Le Travenues Technology (ixigo) is a technology company
empowering Indian travelers to plan, book and manage their trips across rail,
air, buses, and hotels. The company assists travelers in making smarter travel
decisions by leveraging artificial intelligence, machine learning, and data
science-led innovations on its online travel agency (OTA) platforms, comprising
websites and mobile applications. The OTA platforms allow travelers to book
train tickets, flight tickets, bus tickets, and hotels.
ixigo is the OTA for the ‘next billion users’, with
its focus on localized content. The apps aim at solving problems of Tier II and
III travelers. As of 31 December 2023, there were 213.21 million registered
users, i.e., users who had provided their unique mobile number or email
address, as applicable, on the ixigo platforms as of the relevant date. As of
March 31, 2024, the company had 429.38 million annual active users. ixigo has
the highest app usage among OTAs, with 83 million monthly active users
cumulatively across its apps. In September 2023, ixigo recorded 4.9 million
monthly app downloads, as per data.ai. This was more monthly app downloads than
all other OTAs in that month.
In September 2023, ixigo flights, ixigo trains,
ConfirmTkt, and AbhiBus collectively saw the highest usage and engagement among
all key OTA players. Standalone transactional train mobile apps in India had
the highest monthly active users and sessions. It is the largest Indian train
ticket distributor in the OTA rail market, with a share of around 51% in terms
of rail bookings among OTAs as of 31 March 2023. Its market share in the OTA
rail market in India was 46.15% in FY2023 and increased from 46.4% in H1 of FY
2023 to 52.4% in H1 of FY2024. Bus-focused app AbhiBus was the second largest
bus-ticketing OTA in India, with a 11.5% share in online bus ticket bookings in
FY2023. The share increased to 12.5% in H1 of FY2024. The share by volume was
nearly 5.2% of the total India airline OTA market in H1 of FY2024, up from 3.3%
in FY2023.
As many as 49.07 million transactions were booked
through the OTA platforms in FY2023. As many as 42 million transactions were
booked through the OTA platforms in the nine months ended December 31, 2023.
Object of the
offer
The IPO consists of a fresh issue of Rs 120 crore and 6,66,77,674
equity shares through OFS.
Out of the proceeds from the fresh issue, Rs 45.0
crore will be used to fund the working capital requirements, Rs 25.8 crore
towards investment in cloud infrastructure and technology, and the balance to
fund inorganic growth through unidentified acquisitions and other strategic
initiatives and for general corporate purpose.
Strengths
Leading OTA for the ‘next billion users’ with the
highest monthly active users (MAU) for mobile apps across all key OTAs as of
September 2023.
The fastest growing OTA in India by revenue from
operations between FY2020 and FY2023. The number of transactions booked through
the OTA platforms increased at a CAGR of 139.43% from 8.56 million in FY 2021
to 49.07 million in FY2023, and to 42 million and36.47 million in the nine
months ended December 2023 and December 31, 2022, respectively.
Technology forms the basis for operating leverage and achieving
significant efficiencies in business processes and operations. Uses artificial
intelligence, data science and machine learning to transform travel information
and crowd-sourced data into business intelligence to enhance travel offerings.
Established consumer travel brands with user-first
approach. The apps were one of the highest rated apps among OTAs, with a rating
of 4.6 on the Google Play Store as of November 2023. The apps had the highest
usage and engagement among all key OTA players. Brand presence and loyalty
among users is evident from the monthly active users increasing from 21.59
million in March 2021 to 44.20 million in March 2022, 62.83 million in March
2023 and 77.04 million in December 2023. The repeat transaction rate was 86.06%
and 85.14% in the nine months ended December 2023 and in FY2023, respectively.
The business model consists of a comprehensive mix of
product and service offerings with presence across trains, flights, buses and
hotels businesses to comprehensively addresses the online travel market in
India and monetize all aspects of the OTA platforms.
Led by an experienced leadership team with significant
industry experience. Chairman and Managing Director Aloke Bajpai holds a B Tech
in electrical engineering from IIT, Kanpur, and an MBA from INSEAD. Director
and Group Co-Chief Executive Officer Rajnish Kumar holds a BTech degree in Computer
Science and Engineering from IIT, Kanpur. They have worked with Amadeus SAS in
France and possess over 22 years of experience in travel technology.
Weaknesses
Commenced operations as a meta search website and
subsequently transitioned to become an OTA. As such has limited experience of
operating as an OTA.
The train ticketing services depend on the agreement
with IRCTC. Termination of the agreement could end the train ticketing services
and have a material adverse effect on the business.
The arrangement with IRCTC is on a non-exclusive basis.
IRCTC may engage with other distribution partners, including competitors.
Any failure to maintain satisfactory performance of
the technology infrastructure, including the OTA platforms, could lead to disruptions
in the services and materially affect business operations.
Incurred net losses in the past and anticipates
increased expenses in the future. Any loss going ahead could adversely affect
the operations and financial condition.
Subject to privacy regulations. Compliance with these
regulations could impose a significant compliance burden.
Launched products and features such as ixigo Assured,
ixigo Assured Flex and Abhi Assured to improve customer experiences. Intends to
continue offering new features and products. The business could be hit if the
roll-out of new products and services, features, improvements and strategies does
not meet the objectives or customer expectations.
Failure to maintain and enhance brands ixigo,
ConfirmTkt, and AbhiBus or the quality of customer service could lead to
difficulty in maintaining existing and acquiring new users and business partners.
The Indian tours and travel industry is highly
fragmented, with many small un-organized tour operators as well as established
players, resulting in intense competition within the tourism space.
The covid-19 pandemic, or any future pandemic or
widespread public health emergency, could affect the financial condition.
Negative cash flow from operation stood at Rs 34.4
crore in FY 2022 and Rs 15.2 crore in FY2021.
The business depends on its relationships with a broad
range of travel suppliers. Any adverse changes in these relationships or
inability to enter new relationships could affect the business.
Valuation
In the nine months ended December 2023, consolidated
sales were up 34.78% to Rs 491.02 crore. The OPM increased 152 bps to Rs 28.24
crore. OI decreased 57.84% to 6.08 crore. Interest cost was up296.36% to Rs 2.39
crore. Also, depreciationrose34.02% to 10.31 crore. PBT before exceptional
items declined by 12.77% to Rs 18.78 crore. Net profit surged 289.81% to Rs 66.80 crore as
against net profit of Rs 17.14 crore.
In FY 2023, consolidated sales were up 32.1% to Rs
501.25 crore. OP turned positive to Rs 28.72 crore as against an operating loss
of Rs 12.32 crore. OI increased by 204.5% to 16.32 crore. Interest cost jumped
66.1% to Rs 6.53 crore. Depreciation was higher by 37.9% to Rs 10.82 crore. PBT
before exceptional items stood at Rs 33.28 crore as against loss of Rs 17.6
crore. Provision for tax was credit of Rs 2.72 crore as against expense of Rs
3.49 crore. Net profit stood at Rs 21.64 crore as against a net loss of Rs
24.38 crore.
At the higher price band of Rs 93, the offer is made
at around 100 times P/ TTM EPS, 5.6 times EV/ TTM sales, and 84 times EV/TTM Ebitda.
The listed industry peers are Easy Trip Planners and
Yatra Online. Easy Trip Planners offers a comprehensive range of travel-related
products and services under the flagship brand Ease My Trip. Yatra Online
provides information, pricing, availability, and booking facilities for
domestic and international customers.
In comparison Easy Trip Planners trades at 70 times
its P/ TTM EPS, 11.9 times EV/TTM sales and 33.6 times EV/TTM Ebitda. Yatra
Online is trading at 347.2 times its P/TTM EPS, 4 times EV/TTM sales and 112.3
times EV/ TTM Ebitda.
Le Travenues Technology: Issue
highlights
|
For Fresh Issue Offer size (in no
of shares )
|
|
- On lower price band
|
1,36,36,364
|
- On upper price band
|
1,29,03,226
|
Offer size (in Rs crore)
|
120.0
|
For Offer for Sale Offer size (in
no of shares )
|
|
- On lower price band
|
6,66,77,674
|
- On upper price band
|
6,66,77,674
|
Offer size (in Rs crore)
|
586.8-620.1
|
Price band (Rs)
|
88-93
|
Minimum Bid Lot (in no. of shares
)
|
161
|
Post issue capital (Rs crore)
|
|
- On lower price band
|
38.82
|
- On upper price band
|
38.74
|
Post-issue promoter & Group
shareholding (%)
|
-
|
Issue open date
|
10-06-2024
|
Issue closed date
|
12-06-2024
|
Listing
|
BSE, NSE
|
Rating
|
40/100
|
Le
Travenues Technology: Consolidated Financial
|
|
2103 (12)
|
2203 (12)
|
2303 (12)
|
2212 (9)
|
2312 (9)
|
Sales
|
135.57
|
379.58
|
501.25
|
364.31
|
491.02
|
OPM (%)
|
2.44
|
-3.24
|
5.73
|
4.23
|
5.75
|
OP
|
3.30
|
-12.32
|
28.72
|
15.41
|
28.24
|
Other inc.
|
2.84
|
5.36
|
16.32
|
14.41
|
6.08
|
PBIDT
|
6.14
|
-6.95
|
45.05
|
29.83
|
34.32
|
Interest
|
1.55
|
2.80
|
0.95
|
0.60
|
2.39
|
PBDT
|
4.59
|
-9.76
|
44.10
|
29.22
|
31.92
|
Dep.
|
1.89
|
7.84
|
10.82
|
7.69
|
10.31
|
PBT
|
2.71
|
-17.60
|
33.28
|
21.53
|
21.61
|
Share of profit/loss from JV
|
0.00
|
0.00
|
0.00
|
0.00
|
-2.83
|
PBT Before EO
|
2.71
|
-17.60
|
33.28
|
21.53
|
18.78
|
Exceptional items
|
-
|
-
|
-12.61
|
-7.13
|
29.72
|
PBT After EO
|
2.71
|
-17.60
|
20.67
|
14.40
|
48.50
|
Total Tax
|
-4.83
|
3.49
|
-2.72
|
-4.26
|
-17.21
|
PAT
|
7.53
|
-21.09
|
23.40
|
18.66
|
65.71
|
Minority Interest
|
0.35
|
3.29
|
1.76
|
1.53
|
-1.09
|
Net Profit
|
7.19
|
-24.38
|
21.64
|
17.14
|
66.80
|
EPS (Rs)*
|
0.2
|
-0.6
|
0.9
|
#
|
#
|
EPS is on post issue equity capital of Rs 38.74 crore of face
value of Rs 1 each
|
Figures in Rs crore
|
Source: Le Travenues Technology
Issue Prospectus
|
|