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Subscription for Initial Public Offering (IPO) of Dream Folks is starting on 24th August. Should you bid for this IPO? What is the Price band of Dream Folks IPO? What is the lot size of Dream Folks IPO? Read the article up to the last to know everything in detail.
About Dream Folks Services Company
DreamFolks is India’s largest airport service aggregator platform. It facilitates an enhanced airport experience for passengers leveraging a technology-driven platform.
Since its inception of operations in 2013, the company has transformed itself from being an airport lounge access aggregator to an end-to-end technology solutions provider for designing and delivering services that enhance the airport experience.
With an asset-light business model, DreamFolks integrates global card networks operating in India, credit card and debit card issuers, and other corporate clients including airline companies.
Business Profile of Dream Folks Services
Card Segment
DreamFolks provides services to all the Card Networks operating in India including Visa, Mastercard, Diners/Discover, and RuPay; and many of India’s prominent Card Issuers including ICICI Bank Limited, Axis Bank Limited, Kotak Mahindra Bank Limited, HDFC Bank Limited (in respect of debit card lounge program) and SBI Cards and Payment Services Limited. As of March 2022, it had 50 clients including the card networks and many of India’s prominent card issuers.
Hospitality Services
Dreamfolks provides various other services such as food and beverage offerings, spa services, ‘meet and assist’, airport transfer services, transit hotels/nap rooms access, and baggage transfer.
In India
Dreamfolks claimed to be enjoying a market share of over 95 percent of all India-issued credit card and debit cards that have access to airport lounges in FY22. Further, it also accounted for around 68 percent of the overall lounge access volume in India. Since, 2020, 9.79 million (97.9 lakh) pax (people or passengers), cumulatively, had availed of the services of Dream Folks.
Outside India
Having been partnered with other service providers, DreamFolks has established itself at 1,416 touch-points in 121 countries across the world out of which, 244 Touch-points are present in India and 1,172 touch-points overseas, as of March 31, 2022.
Financials of Dream Folks Services
The financials of the company are as below
| Period | Total Assets | Total Revenue | Profit After Tax (PAT) | Net Worth |
| 31st March, 20 | 137.76 | 367.81 | 31.68 | 65.51 |
| 31st March, 21 | 122.5 | 108.11 | -1.45 | 64.30 |
| 31st March, 22 | 168.68 | 283.99 | 16.25 | 82.16 |
Growth Opportunity of Airport Lounge Services Business
Number of Airports to be increased
As of 2022, there were about 130 operational airports in India, and this is expected to increase to 295 by 2040. The Government of India plans to spend around ₹1 lakh crore to set up new airports.
Number of Passengers to be increased
In April 2022, all Indian airports together handled 2.43 crore passengers. The passenger numbers are expected to rise to 29.3 crores (by 2025), 56.7 crores (by 2030), and 111.4 crores (by 2040), respectively.
Number of Airport Lounges to be increased
The number of lounges in an airport is proportional to the number of passengers it handles. The top 24 global airports average about 7 lounges per airport. Indian airports average 2 lounges per airport, as per regulatory filings, and only 8% of travelers eligible to access a lounge use the facility, and the penetration is very low.
India’s Indira Gandhi International Airport in New Delhi has 7 lounges, followed by Chatrapati Shivaji Maharaj International in Mumbai, which has 6 lounges. On average, the top 25 airports in India have only 2 lounges per airport.
As of 2021, the number of airport lounges in India is recorded to be 50. However, as per FICCI data, a statement by MoCA and Frost & Sullivan research, the number of airport lounges in India is expected to increase to 70-90 by the calendar year 2025, to 150-160 by 2030, and to 193 by 2040.
Passengers availing Lounge Facility increased
The number of passengers availing of lounge facilities has also increased from 51 lakh in FY2018 to 75 lakh in FY2020. The airport lounge access market in India is expected to grow at a CAGR of 43.11% by FY2030 to Rs 5,861.9 crore from Rs 358.9 crore in FY22.
Government Initiative
The government has been aiming for private investment of Rs 3,660 crore in airports by FY24. Presently, the AAI has approved the privatization of 6 major airports which include, Bhubaneshwar, Varanasi, Amritsar, Trichy, Indore, and Raipur. Therefore, the privatization of airports can be viewed as a key opportunity for lounge operators, as the upgradations for these airports are expected to enhance the overall customer travel experience.
Expected Investment Return in Aviation Sector
It is expected that every ₹ 100 invested in aviation is expected to generate an economic output of ₹325.
Dream Folks IPO Details
Dream Folks IPO Subscription Date
Dream Foks Services IPO will open for subscription on 24th August and close on 26th August.
Dream Folks IPO Allotment Date
The allotment date for Dreamfolks IPO is 5th September & the unsuccessful investors will get back their money on 2nd September.
Dream Folks IPO Listing Date
The listing date for Dreamfolks IPO in BSE & NSE is 6th September.
Dream Folks IPO Price Band
The company has fixed the price band minimum at Rs. 308 & maximum at Rs. 326 per share.
Dream Folks IPO Lot Size
The lot size of Dream Folks IPO is 46.
Dream Folks IPO Minimum Investment
Hence, an investor has to invest a minimum of Rs. 14,996/- (for 1 lot) and a maximum of 1,94,948 (for 13 lots).
Dream Folks IPO Objective Issue
- It is an offer for sale issue. the company will not receive any money through IPO. All the funds, excluding issue expenses, will go to selling shareholders.
- Hence, the object of the offer is just to carry out the offer for sale with the benefits of listing the equity shares on stock exchanges.
Investors’ Quota in IPO
Up to 75 percent of the issue size is reserved for qualified institutional buyers including anchor books, 10 percent for retail investors, and the remaining 15 percent for non-institutional investors.
Promoter Holding of Dream Folks
The promoters of Dream Folks are Liberatha Peter Kallat, Mukesh Yadav, and Dinesh Nagpal. Liberatha Peter Kallat, the Chairperson and MD of the company, has significant experience in the hospitality industry. She has worked with Indian and global MNCs such as Indian Hotels Company. At present, the 100% holdings are available to the promoter while post listing they will have 67% holding of the company jointly.
Should You Bid for Dream Folks IPO?
The airport lounge access market in India is expected to grow at a CAGR of 43.11% by FY2030. In this scenario, Dream folks have the first mover advantage in this field. Further, it enjoys a 95% market share in this business. Analysis of its financials suggests that the company is making profits (the figure for FY 21 can be ignored because of COVID 19 pandemic). Apart from that, the disposable income of the Indians is growing at a very faster rate, and more Indians are now traveling in flight. Due to increased disposable income, people are spending more on luxurious services. Under these circumstances, the Dreamfolks may be a good bet for the long term.
Conclusion
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