YATRA ONLINE INC C/WTS 16/12/21 (OTCMKTS:YTROF) On A Bull Run

Did you see the astonishing movement of YATRA ONLINE INC C/WTS 16/12/21 (OTCMKTS:YTROF)? So far this year, this security went from trading at around $0.50 to be exchanged for $1.75. It means that it delivered returns of as much as 250% in less than six months. We will explain you ins and outs about this stock, and the reasons behind such huge returns.SourceYTROFYTROF is a warrant that the company “Yatra Online, Inc.” issued on December 30, 2016. It is actually a stock that copies the performance of the common stock of Yatra Online, Inc. The market usually appreciates these type of issues, because they offer leverage. What does it mean? Market participants interested in making an investment in Yatra Online, Inc. can use YTROF. The expositions to the movement of the stock will be larger. Hence, we can get bigger returns as well as high risk.In 2017, the common stock only returned 25%, while YTROF returned 250%. That is the way the leverage in YTROF operates.Yatra Online, IncYatra operates the online website Yatra.com. It is an Indian travel company founded in 2006. It is considered as the second largest travel website in India. It has approximately 5.2 million cumulative customers as of Mar 31, 2017, and gross bookings of 69.1 billion during fiscal year 2017. The figures are impressive, but the most important is the growth of the business. That is the fact that, we believe, is making the market push up the share price. Its growth is astonishing. The gross booking shows a CAGR of close to 19% in the period 2014-07. Additionally, the revenues less service cost has been close to 25% in the same period.SourceHow does the company explain the growth? The company seems to be doing things very well, but the fantastic growth is not driven by operating efficiency. In this presentation to investors, Yatra notes that the consumer growth of India is doing exactly what China did in the past; growing dramatically. Additionally, the Indian air travelling grew by 21% in the period 2015-201. Furthermore, the smartphone ownership's CAGR is 49% and the online hotel bookings are growing at a CAGR close to 18%. With all this in mind, it is easy to explain the numbers reported by the company.Recent DevelopmentsThe most interesting information put out about Yatra was that the Deutsche Bank had initiated coverage on it. The target price? $15 a share. That is a 30% increase from the current share price as of July 10, 2017.What are the reasons that Deutsche Bank gave? The bank said that its multi-channel platform is the key to the business:

"Its multi-channel platform is the primary source of competitive advantage, making it well positioned to benefit from India's rising internet penetration (34% of population) and online travel bookings (35% of travel bookings). We believe that with its healthy mix of B2C (70% of revenues) and B2E+B2B2C (30% of revenues) customers, it will continue to gain share in India’s online travel market." Source

In addition, on May 16, 2017, the company put out the earnings results for the first quarter of 2017. The CEO commented the results, and remarked the fantastic growth rate, the air travel industry growth, and the mobile traffic. In our opinion, these were the most outstanding growths:

"I am delighted to share that we closed out fiscal year ended March 31, 2017 on a positive note with the fourth quarter, which was our first full quarter as a public company, witnessing a significant ramp up in growth rate. The domestic air travel industry in India actually grew 19% in passenger volumes in the fourth quarter, making India one of the fastest growing aviation markets in the world. Our growth continued to outpace industry growth. Mobile traffic also scaled up rapidly with 72% of our traffic coming from mobile devices in the fourth quarter up from 67% in third quarter." Source

Solid Financial Situation and InsidersBesides its phenomenal growth, we also like its balance sheet. The company shows tons of assets including cash and very little debt:

• Cash And Cash Equivalents: $1,533 million
• Short Term Investments: $2,002 million
• Total Assets: $9,574 million
• Total liabilities: $6,385 million
• Long Term Debt: $0.23 million

We were not the first to figure out the situation of the company. The following shareholder declared a large position in the stock. It was acquired at the end of 2016. Big returns were obtained.InsiderTransactionTypeValueDateShares

MACQUARIE GROUP LTDBeneficial Owner (10% or more)

Statement of OwnershipIndirectDec 15, 20162,324,355SourceConclusionYTROF offers the opportunity to profit from the upward trend of Yatra Online, Inc. The leverage incorporated in that security is multiplying the returns delivered by the share price of Yatra. In this article we reviewed Yatra and saw that Deutsche Bank believes that the share price should be trading closer to $15.00. That would mean a 30% jump in the stock, and something much larger in the YTROF. Furthermore, we saw that the financial information provided by the company shows astonishing growth, plenty of cash, and little debt. Finally, some savvy shareholders recently bought large stakes. To sum up, there's a lot to like with YTROF and this bull run looks set to continue.We will be updating our subscribers as soon as we know more. For the latest updates on YTROF, sign up below!Image courtesy of FlickrDisclosure: We have no position in YTROF and have not been compensated for this article.