Current Rating and Its Significance
MarketsMOJO’s 'Hold' rating for Yatra Online Ltd indicates a cautious stance, suggesting that investors should neither aggressively buy nor sell the stock at this time. This rating reflects a balanced view of the company’s prospects, where strengths in certain areas are offset by challenges in others. The rating was adjusted on 29 December 2025, when the Mojo Score declined from 71 to 61, signalling a moderation in the stock’s appeal compared to its previous 'Buy' status.
Quality Assessment
As of 12 February 2026, Yatra Online Ltd’s quality grade is assessed as average. The company’s return on equity (ROE) stands at a modest 4.60%, indicating relatively low profitability generated from shareholders’ funds. This level of ROE suggests that while the company is generating returns, it is not yet delivering strong value creation for investors. Additionally, the company maintains a low debt-to-equity ratio, effectively zero, which reduces financial risk but also implies limited leverage to amplify returns.
Valuation Perspective
The valuation grade for Yatra Online Ltd is considered fair. Currently, the stock trades at a price-to-book (P/B) ratio of approximately 2.9, which is at a discount relative to its peers’ historical averages. This suggests that the market is pricing the stock conservatively, possibly reflecting concerns about growth sustainability or profitability. Despite this, the company’s price-earnings-to-growth (PEG) ratio is notably low at 0.2, signalling that the stock’s price growth is not fully aligned with its earnings growth potential, which could be attractive for value-oriented investors.
Financial Trend Analysis
The financial trend for Yatra Online Ltd is positive, supported by robust growth in key metrics. As of 12 February 2026, net sales have expanded at an annual rate of 56.74%, while operating profit has surged by 101.05%. The company has reported very positive results for the last five consecutive quarters, with net sales for the nine months ending December 2025 reaching ₹779.65 crores, growing 75.25% year-on-year. Profit after tax (PAT) for the same period stood at ₹45.50 crores, reflecting a remarkable growth of 168.91%. Operating cash flow, although negative at ₹-88.65 crores annually, is the highest recorded, indicating increased operational activity and investment in growth.
Technical Outlook
Technically, the stock exhibits a mildly bullish trend. Despite recent short-term volatility, including a 6.92% decline on the latest trading day and a 13.99% drop over the past month, the stock has delivered a strong 63.30% return over the past year. This suggests underlying investor confidence and momentum, although caution is warranted given the recent downward price movements. The year-to-date performance remains negative at -19.34%, reflecting some pressure in the early months of 2026.
Investor Participation and Market Sentiment
One notable concern is the declining participation of institutional investors. Over the previous quarter, institutional holdings decreased by 1.29%, now constituting 16.18% of the company’s shareholding. Institutional investors typically possess superior analytical resources and tend to adjust their positions based on fundamental assessments. Their reduced stake may signal reservations about the stock’s near-term prospects, which investors should consider alongside other factors.
Summary for Investors
In summary, Yatra Online Ltd’s 'Hold' rating reflects a nuanced investment case. The company demonstrates strong revenue and profit growth, supported by positive financial trends and a conservative capital structure. However, modest profitability ratios, fair valuation metrics, and recent technical volatility temper enthusiasm. Investors should weigh these factors carefully, recognising that the stock currently offers moderate risk and reward potential. The 'Hold' rating advises maintaining existing positions while monitoring developments closely rather than initiating new positions aggressively.
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Performance Overview
Examining the stock’s recent price performance as of 12 February 2026, Yatra Online Ltd has experienced mixed returns. The one-day decline of 6.92% and one-month drop of 13.99% contrast with a positive six-month return of 1.72% and a strong one-year gain of 63.30%. Year-to-date, the stock is down 19.34%, reflecting some short-term headwinds. These fluctuations highlight the importance of a measured approach, consistent with the 'Hold' rating.
Sector Context and Market Capitalisation
Operating within the Tour and Travel Related Services sector, Yatra Online Ltd is classified as a small-cap company. This positioning often entails higher volatility and growth potential compared to larger, more established peers. The sector itself is sensitive to macroeconomic factors such as consumer discretionary spending, travel demand, and geopolitical developments. Investors should consider these external influences alongside company-specific fundamentals when evaluating the stock.
Outlook and Considerations
Looking ahead, Yatra Online Ltd’s ability to sustain its impressive sales and profit growth will be critical. Maintaining operational efficiency to improve ROE and converting growth into consistent cash flows will enhance investor confidence. Additionally, monitoring institutional investor behaviour and broader market trends will provide valuable signals for future rating reassessments. For now, the 'Hold' rating suggests a wait-and-watch approach, balancing the company’s growth achievements against valuation and profitability challenges.
Conclusion
Yatra Online Ltd’s current 'Hold' rating by MarketsMOJO, last updated on 29 December 2025, reflects a comprehensive evaluation of quality, valuation, financial trends, and technical factors as of 12 February 2026. Investors are advised to maintain existing holdings with a cautious outlook, recognising both the company’s growth potential and the risks inherent in its current financial and market position.
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