EaseMyTrip IPO Review 2021: The Easy Trip Planners IPO which opens on March 8th and closes on March 10, is one of the first digital company IPOs this year. In this article, we cover the EaseMyTrip (Easy Trip Planners) IPO Review and look into important IPO information and find out the possible prospects of the company. Let’s get started.
EaseMyTrip (Easy Trip Planners) IPO – About Company
Founded in 2008, Easy Trip Planners Ltd is an online travel agency which offers a range of travel-related products and services which includes flight tickets, train tickets, holiday packages, hotel booking, bus tickets, cab booking services, and other value-added services which include travel insurance, visa processing, etc.
The company has offices throughout the country including major cities like Noida, Bengaluru, Mumbai, and Hyderabad. The company has also expanded its presence globally and has offices located in Singapore, the UAE, and the UK.
History of EaseMyTrip
Easy Trip Planners offer their services through their website (EaseMyTrip) and their android and iOS mobile app. In its early years, the company started off with a B2B2C (business-to-business-to-customer) distribution channel. Here they provided travel agents access to their website in order to book domestic travel airline tickets to cater to the offline travel market in India.
By 2011 the company entered the B2C segment where they would directly assist clients in booking flight tickets through their website. By doing so they addressed the needs of the middle-class population of India by providing an easy-to-use alternative instead of travel agents.
In 2013 the company entered the B2E (business to enterprise) segment where they would provide their services to corporates. They also introduced hotel bookings and holiday packages to their customers. The following year Easy Trip Planners launched their Android application.
The company also has developed an in-house technology team that focuses on providing a secure, advanced, and scalable technological infrastructure.
EaseMyTrip IPO Review – Achievements
Over the years the company has grown in leaps and bounds. One of their biggest USPs has been the end-to-end service that they provide for all travel needs making their platform a one-stop destination for all travel needs. This has made Easy Trip Planners the second largest online travel agency in India in terms of gross revenue. In order to achieve this, they have entered into various agreements with third parties, including airlines, GDS and API service providers, channel managers, IRCTC, corporate customers, and IATA.
The company provides its clients access to 400 international and domestic flights along with 1.1 million hotels in India or abroad. As of March 2019, it had 49,494 registered travel agents across major cities of India.
The company has also achieved the feat of being the only profitable online travel agency among the key online travel agencies in fiscal years 2018, 2019, and 2020 in terms of net profit margin. The expansion of the internet and smartphones across the country will only increase the company’s growth potential.
EaseMyTrip in the midst of COVID-19
What is even more impressive is the company’s performance in the midst of the pandemic. They reported a revenue of Rs 50 crore in the nine months period ended in December 2020. They also managed to recover 70% booking volumes in the third quarter of Fiscal 2021, in terms of segments in comparison to the third quarter of Fiscal 2020.
EaseMyTrip IPO Review – Risks in the Company
One of the major weaknesses of the company is the industry it operates in. The operations of the Travel-related products and services get severely impacted in the case of pandemics which we already saw this year. The effects of COVID-19 are said to have a lasting impact on the industry.
The table above shows the breakup of the sources of the online ticketing segment. Here you can see that the industry is majorly dependent on Airline ticketing. Similarly, Easy Trip Planners too generates more than 90% of its revenue through air tickets booked on its website and mobile application. Any impact on the airline industry will be carried on to Easy Trip Planners.
The company is also dependent on its website and mobile application for operations. Failure to adapt to technological advances or glitches in the systems could disrupt their operations.
Key IPO Information for EaseMyTrip
| Particular | Details |
|---|---|
| IPO Size | ₹510 Cr |
| Fresh Issue | --- |
| Offer For Sale(OFS) | ₹510.00 Cr |
| Opening Date | Mar 8, 2021 |
| Closing Date | Mar 10, 2021 |
| Face Value | ₹2 per equity share |
| Price Band | ₹186 to ₹187 per equity share |
| Lot Size | 80 Shares |
| Minimum Lot Size | 1 |
| Maximum Lot Size | 13 |
| Listing Date | Mar 19, 2021 |
Mr. Nishant Pitti, Mr. Rikant Pittie, and Mr. Prashant Pitti are the company promoters. They have appointed Axis Capital and JM Financial as the leading book managers. KFin technologies Private Ltd. has been appointed as the registrar to the issue.
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EaseMyTrip IPO Review – Grey Market Premium
The IPO has received a positive response in the Grey Market. As of March 4, the shares of the company traded at a 96% premium over the issue price. This shows that the investors are bullish on the IPO.
EaseMyTrip IPO Review – Purpose of the Issue
The net proceeds from the issue will be used for –
- The company will not receive any proceeds from the issue. The IPO is entirely an offer for sale for founders Nishant Pitti and Rikant Pitti, who hold 49.81% and 49.68% stake, respectively. They will each sell holdings of ₹255 crores in the issue.
- They also aim to achieve the benefits of listing the equity shares of the company on stock exchanges.
EaseMyTrip Competitors in the Industry
Their competitors in the industry include:
- ClearTrip
- MakeMyTrip
- Yatra Online
- OYO
- Paytm
Closing Thoughts
Easy Trip Planners is one of the first digital company IPO this year which has shown to have great potential thanks to the reach of the internet. The company also has maintained a consistent financial track record.
Dinesh Gupta, Co-founder of UnlistedZone stated “ The IPO market is in high spirits. Every company is trying to tap the primary market with an initial public offering. The liquidity rush is allowing every issue to demand whimsical valuations,” It is important that investors do not jump along on the bullish trend but invest only after careful evaluation of the offer. Happy Investing!
Aron, Bachelors in Commerce from Mangalore University, entered the world of Equity research to explore his interests in financial markets. Outside of work, you can catch him binging on a show, supporting RCB, and dreaming of visiting Kasol soon. He also believes that eating kid’s ice-cream is the best way to teach them taxes.
