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|In the press release dated July 12th, 2023, Destination Italia SpA, Italy’s leading travel tech company, a leader in quality incoming and experiential tourism for international tour operators and travel agencies, listed on Euronext Growth Milan, announced, as of majority shareholder of the subsidiary company Pavoneggi Srl, that it has signed an agreement aimed at increasing its shareholding in Pavoneggi with the company’s minority shareholders: F. A. Travel Srl and 3 C Srl.|
As a result of the signing of this agreement, Destination Italia, which, after the merger of Portal Sardegna, already held 51.3% of Pavoneggi Srl, will observe an increase in its shareholding, which will be equal to 70.0% of the subsidiary’s share capital. The minority shareholders, F. A. Travel Srl and 3 C Srl, will be entitled to 20.9% and 9.1% of Pavoneggi’s capital, respectively.
At the same time, the Parent Company has signed, with Pavoneggi, an agreement aimed at the development, adaptation and integration of HubCore within the Destination Italia Group. This is the all-in-one technology platform, developed ad-hoc for the tourism sector and which will allow a substantial improvement of the IT systems for the management of the Group’s Incoming activities.
The Parent Company’s strategy in carrying out these two operations is aimed at obtaining several advantages, including the internalization of margins (resulting in a greater impact on equity value), a substantial increase in operational and managerial flexibility, and, finally, the opportunity to develop the Group’s strategic policies, related to the IT area, more rapidly. Management’s plans for the near future call for the platform to be further developed through Artificial Intelligence in order to fully exploit the wide range of features regarding the Group’s booking and administration management systems, relative to both the B2B and B2C channels. Among the various planned activities, we point out the creation of the trip builder, i.e., the system that will enable streamlining in the composition of tailor-made travel quotes, speeding up the processing process and increasing, as a result, the ability to respond to customers in a timely manner. Finally, IT activities will affect the process of technically integrating AI capabilities into online platforms with the aim of improving booking processes and offering a high-quality service, which is clear, simple and fast.
As for the HubCore platform, it has been developed thanks to more than 10 years of work by Pavoneggi Srl and contains various highly innovative features for the sector, including:
features aimed at OTAs, specifically designed for the business areas of booking, content management, administration and marketing, and that allow to sell various types of tourism products in B2C mode. Developments in these functions, which have affected the last few years, have led to the implementation of the Digital Warehouse aimed at tourist experience services (a section that allows the industrialization of the process of creating tourist experiences and packages starting from the classification of attractors and their transformation, by means of the Product Factory, into tourist raw materials) and Smart Dynamic Packaging, which allows the dynamic production of Smart Trips, in order to provide a service in a cost-effective way, to target customers that would be, otherwise, little profitable;
features aimed at hotel facilities, including the management of rates, discounts, rules and restrictions that allow to diversify and elevate the pricing and distribution strategy, as well as the centralized management of communication flows between the booking department and customers;
features aimed at DMCs/DMOs, who are offered a Destination Management Software whose use is aimed at managing content that presents the destination, which are perfectly integrated with the tourist offer and various services, such as hotels, holiday homes, transfer services, activities and travel experiences and other generic tourist services.
Taking into account the press release, we confirm our estimates: recommendation Buy, Target Price € 2.90 and Medium risk.