisure travel and domestic tourism is getting -- because of the pent-up demand, there is...
As of now, yes it's looking very strong. But again, like I said, I'm repeating it again and again, but we don't know right about COVID, if this is going to come back and it's going to affect again. We don't know. Hopefully, it will not happen. If that is the case, then obviously, things should be good for us this year. But if there is a scare of another round or -- sorry, another wave and things like that. And obviously, then those things have to be considered.
Right. And sir, earlier you used to provide the footfalls for all the 3 parks. So can you just help me with the footfalls for 3 parks and the ARPUs?
You can reach us out separately. And for the quarter, we will give not month-wise. For the quarter, we can give it to you.
Quarter, okay.
You can reach out to us separately, please.
Sure, I will do that.
The next question is from the line of Dhruvesh Sanghvi from Prospero Tree.
Can you expand a little bit more on what are the -- what is the exact reason for reconsidering the Chennai team? I mean on the taxation side, with some numbers, if you can highlight state-wise or some thought process around it that why is it so important?
So the tax on ticket in Chennai is 10%, like GST, we pay on ticket is about 18%. But on top of that, in Tamil Nadu, there is an extra 10% tax on every ticket that is sold in every amusement park or a movie theater. That makes our projects unviable, especially a large project. So that is...
This is 28% collectively, right, or 38, sorry?
28%.
Right. But does it mean that probably 3, 4 years waiting and then making this decision when probably, I mean, the income of the country or some macro numbers start to look favorable, considering that this 28% remains 28%. Or it will still be unviable or that is -- I mean some thought around it, of course.
We don't know. We are trying to get the -- 18% on the -- GST on the amusement park ticket itself is very high. It used to be less than 10% 3, 4 years back. Now that has become 18%. Now we will not be able to sustain high CapEx in this sector if you are going to charge 18% -- more than 18%, 20% tax because then the viability of the project itself, it will be suspect. And this is not only for Tamil Nadu. Any state if the tax on ticket becomes very high, for this is essentially like a infrastructure kind of business, where the large CapEx are fully upfront, right?
So we will not be able to -- this will not make sense for us business-wise. So we'd rather look at other states like Bhubaneswar or Ahmedabad -- sorry, Gujarat, where we've been invited. Wherever we get invitations from the government to set up the park, so we will look at it favorably.
We were invited by Chennai government, but this was 5 years back and since then Jailalitha Park was made, so many things have happened. So now it's a DMK rule, and they are willing to relook at this whole thing. The problem happened only after GST because still GST, the tax on ticket in Tamil Nadu was 10% that was always there. But there is no other -- the other taxes were not there. There was only x1. After GST came in, this 10%, they retained it. So that's the issue, yes.
Right. Right. And one question related to -- I mean, when we look back at almost all the con calls, of course, I'm not talking about the COVID years of 2 years. Pardon me, this question is a slightly longer one, sorry. So what happens is we as investors are probably thinking that over a longer period of time where affordability starts to kick in better. There is a chance that this 7 lakh, 8 lakh average footfalls per year can probably go to 10 lakh or 11 lakh, with slightly increases in the ticket prices as well, let's say, 4%, 5% a year kind of a scenario. Is this the thinking that even you have as an assumption? And how much more work do we need to do to expand that 7 lakh to 10 lakh on a sustainable basis?
7 lakh to 10 lakh should not be a problem depending on the year and if there are favorable conditions, economy is doing well. If everything is good, then obviously, we'll hit 10 lakhs, and we have hit that in the past. But the last time we hit that was, I think, 2016 or '17.
Ever since the GST regime, because our ticket price has gone up, and I think the construction also has been a little muted, especially in our sector. So -- but I think we -- things improve we will be able to see those kind of numbers again. And also, this is a function of the marketing that you do. I think we were not into digital marketing those days. We were doing a very different kind of very traditional marketing. That has completely changed in the last 1 year, especially post-COVID that is why we are seeing huge numbers, especially odd months also, they're getting good falls -- good footfalls. But too early to say what number we will return. You will see.
The next question is from the line of [ Surendra Singh Reddy ], an individual investor.
My question is more about efficiency of park operations. For example, I recently read a con call from Six Flags where fee was paid near the 30% of the seats on coaster ride were empty every time because groups don't...
Sorry, I didn't understand that what you are saying. .
Sorry. Let me go slow -- this is about.
A little slow.
Yes, sure. This is about efficiency of especially rides. So I have come across -- I went through a recent con call from Six Flags, where a fee was paid, 30% of the seats were empty because groups who don't want to split up. So in order to drive out the inefficiencies, they like set up single liner riders -- I mean single rider names. So can you shed some light on inefficiencies in our park operations and...
We don't have those kind of problems. We have people, we fill up every ride. Initially, during the COVID month, I think we used to follow. But now we are filling up our rides fully. So we don't have those issues.
Kind of things like group don't want to split up.
No, no, no. Some very, very, very small numbers. I don't think it's a significant enough for us.
Great. Good to know. So and other thing, do we have any longer waiting lines at food courts or something like that where customers would be disappointed waiting for hours and get back to the rides, something like that?
Going to any amusement park means you are going to wait. I don't know whether you've been to any amusement park or whether it's international or Indian. Parks are the thing is waiting. So because we only have a certain number of rides. And depending on the crowd, there will be waiting involved. Right now, we are in the busiest season of our -- so people do have to wait at least 15, 20 to 0.5 hour, maybe like for our roller coaster they have to wait for 45 minutes. But that's normal. That's how the industry works.
Got it. Got it. Yes. The only concern is like I've been to Arlington, Six Flags. The concern here is that you end up waiting a long time and you missed some interesting rides.
That's part of the deal wait; till you go to Disney we'll have to wait even more.
Yes. Got it. Got it. But -- so you guys are always working on driving out these kind of connections.
Yes. I mean in India, I think we do try to reduce queues as much as possible because generally in India, discipline is also a bit less. So we are very aware of it, but I think there is some amount of queue that is avoidable. But I think, generally, in our past, we have a very efficient system of managing our crowd between the water park and the dry park and we've not really had too many -- if you look at our online reviews, maybe in our peak season, you will see queues are long. But otherwise, it's not a big problem for us.
Great. Great. That's really good to know. And so I haven't been to any parks, sorry about that. But -- so do we have any displays installed across the park about the waiting time or something like...
Depends. Some of the rides, some of the popular rides, we do show waiting template.
Great. Okay. So the customer is like aware of the ride...
He is aware that this is either -- you can see -- and it's also very evident when you see the queue, you will know that this ride is popular and people are waiting, right? So that happens.
The next question is from the line of Monika Arora from Galaxy Investments.
Congratulations on a good set of numbers, sir. You told that you are planning some CapEx expenditure. And like so any plan to take debt exposures or you are planning to infuse more equity? Like how you will be funding this?
I think we have internal accruals for -- currently for our -- whatever CapEx are we planning to do this year. We might take some small amount of debt, yes. that's it. Satheesh...
Okay. And how...
This year, we're not planning any debt. Now Satheesh can give more light on that?
Yes, yes, sir. As of now, only if our Orissa park comes, we can go ahead with the internal accruals if only 1 park starts. If both -- 1 or 2 or more than 1 park starts, then we might go for a debt proposition. And normally, we generate -- in a normal year, we generate more than INR 100 crores per year. So the internal accruals should be sufficient to take care of the expansions.
And I may have missed it, so how much is the CapEx plan, sir?
See okay. The CapEx plan is INR 120 crores for Orissa project. And for Chennai project, the estimate is about INR 330 crores. Both of it can go up based on the situation and the experience required there, number one.
Number two, currently, I have as of 31st of March, we have got more than -- about INR 120 crores, we have in hand. So that can take care of limited requirement. Construction period is 2 years. So there will be internal accruals during the construction period. If both the parks come together, we might need some loan, which we will approach to the bank.
Okay. Okay. And how is the overall scenario in terms of your capacity utilization, if I talk in the park. So after all these COVID pandemic, first cycle, second cycle, and all this -- now do you see that the situation on the ground is, I would say, is it normal like pre-COVID, people are coming as usual. How is it, sir? Would you like to throw some light...
Right now, it's better than pre-COVID. We're also experiencing the whole phenomenon of revenge travel and tourism. And so we are seeing that extra demand. But we don't know how long that will last but I definitely feel that if there are no further waves, this year should be a good year for us.
Especially because it is an ongoing summer vacation kind of a thing right now.
For example, March is not a summer vacation. This is the time when we have -- all the schools have...
No, I'm asking about ongoing, like right now.
I'm giving you an example that March is traditionally a very weak month for us. But this year, we've done; traditionally what we do in April, we have done in March. So April is season and March is off season. But we have done April numbers in; March. Right, Satheesh?
Yes, sir. And sir...
So March has been very good. So [indiscernible] it continues, let's see.
I see, please understand that the management has taken very proactive steps in terms of liberating the digital marketing. Innovations, F&B and retail, then improving the retail footfall, adding more content to the media and by bringing all influencers and doing park plus events okay. And also increasing the away markets, we are also going -- trying to do something with the North and other things. So we are doing all the positive steps. And I think these things will add on to the footfall, and you could see a good trend coming up or building up in the near future.
The next question is from the line of Manoj Dua from Geometric.
Most of my questions have been answered. Could you throw more light on -- little bit on the new initiative like digital you have taken in some food and beverage, anything which was not...
So basically, we are doing a lot of experiments. I mean we can't tell you everything about it, but because there's a huge list of things that we are doing. But it all comes from a lot of analytics-based marketing that we do online, which we are -- which I think we've been able to crack that very well. So we have completely stopped using traditional media, and we use only digital marketing. We do use our traditional media only as pillars. Unlike before when we used to rely more on traditional media and less on digital. So that reverse shift has happened after COVID. And that has worked really well for us because our marketing spend has come down. At the same time, our footfalls are going up. So I think that's a -- hopefully, it will -- still an emerging phenomenon. We are still doing a lot of things. The full result of all that is yet to come.
Great. And as you said, your booking has been digital now at 50% as compared to 15%, somewhere I read about that. Is it true?
Yes, about 30%, I think, of our -- all our online bookings so far have been -- bookings have been online, which is only 10% I think pre-COVID, now that has become 30%.
Okay. As you're getting more and more bookings through digital, any data analytics? Any insight you have got more...
Yes, that's what -- so we -- that's why we know the kind of customers who are coming to us. We are using that to retarget and do remarketing and a lot of other things, which we never could do before. That is also helping us to improve footfalls.
The next question is from the line of Vivekkumar from Bestpals Research and Advisory.
My first question is on -- if let's say, Chennai gets delayed, what is our next park or next state of location that you are looking at? And my second question is, okay, this year, there's a revenge kind of a thing that you are alluding to because of which you are seeing demand. So what are the steps that you think or you should take to make sure that this repeats even if, let's say, there's no COVID. And on a normal year, how do you make sure that you grow on top of this year and sustain those footfalls?
Hard to say how we can sustain footfalls on top of a revenge tourism. We'll have to wait and see. But like I said earlier, yes, like I said earlier, we've done a complete change in the way we do marketing to our customers. We have much more insight. We have a lot more insight on who's coming to our -- what kind of people are coming, where they are coming from, what is the age group? What is the demographic? We know a lot more information now. So I think we are able to target our marketing a lot more precisely. Instead of carpet bombing, we do more laser-guided marketing. So that has really helped us, I think. And hopefully, that we will expand. And so we're still trying to implement a full [ CRM ] for our company and are changing our [ website ]. So lot of things are still in the pipeline. It's still not finished. I think once the whole digital marketing stack has been -- when it goes online, I think we should be able to have a lot more analytics and we should be able to really target. We'll be able to even predict footfall hopefully one day. So that is the goal there.
So you can also talk about how we keep at least 2 activities per park per month?
Yes, Yes...
Lots of have developed, yes.
A lot of experiences that we're changing the experiences in our parts by adding new varieties of F&B. We're also redoing some of our F&B outlets. We are earmarking a small amount for that every park, we are going to upgrade our F&B outlets and have more F&B points. And I also do more collaborations and get new kinds of F&B, what is the best trending outside, we should be able to get that in the park. So a lot of that kind of activity in terms of improving our non-ticket to ticket ratio also we are doing in addition to the marketing. So -- and also, we're doing a lot -- some big events once in a while, which attracts a lot of crowd and the new crowd, for example, we do rock shows, concerts. We have done Rain Dance, we've done Holi, we've done Women's day. So a lot of different things we have been doing to create a buzz in the market, yes.
And the location, if let's say, Chennai gets delayed inordinately, what is the other location that you will consider, which is...
We're looking at a few other locations. Immediately, obviously, we look at Orissa. After that, we are looking -- Goa is one place that we are keen to do something. Again, we have been invited from -- by the Goa government to do something. We've been invited by the Gujarat government also. These are some of the other places that we're looking at, yes.
So last question, in general, on the long run, if you have to maintain, if you think, as a company, what are the internal things that you think as a company you shoot on, what are the external things as economy that should happen so that footfalls grow in the long run? Like last 10 years, if you have seen -- our footfalls have not grown. So let's say, I just want you to please explain what...
Until demonetization, our footfall was growing very, very -- if you look at our footfall trend, it was growing at almost 20% CAGR for the first -- till 20...
No, I'm -- if you go parkwise -- sorry, I'm not trying to stop you, but if you go parkwise, Kochi has actually come down a lot over the last 10 years. Bangalore has gone to 1 million, came back. Hyderabad, I do not want to comment because we just opened just 2 years before COVID, so I don't want to comment on Hyderabad. So I'm just asking, in the long run, what are the things...
$1 million is the -- I think, $1 million to $1.2 million, will be the maximum for our park, okay? We can't do more than that. So -- but we hope to get there very quickly. So like I said, we had a couple of issues. One is, I think the economy was not doing well post demon. So then the GST came in, and the tax on the ticket went up, so our ticket pricing -- so 2, 3 different issues. And we were late to switch to digital. We should have done the digital switch maybe in 2018 or '19. We didn't do that. We're doing now.
But -- so a lot of -- some of those -- I think all those factors together has prevented us from reaching our potential in terms of footfall. I think I'm seeing some change there, and we will definitely be able to -- I think we'll get the -- cracking a million should not be hard for us. But again, I can't promise you that this year because we don't know what is going to happen...
No, I am just -- in general, I'm asking as a company because -- sorry. Because I think we are not -- most of the con call cases that we were seeing was mostly on why we are not able to achieve the potential in terms of the company. So I was just trying to understand.
I think we had a marketing issue because I think young people who consume our parks, they have moved since 2016, whenever Jio happened, I think since then, the huge population is more completely online. So targeting them with TV or newspaper ads is -- it's not really helping. So that shift that we've done now, which we should have done maybe 2, 3 years back. I think that has helped us a lot. And it also will help us reduce our cost in coming years.
So reaching -- maintaining 1 million or, let's say, in each park would not be a very aggressive assumption, right, to model your company?
It's not a very aggressive assumption. We should be able to do that, yes.
The next question is from the line of Anuj Sharma from M3 Investment.
Yes. Yes. Am I audible?
Yes, very much.
See, 2 questions. One is if you look at us globally, some of the parks can reach a capacity of 3 million. And in India, we are not a country with many parks, but the population is meaningful. So why do you say we are constrained at 1 million, 1.2 million. Is it that the capacity to pay is limited? Or have we designed parks in such a way that we can...
I think our parks are designed for about 1 million, 1.2 million kind of size. If you want to do 3 million, we obviously have to build a much bigger park.
All right. But in terms of...
So we can do -- I mean if numbers increase to a point where, let's say, we hit 1.5 million in a year. And we have -- that also can happen, right? Sometimes we don't expect a footfall. And then, for example, last March the same thing happened, we didn't expect that kind of footfall. Suddenly it happened. So that has happened before also. So initially when we opened our park, it was called Veega Land in Cochin. It was -- the capacity was only 0.5 million.
Then when we realized that in our second year or third year, we almost reached 800,000 or whatever, that's when we expanded the bar. So we will -- we can expand each of our parks depending on the number of people who are coming.
We can eventually make it a park which can handle 3 million visitors also that's -- we can do that. We have surplus land, so we can do that.
Yes. So in capacity...
In its current size, each of our parks can handle only about 1 million to 1.2 million, max 1.5 million.
Got it. Got it. So in terms of capacity side, we have excess capacities. We can build up to that. But when you evaluate many countries, what is critical juncture wherein this threshold crosses a meaningful. I mean, we still are meaningful, but just suppose 2 million or 3 million. What changes in economies or any trigger points which leads to this?
I think people's propensity to spend have to improve because if you want to build a park which can attract 2 million visitors, we obviously need to -- it has to be a bigger park. It will be -- obviously, our CapEx will be higher, and people have to be willing to pay that kind of ticket. It's also a question of the people's ability to spend, right? If you compare to the U.S., where people spend about $15 to $20 on a movie ticket. How much do they spend here, INR 300, right? That's not even -- that's about $5. So that difference will always be there and that will prevent us from making huge parks. And this is also the same reason why a company like Disney or Six Flags can't afford to build the park in India because they will never make the money back, right? So we have to -- I mean because India is still a developing country. I think we'll have to -- we have to do it for our crowd.
And just one more question. See, you talked about the non-ticketing revenues and efforts we are making for -- in fact, I was asking -- meant to ask a question on gaming, entertainment and themes in the -- so extending the park time, so how you've experimented multiple things. How much we can gain from the non-ticketing revenues based on whatever experiments we have done? And what is the traction there?
Yes, our goal is to get to 60%, 40%. Right now, we are 75%, 25%. 75% ticket and 25% in non-ticket. Our goal is to get to 60-40. I think we should be able to get there in a few years, 2, 3 years. .
The next question is from the line of Gaurav S. from [ Glory Tails ].
Most of my questions have been asked earlier. I just wanted to congratulate you on the good set of results and the way you have handled the business in the entire COVID situation is absolutely amazing. I mean the negligible cash burns you have done that shows the intent, so congratulations on that. But any plans in Maharashtra to take on Imagica or something that [indiscernible] ?
Those are the parks that are too big in terms of CapEx and there are other legal issues. So there are so many hurdles, and we are not an asset reconstruction company. So we will not be able to take that risk. We have offered to manage the park for them because I think we can unlock a huge amount of value, but we are not going to invest in any such specific assets currently. And I think that, that park has already been sold to somebody else.
Yes, it's sold to Malpani Group. And the -- whenever you will plan in future, maybe 3, 4, 5 years, I just have a suggestion that the Nasik-Mumbai area that -- in the middle of that -- is the good area to go for the -- [ Bombay ] has already been taken and Nasik-Bombay has some wonderful views and scenes and most of the people will come to us. So that's a good place.
We'll definitely hope to come to Maharashtra sometime soon.
The next question is from the line of Mithun Aswath from Kivah Advisors.
My first question was more on -- if you look at FY '19 pre-COVID, we had about 25 lakh footfall. Are we in the run rate currently, if we continue, do you look at reaching those levels in FY '23. And also I wanted to understand what are your average ticket prices now? Have they been increased Based on FY '23 versus FY '19.
So hard to predict what the footfall for the year is going to be? Because like I said, again, it depends on whether there are further COVID waves and lockdowns and all those kind of things. That all that will definitely affect people's propensity to go out to a crowded place. So if that doesn't happen, I think we should be able to do better than FY '19. Then what is the other part of the question? Sorry I forgot.
On the ticket price? .
Ticket price, I think we are better than FY '19 -- Yes. I think Satheesh can give you some detail on that.
Yes. We have come back to -- the ticket price, we have come back to the pre-COVID levels. And we have been very judicious in the -- on the ticket pricing. We see how the trends go up, okay? We don't push the ticket envelop too fast. We see the trend. And then now as such, most of our parks are at pre-COVID level.
Right. Just one other question was, globally we have seen most of these parks which do very well are in a tourist destination. But the 3 parks we have are just in cities which may not be really tourist hubs. So is there any thought of maybe starting something say in Goa, which would going [indiscernible] with tourist as well, so...
Yes, of course, we are looking at Goa as one of the options.
The next question is from the line of Dhruvesh Sanghvi from Prospero Tree.
That question has been answered.
The next question is from the line of Manoj Dua from Geometric.
Any change in customer behavior post COVID in terms of spending? Are they spending more in food and beverage now? Are they ready to take the Fastrack tickets. Throw some light on that.
Yes, I think we are doing -- we are seeing a much higher spend compared to pre-COVID, especially in Q4 results, you can see that. Also, I think more retail footfall. So like, for example, they are less dependent on groups now post COVID than we were pre-COVID. Pre-COVID I think, we used to depend heavily on group sales.
Now our dependence on group sales for all 3 parks have. So Cochin is an exception, where we still get huge groups there. But the other 2 parks, dependence on groups have come down, which is a good sign. I think that means that higher spending customers who are coming -- paying full price and then, obviously, the people who pay full price will tend to spend more inside the park. And like I said earlier, we are doing more F&B and retail options and different thematic offerings that we are doing, which has helped us improve those numbers.
As you said, 1.2 million is the capacity in which our park is built. But if we get more number back, expanding our park is not a difficult option for us, and it...
It's not difficult. We can do it.
Thank you. The next question is from the line of Binay K. from Prudential Investments.
There's a lot of disturbance from your line.
Yes. Can you hear me properly now?
Yes.
Yes. So this is a general question. I just wanted to know how do you -- since you've witnessed pandemic, and you handled yourselves perfectly well. How do you see the company for next 3 to 4 years from here? If you can -- is there a vision something that you?
I think it's -- like I said, I mean, if coming out of a pandemic, if that is truly over and there is no other pandemic or any other big shock that is going to come to keep customers going out, I think we should be able to have 2, 3 years of very good growth. That is why we are also now looking at expanding to other cities.
And like I said earlier, we are -- we have been invited by many state governments to come and set up the parks in their respective states. We are evaluating Goa, then Gujarat, Orissa obviously we are doing soon. So like that, I mean there are a lot of opportunities. We are also thinking about -- like I said earlier, we are looking at taking over large projects, which maybe other people have invested and maybe converting that into a Wonderla park and on a revenue share or a management basis. So we are exploring some of those opportunities. As time goes by, we will firm up our plans on these.
The next question is from the line of Dhruvesh Sanghvi from Prospero Tree.
Yes, sorry, I had 1 more thought, which I want to discuss. When we see the -- today's time in terms of overall entertainment, there are so many new forms of entertainment, which are coming, including gaming and even the malls, because the theaters are getting challenged due to Netflix, they are also rethinking on how to create further experiences. Now considering the kind of time that we have, and we still in India do not have a large Saturday, Sunday culture. In that sense, is it not creating a tougher environment for us to really get people, because travel times are increasing and a couple with the kids wanting to come, will have to essentially spend 5,000 to 7,000 and get really tired and be in the sun. I mean how does all of this thing look to you? And is this a challenge at all?
No, that is not a challenge at all actually because if you look at the outdoor entertainment where there is active fun, high-speed, thrill, splashing water, these things are never going to go out of style. If you -- you were born in 1990s or 2010 or 2020, 2050, some of these physical activities, I think, are going to remain. For example, a mall will always be an indoor activity or it's going to be -- what you can do there is always going to be limited. We are an outdoor activity.
We are in -- all our parks are in between beautiful landscapes in nature, on hills, valleys, those kind of places. So it's a more outdoor and it's an active outdoor kind of entertainment. That I don't think will go out of style because if you look at all the parks all over the world, they've all been growing from 1,800s also the oldest park in Copenhagen, they are still doing well, and they're still growing. So I don't think this segment will have that issue.
But having said that, of course, the kind of entertainment that we offer could also evolve, like, for example, now we are doing physical rides. I think in the future, there will be a mix of physical plus virtual and some will be fully virtual. All that can happen, but I think the essence of physical active outdoor fun is not going to -- like you cannot replicate a water slide or rollercoaster virtually, the feeling that you get it is not possible to replicate that, and going with your friends and family.
In one of the previous con calls, I think you had used the word insta-friendly places and creation of those situations or something like that is what I remember. So are you really looking to change...
Yes. Yes. So like, for example, like I said, we are an outdoor -- where our parks are beautiful. If you look at our -- if you look at our hashtag on Instagram, Wonderla have far more pictures than, for example, a mall or in fact, any other amusement park in India, I think Wonderla ranks #1 in terms of sheer number of pictures and videos that you see on Instagram. I think we are #1. So itself shows you that people -- and also you should remember that people don't go to Wonderla park every week like you go to a mall. You go to a Wonderla park maybe once a year, twice a year, thrice a year, not more than that, right?
So because you always go with friends, family for a special occasion, birthday, anniversary, I don't know, whatever else, right? Or you're bunking class with your friends, and you're going to go with your girlfriend to the park. So those are the kind of outings that we get. So those are not as frequent as going to a mall. So I think the chances for us to have drop in visits is much lower than compared to a mall because a mall will always have a high frequency, right? You go to watch a movie maybe 2, 3 times a year, at least. That can come down because of Netflix. Whereas you don't expect that to come -- you don't come to a place like Wonderla more than 2, 3 times a year. So that is...
Fair enough. Fair enough. And the second one, when -- I mean, again, we have been hearing that you are evaluating certain takeover opportunities or newer places or invitations. But I mean, if we can just put a little bit more sanctity to these, let's say, just to understand and guess the timelines, that okay, when will we have some outcomes available? So can we say...
Very difficult to predict.
No, I understand. So -- is it like that -- okay, there are 20 opportunities which have already come to you on your table, which you have thought through and discarded something like that. Is that a correct estimate or some thought around it?
We have about 3 or 4, which we are evaluating currently. That's how I would put it. There are other opportunities. For example, we could do a park in every large city in India. I think there are about 100 large cities in India, which are more than 1 million population. I don't know. So that's -- technically, it's possible to build in all those cities. But obviously, these are large CapEx. There is a lot of local government support required. There is a lot of land acquisition is there. There is government approvals are there. These kind of tax issues we might have to sort them out, I don't know. So I think every state has different laws.
So that is...
So that is why it is questioned, because it is such a long gestation thing that 5 years back when we started thinking Orissa or Chennai, it is still not even started into construction. Maybe over time, when we have more power...
That is the state of our country. What can you do about it? Land acquisition is hard, getting approvals is hard, taxation is hard, everything is hard. So -- and we are a large CapEx, right? We are not like -- we are not like a multiplex, you can rent it and then build it within 3 months and start operating because the mall is built by somebody else usually, right? So we are -- we have to build everything from scratch. And we are a very large investment also compared to doing a multiplex. So it definitely has its own challenges. And that is one of the reasons why you don't see that many Amusement parks also, right? Even globally, it's not like Disneyland is not -- building a Disneyland in every country, then they will not be able to do it. It's not sustainable.
The next question is from the line of Rahul from R. Consultant.
Hello, am I audible?
Yes.
So my question is, according to you, which park performed best in last financial year out of the 3 parks.
I think Bangalore always performs the number one? Then I think followed by Hyderabad and followed by Cochin, right, Satheesh?
Bangalore is top positive.
Bangalore is #1, and then followed by Hyderabad.
And sir, my second question, like we are getting good traction and things are back to normal. So are we planning to increase ticket price in the coming quarter?
Yes, yes. We have already increased ticket price 3x. We're going to increase one more time June 1st onwards because we're seeing huge demand and many days our footfalls are crossing 5,000, 8,000 like that. So because of that, I think we do -- we have increased -- we are increasing prices. And we are also even thinking about dynamic pricing, but that will take a little more time because that depends on our IT system to be up and running. So it will take some time.
The next question is from the line of Vivekkumar from Bestpals Research and Advisory.
One question. What are the locations you said you were considering some locations in terms of management, I heard, where you will have revenue share? What are the locations or it's too early to say?
It's too early to -- I mean, we are just - We've got a lot of -- we're not really...
So you think in the next 2, 3 years, 1 or 2 will definitely get to their logical conclusion.
I think we definitely want to get into that market because we feel like that is something that we can -- so I think...
So no -- at least you can talk about, is it north, west. So at least the location, I'm not asking you specific details of the project.
I think it will be North and West, yes.
The next question is from the line of Neha Sharma from [ Paul Global Investments ].
I just have 2 questions. Can you provide the guidance as an -- do you have any plans to increase the park capacity in the coming year of the existing parks further?
See, depending on footfall, we'll definitely keep expanding our parks. We've been doing that for a long time. Compared to [ infection ], our parks have definitely grown in size. Cochin has more than doubled in size, Bangalore also maybe 30% larger. Hyderabad is still -- we are still adding right? We've not reached the full. Still -- Hyderabad is still our smallest park. So we will be investing in more rides in Hyderabad as footfalls are growing now. And now Hyderabad has become our second best performing park. So yes, we'll keep adding attractions and facilities.
Okay. And sir, one more. Can you provide some guidance on the expansion strategy, which states are you targeting?
It's hard to say, like I said, we look at large cities typically which has attachment. We are open to all types. We can do coastal cities like Cochin. We can do Bangalore or we can even do hot places like Hyderabad. So I think it's very versatile that way we can do it in any kind of climate. Only thing we will have to regulate in terms of the weather, we'll have to maybe have more indoor or more outdoor facilities. So that is not a criteria for us. Obviously, we look at ease of setting up and whether we've been invited by the government to set it up or not because that makes things a lot easier for us.
The next question is from the line of Gaurav S. From [ Glory Tails ]
I just had one more question. Do you have any in-house ride manufacturing unit, any [indiscernible] ? I mean, can you throw some light on our ride procurement process, how would we...
We have -- we've been manufacturing right since 2000, so 22 years, we've manufactured, right? We have made everything from small kiddie rides to water slides to even roller coasters to virtual reality, everything we have made. All our -- we even have about 3 or 4 patents to some of our rides. Even our iconic Skywheel that is there in our logo also, that's also completely made by us.
The next question is from the line of Surendra Singh Reddy, an individual investor.
Just a quick question. So what happened to Colombo, given the situation in Sri Lanka will still constrain park operations over there? Are you still on the table?
No, I don't think -- we have not heard from them yet. I'm guessing right now, it must be on hold. But we had an opportunity to take over a park in Colombo, but I don't know what is the situation in having these. Maybe it will get delayed it's what I assume.
But it's not completely off the table. Is that correct?
It's not off the table. I mean we are open to looking at it. They have already invested a huge amount of money there. They've got the best international design consultants to come and design that park. And I think a lot of [ others ] also have been great. So I think the park will get set up at some point, but we don't know when.
The next question is from the line of Harshit Vora from Multi Way.
If we decide not to go ahead with Chennai project, what would be the financial implications of backing out from the project?
If we don't have any business, we have to sell the property. I don't think that will be a problem for us. And we are not going to lose money as the values have already skyrocketed over there. So that is an option we can liquidate the asset or we can definitely try to do a different kind of some other -- you like to look at some kind of other investments or we'll figure it out, but I don't think it will be a lost cost. But we are hoping that we should come through. All the signs are telling us -- I think the new DMK government is more aggressive now. So hopefully, they will also get more investment into their state. That would be all for me.
Ladies and gentlemen, that is the last question. I now hand the conference over to the management for the closing comments.
Thank you all for attending the Q4 FY '22 conference call. We look forward to a good Q1. As of now, we are very happy with the response we've got. We hope that we can keep up the momentum, and we have a lot of exciting plans for the coming years. So hope to see you all soon again. Until then, thank you, and goodbye.
Thank you. Ladies and gentlemen, on behalf of ICICI Securities, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines. Thank you.