With the outbreak of the pandemic globally and the resultant aftermath, it has changed the way we essentially function – right from how we interact, learn, socialise, work, travel, trade, communicate etc. As we emerge from the crisis, the world would look altered significantly, with some structural changes in the economy and society. With no recent precedent of this pandemic, the jury is still out on a whole range of changes being debated upon – whether the work economy will largely adopt a work-from-home culture? whether personal mobility will be preferred over shared mobility? whether online education will totally replace onsite schooling? whether outdoor activities like gym, malls, travel, restaurant, multiplexes will face business disruption forever and so on and so forth.
My personal belief is that barring a few activities which may change structurally, we will shift back to our earlier way of living and functioning, sooner than later. However, there is one activity (to my mind) that can NOT be substituted at all – leisure tourism.
Ever heard of an online holiday?
So, while we are able to conduct most of our regular routines (work, study, workouts, food, movie watching etc) from the ‘dis’comfort of home, ‘holidaying’ is something that all of us are completely devoid of. Travelling is a distinct human need; humans have a paradoxical and psychological disposition that makes them wish for contradictory change and stability conditions.
So, in my assessment, it’s only a matter of time before this industry will jump back (not limp back) to normalcy. ‘Revenge holidaying’ is also a very likely possibility, going by recent reports of how some tourist destinations and beaches etc were swamped with people once restrictions were lifted.
Now there are various ways to play the tourism theme in the capital markets, with most of them being asset heavy (airlines, hotels etc). However, I came across one industry, asset light, thru which this theme could be played – outsourcing services. Within outsourcing, one listed company that drew my attention was BLS International Ltd., one of the top 3 players w.r.t. global passport / visa / consular services.
Read the attached note hereunder to know what I gathered about the company.