Yatra Online IPO Review: Yatra Online Limited is coming up with its Initial Public Offering. The IPO will open for subscription on September 15, 2023, and close on September 20, 2023.
In this article, we will look at Yatra Online IPO Review 2023 and analyze its strengths, weaknesses, financials and GMP. Keep reading to find out!
Table of Contents
Yatra Online IPO Review – About The Company
Yatra Online Limited, incorporated in 2005, offers domestic and international customers information, pricing, availability, and booking services.
As of FY23, the company offered domestic and international air ticketing on Indian and international airlines, as well as bus ticketing, rail ticketing, cab bookings, and ancillary services within India, hotels, homestays, and other lodging bookings, with approximately 105,600 hotels in 1,490 cities and towns in India.
Through its website yatra.com, mobile applications, corporate SaaS platform, and other associated platforms, the company also provides more than two million hotels worldwide.
Yatra Online has contracts with over 94,000 hotels and homestays in approximately 1,400 cities across India, as well as more than 2 million hotels worldwide. The company operates India’s largest domestic hotel platform. Yatra Online recently launched Yatra Freight, a freight forwarding company, to expand its corporate service offerings.
The clientele of the company includes both B2B and B2C customers, allowing it to target India’s most frequent and high-spending travellers, namely educated urban consumers.
The company currently has more than 813 corporate clients and over 49,800 registered small and medium-sized enterprise customers as of fiscal year 2023. It is ranked as the third biggest online travel company in terms of gross booking revenue and has the largest number of hotel and accommodation partnerships compared to other domestic OTA players, with over 2,105,600 tie-ups.
Yatra Online IPO Review – Industry Overview
India is a popular travel destination, and its tourism and hospitality industry is a key driver of growth in the service sector.
The travel industry in India is anticipated to experience a CAGR of 9-11%, resulting in a significant expansion to ₹4,540-4,560 billion by FY28 from ₹2,825-2,845 billion in FY23. This growth would be attributed to the advancements made in tourism infrastructure, higher income levels that translate to increased spending on travel and tourism, and an upsurge in business and leisure travel frequency.
It is predicted that the travel industry’s online presence will increase to 73-75%. This growth is expected to result in an estimated ₹3,355 billion online travel market in India by FY28, up from ₹1,900-1,920 billion in FY23, with a CAGR of 11.5%-12.5%. The share of Online Travel Agencies (OTAs) in the online travel market is expected to grow at a quicker pace compared to captive players.
Yatra Online IPO Review – Financial Highlights
If we look at the financials of Yatra Online we find out that their assets have increased from ₹562.91 crores in March 2021 to ₹681.25 crores in March 2023.
The revenues of the company indicate a good recovery post Covid increasing four folds from ₹143.62 crores in March 2021 to ₹397.47 crores in March 2023. During the same period, the company turned its losses into profits and reported a net profit of ₹7.63 crores in FY23.
In terms of return ratios, it has a ROE of 18.1% and a RoCE of 26% as of FY23. These ratios indicate a good return to shareholders’ capital and an efficient use of company resources. Furthermore, the company’s debt has increased ten times from ₹13.11 crores in FY21 to ₹153.07 crores in FY23.
Financial Metrics
Peers of the Company
The following image will show you the peers of the company along with their important metrics:
Strengths of the Company
- The company has established a large customer base serving over 14 million cumulative travel customers as of March 31, 2023.
- The company’s strategy combines B2C and B2B to cross-sell to both business and leisure travellers in India. Through this, it is believed to address the entire travel market in India.
- The company uses a hybrid platform consisting of websites, mobile apps, travel agents, and call centres for its distribution channels. Its streamlined software also allows for marketing additional travel products and services to existing customers.
- The company uses an integrated platform approach that provides it with a scalable, comprehensive and consistent user experience across each of its three go-to-market channels. It also leverages and contributes to open-source technologies, leading to faster innovation, development and cost efficiencies.
- The company has a comprehensive selection of travel-related services, thereby providing it with multiple points of contact with travellers allowing it to develop an ongoing repeat relationship with its customers.
Weaknesses of the Company
- Promoters of the company will continue to hold a significant portion of the stake in the company after the IPO. This will allow them to exercise significant influence over the company which might not be favourable.
- The company’s ticketing business generates a substantial portion of its revenue. If any of the airlines apply significant price and margin pressure on the company, it could have adverse effects on its business.
- Failure to successfully manage the search engine optimization and search engine monetization strategies could result in a substantial decrease in traffic to the company websites.
- The company relies on third-party systems and service providers, and any disruption or adverse change in the providers’ business could have a significant effect on its business.
- The company is exposed to risks associated with the payments including online security and credit card fraud
Yatra Online IPO Review – GMP
We will update the article once the GMP is available.
Yatra Online IPO Review – Key IPO Information
| Particulars | Details |
|---|---|
| IPO Size | |
| Fresh Issue | ₹602.00 Cr |
| Offer for Sale (OFS) | 12,183,099 shares of ₹1 |
| Opening date | September 15, 2023 |
| Closing date | September 20, 2023 |
| Face Value | ₹1 per share |
| Price Band | ₹135 to ₹142 per share |
| Lot Size | 105 Shares |
| Minimum Lot Size | 1(105 shares) |
| Maximum Lot Size | 13(1365 shares) |
| Listing Date | September 29, 2023 |
Promoters: THCL Travel Holding Cyprus Limited and Asia Consolidated DMC Pte. Ltd
Book Running Lead Manager: SBI Capital Markets Limited, DAM Capital Advisors Limited and IIFL Securities Limited
Registrar to the Offer: Link Intime India Private Limited
The Objective of the Issue
The net proceeds from this issue will be utilized for the following purposes:
- Strategic acquisitions, investments and inorganic growth
- Investment in customer retention and acquisition, technology, and other organic growth initiatives
- General corporate purposes.
In Closing
In this article, we looked at the details of Yatra Online IPO Review 2023. We can conclude that, though the company faced a significant impact during the pandemic, it has recovered well in the following years. If the company manages to keep up with growth in the tourism industry, it can give favourable growth in the future.
What do think the future holds for the company? Are you applying for the IPO? Let us know in the comments below.
Written By Aaron Vas
By utilizing the stock screener, stock heatmap, portfolio backtesting, and stock compare tool on the Trade Brains portal, investors gain access to comprehensive tools that enable them to identify the best stocks also get updated with stock market news, and make well-informed investment decisions.
Start Your Stock Market Journey Today!
Want to learn Stock Market trading and Investing? Make sure to check out exclusive Stock Market courses by FinGrad, the learning initiative by Trade Brains. You can enroll in FREE courses and webinars available on FinGrad today and get ahead in your trading career. Join now!!
