MakeMyTrip, the dominant online travel agency in India, filed for an initial public offering and hopes to raise up to $100 million for geographic expansion, strategic investments or acquisitions, and technology enhancements.
Shares would be listed on Nasdaq stock market under the stock symbol MMYT.
MakeMyTrip, headquartered in Gurgaon, Haryana, India, didn’t reveal any range of pricing for its IPO or how many share would be issued. Those details would come in subsequent filings with the Securities and Exchange Commission.
Philip Wolf, an independent board member of MakeMyTrip and a Tnooz board member, says “MakeMyTrip’s IPO demonstrates India’s continuing explosive growth, that the power of online travel knows no borders and the management team has built a world-class business.”
It’s been several years since there has been big-time IPO from an online travel agency and, if successful, MakeMyTrip’s public offering could spur others, particularly from Asia-Pacific OTAs seeking to spread their brand.
Founded in 2000 with an initial focus on the nonresident Indian market in the U.S., MakeMyTrip launched an Indian website in 2005, and now provides access to all of India’s full-service domestic and low-cost carriers, as well as major airlines operating to and from India. The OTA says it offers 4,000 hotels inside India, many hotels outside the country, Indian Railways and major bus operators.
MakeMyTrip recorded operating losses of $10.6 million and $6 million in 2009 and 2010, respectively.
When excluding service costs, MakeMyTrip attracted $31.1 million in revenue from domestic air tickets in fiscal year 2010.
It took in $8 million in revenue from hotel and package bookings, accounting for 19.8% of total revenue in fiscal year 2010, when excluding service costs.
MakeMyTrip says its strategy is to expand its hotel and package offerings, increase cross-selling, grow its travel agency distribution, better its service offerings through technology improvements, broaden its reach into new geographic markets “and pursue selective strategic partnerships and acquisitions.”
Disclosure: Alongside Wolf, Tnooz chairman Frederic Lalonde is also a MakeMyTrip board member.
It looks to be a pretty interesting play to IPO right now when times are tough especially on certain sectors of the travel industry. If anyone can do it though they seem to be a pretty good bet with their stronghold in a market that wasn’t hit as hard by the global recession.
Read through the MMT filing. I think it’s a great company and very sellable story – but I had a few questions for them:
a) They add hotel gross revenue to airline net commissions to calculate total revenue. Is that normal?
b) They state that ~95% of their bookings come from their website, whereas almost 50% of bookings for Indian travel portals happen over the phone since with the 5M visitors they do monthly, it would imply a conversion rate of 10% for those numbers to add up.
c) They are still losing money and the IPO seems to be primarily for expansion / acquisition and not for investor exit – What’s the story they are selling for the future ? where is the next wave of growth gonna come from ? What are the 2011 projections?
Tanmay
stole our footer pictures of the greatest location throughout the world. Large company like this stole a design. that is funny
@travelsync – maybe “stole” is the wrong word, maybe? who owns the copyright?
but, yes indeed the designs are remarkably similar
use stole, borrow, what ever you called it. Copyright? Didn’t even have enough money to pay the photoshop design that did it as i watch him and provided the idea. Just proud to see one of India’s largest travel company likes my idea.