EaseMyTrip plans to raise Rs 1,500 crore through IPO

Travel booking site EaseMyTrip plans to raise Rs 1,500 crore ($210 million) through an initial public offer, potentially becoming the first company in the online travel booking space to list in India, according to people briefed on the matter. Rival MakeMyTrip, which is at least four times bigger than EaseMyTrip by revenue, listed on the Nasdaq in 2010 after a $70 million IPO. However, the New Delhi-based company founded by siblings Nishant and Rikant Pitti 10 years ago is profitable, unlike MakeMyTrip. Parent company Easy Trip Planners has held discussions with banks and law firms and the share sale may be scheduled in the second half of 2019. Banks that may be mandated for the IPO include State Bank of India, Kotak Mahindra and ICICI, according to the people. The founders expect the business to be valued at between Rs 6,000 crore and Rs 7,500 crore. The company is fully owned by the Pitti family. EaseMyTrip declined to comment on the IPO plan.

The travel booking site has curtailed spending on advertising and promotions and is focusing on B2B transactions such as bulk booking for air tickets, hotels and holiday packages from travel agents and supplementing revenue through tie-ups with companies. Its B2C business is said to be relatively smaller, although it is working to expand this segment.

Jaideep Ghosh, partner, KPMG, said valuations for IPOs of travel tech companies may be reasonable and may not be affected by issues such as cash burn, which has become the norm. “The online travel space looks interesting and there are enough indicators and enablers for that, such as increasing mobile penetration, more savvy customers and developments like voiceenabled search and bookings. Investors are cautious but generally the market is fine and cash burn is accepted,” he said.