ICICI Securities has reiterated a “BUY” recommendation on Wonderla Holidays Ltd., assigning a 12-month target price of Rs 645, implying an upside potential of nearly 27% from the current market price of Rs 507. The brokerage believes the company is entering a fresh growth cycle, supported by the rapid scale-up of its Chennai amusement park, improving operational trends across legacy parks, and expanding non-ticket revenues. Stronger operating leverage, premiumisation initiatives, and improving EBITDA margins are expected to drive earnings momentum over FY27-FY28. ICICI Securities expects Wonderla to emerge as one of the strongest discretionary consumption plays within India’s entertainment and leisure sector.

Wonderla Delivers Robust Q4FY26 Performance Amid Chennai Ramp-Up

Wonderla Holidays posted a sharp operational recovery in the March quarter, with consolidated revenues surging 40.4% year-on-year to Rs 135.8 crore, primarily driven by the newly launched Chennai park and strong traction in its hospitality business. EBITDA more than doubled to Rs 40.2 crore compared to Rs 19.7 crore in the same period last year, while EBITDA margins expanded sharply to 29.6% from 20.4%.

Adjusted profit after tax climbed 24.4% YoY to Rs 13.7 crore despite elevated depreciation costs linked to the Chennai park commissioning. Average revenue per user (ARPU) increased 7% YoY to approximately Rs 1,465, highlighting the company’s success in extracting higher spend per visitor through premium experiences and non-ticket offerings.

Chennai Park Emerging as the Next Growth Engine

The Chennai amusement park has quickly become the company’s biggest growth catalyst. In its first full quarter of operations, the park attracted nearly 1.91 lakh footfalls and generated revenues of Rs 29.4 crore. Management indicated that the response from consumers has exceeded expectations despite Chennai already being a competitive entertainment market.

The park also reported EBITDA margins of roughly 30% during the quarter, which analysts believe could eventually exceed 40% as operations mature over the next three to four years. Wonderla expects Chennai footfalls to eventually approach 10 lakh annually after stabilization.

ICICI Securities believes Chennai could eventually rival Bengaluru, currently the company’s flagship park, in both scale and profitability. The brokerage expects this property to remain the single largest contributor to consolidated growth over the medium term.

Legacy Parks Showing Signs of Recovery

Operational trends across older parks are also beginning to improve. Kochi returned to positive growth territory during Q4FY26, while Bhubaneshwar recorded a strong recovery aided by revised marketing strategies and sales execution. Hyderabad, however, remained under pressure due to weather-related disruptions and weak school-group traffic during FY26.

Management clarified that Hyderabad’s weakness was largely temporary and expects a recovery beginning FY27. Over the longer term, Wonderla believes Hyderabad has the potential to achieve footfall levels comparable to Bengaluru due to favorable city demographics and rising brand recognition.

The Bhubaneshwar park is expected to witness meaningful scaling over the next few years, with management targeting approximately 2.5 lakh footfalls in FY27 and up to 3.5 lakh footfalls over the medium term.

Non-Ticket Revenues Becoming a Structural Growth Driver

One of the most notable trends in Wonderla’s business model is the increasing contribution of non-ticket revenues. Food and beverages, premium experiences, merchandising, resort stays, and value-added services are steadily contributing a larger share of revenue. The company indicated that non-ticket revenues currently account for roughly 30% of total revenues and could rise to 40-50% over the next four to five years.

This shift is strategically important because non-ticket revenues generally carry superior margins and reduce dependence on seasonal ticketing income. During Q4FY26, non-ticket ARPU growth outpaced ticket revenue growth across most parks.

The Bengaluru resort business also delivered its strongest-ever quarterly performance, with revenues rising 84% YoY to Rs 7 crore, aided by improved occupancy trends and the addition of a new resort extension called “The Isle.” Average daily room rates increased 26% YoY to Rs 6,797.

Margins Expected to Expand Significantly Over FY27-FY28

ICICI Securities expects Wonderla’s profitability profile to strengthen materially over the next two years. Mature parks are already generating EBITDA margins of 40-45%, and Chennai is expected to gradually move toward similar levels as scale improves.

The brokerage projects EBITDA margins to rise from 31.7% in FY26 to nearly 40.4% by FY28. Revenue is estimated to grow at a CAGR of nearly 21% between FY26 and FY28, while EBITDA could expand at a significantly faster pace due to operating leverage benefits.

Below is ICICI Securities’ projected financial outlook for Wonderla Holidays:

Expansion Strategy Remains Intact Despite Controlled Capex

Wonderla management remains ambitious on long-term expansion. The company currently operates five amusement parks and intends to expand the network to nearly 10 parks over time. Discussions are underway with multiple state governments for future projects in cities such as Mumbai, Delhi, and Ahmedabad.

However, management emphasized that land aggregation, regulatory approvals, and water availability remain crucial considerations before greenlighting any new development. Importantly, the company does not intend to undertake aggressive capital expenditure during FY27, with maintenance and sustaining capex estimated at around Rs 35-40 crore.

Valuation Outlook and Investment View

ICICI Securities values Wonderla Holidays at 11x FY28E EV/EBITDA and maintains a target price of Rs 645 with a “BUY” rating. Analysts believe the company offers a compelling combination of structural growth, improving profitability, and rising monetisation opportunities within India’s expanding discretionary consumption landscape.

The brokerage also highlighted that earnings estimates for FY27 and FY28 were marginally reduced to account for higher depreciation expenses linked to the Chennai park rollout. Nevertheless, operational growth assumptions remain largely intact.

Key risks to the investment thesis include unseasonal rainfall during holiday seasons, macroeconomic slowdowns impacting discretionary spending, and delays in future park expansion projects.

For long-term investors, Wonderla appears positioned at the intersection of India’s rising discretionary spending cycle and experiential entertainment demand. If Chennai continues its strong trajectory while mature parks recover steadily, the company could witness a meaningful rerating over the next two years.