DreamFolks Analysis

DreamFolks (DFS) is the leading aggregator and technology platform for airport services in India. It connects lounges and premium airport facilities with users of bank credit/debit cards. DFS holds a dominant market share of over 75% in domestic airport lounges and is the exclusive provider with 100% coverage of airport lounges. The company is a preferred partner for banks aiming to offer complimentary access to paid airport services, presenting a profitable and asset-light model.

The anticipated growth in the Indian airline industry, driven by competitive pricing, increased leisure travel, new airports, and government initiatives, is expected to benefit DFS. The rising popularity of bank cards, which offer lounge access as a key benefit, is boosting DFS’s pay-per-use revenue model. Despite facing near-term challenges due to revised airport charges and a shift to a spending-based model, DFS is projected to achieve a robust 20% revenue and 28% PAT (Profit After Tax) CAGR over FY24E-26E.

The company is also exploring international markets as a lucrative long-term opportunity with significant potential value. The stock is initiated with a BUY rating and a target price of INR650, suggesting a potential upside of 34%.