In a highly price-sensitive market like India, where a slight difference in airfare and hotel charges leads to users switching to other online platforms, Yatra.com has maintained its leadership position in the online travel market despite the entry of heavily funded new players. Its parent, Yatra Online, recently got approval from SEBI to raise ₹602 crores through IPO and have its stock publicly traded in India after being listed on Nasdaq in 2016.
This article will share details of the Yatra Online IPO.
Yatra Online IPO Date, Lot Size & More
Yatra Online filed a draft red herring prospectus (DRHP) with SEBI on March 25th, 2022, for a fresh issue of ₹602 crores and an offer for sale (OFS) from existing investors. SEBI approved it on November 19, 2022.
The OFS will be 12,183,099, off which the promoter- THCL Travel Holding Cyprus Limited, will sell 11,751,739 equity shares, and Pandara Trust will sell the remaining 431,360 equity shares.
The company has raised 62.01 crores from its Rights issue and allotted 26,27,697 shares to THCL at an issue price of Rs. 236 as a part of the pre-IPO placement. So the fresh issue of Rs. 750 crores has been reduced by Rs. 148 crores, including the pre-IPO placement of 62.01 crores, which is why the fresh issue will now be ₹602 crores
| IPO Status | Approved |
| IPO Date | 15th-20th September |
| Face Value | INR 1 per share |
| Issue Price Band | INR 135 – 142 per share |
| Lot Size | 105 Shares |
| Fresh issue | [.] shares (aggregating up to ₹602.00 Cr) |
| OFS | 1,21,83,099 shares of ₹1 (aggregating up to ₹[.] Cr |
| Issue Type | Book built |
| IPO listing at | NSE & BSE |
| Face Value | ₹1 per share |
| Reservations | Share |
| QIB | 75% |
| Retail | 10% |
| HNI | 15% |
Yatra Online IPO SWOT Analysis
Yatra Online has established itself as a trusted name in the Indian travel industry, a space in a few large players, like MakeMyTrip, IRCTC, and EaseMyTrip, who dominate many other small online and offline players.
Strengths
- Large and loyal user base: 90% of the total traffic source comes from direct and organic traffic, with a 98.7% booking success rate. Over 12 million cumulative travel customers as of September 30, 2021.
- Strong presence in the B2B segment: Tie-up with 700 large corporates and over 46,000 registered SME customers. The B2B segment in Indian OTA is expected to grow at a Compounded Annual Growth Rate of 12% to 14%
- A comprehensive selection of products and services: Provide booking facility in over 93,500 properties – hotels and homestays on the platform across 1400 cities in India.
- Integrated technology platform: Developed a single standard user view across B2C and B2B channels, enabling smooth inventory integration. Have a dedicated in-house advanced technology infrastructure and data analytics capability.
- Multi-Channel GTM: Yatra has a multi-channel go-to-market approach for Business and Leisure Travelers
Weaknesses
- High dependency on air ticketing revenue: The company depends on ticketing revenue. A drop in air ticketing revenue could impact the company’s financial position.
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Risks
- Highly competitive industry: The Indian online travel industry is a highly competitive industry, with almost all players working on razor-thin margins
- Macro and geopolitical risks: The performance of the travel and tourism industry largely depends on the state of the economy.
- Health emergencies: A pandemic-like situation severely impacts the travel and tourism industry and is the last sector to witness a rebound.
Opportunities
- Improving outlook for air travel in India: With record-breaking aircraft orders from Indian airlines and the government’s push to increase the number of airports from 140 to 220 by 2025, online OTA platforms have enormous growth potential.
- THE B2B segment is expected to drive growth: The B2B category’s share of the overall OTA industry is expected to increase from ₹33 billion in FY20 to ₹62-66 billion in FY25.
- Strengthening its presence in the holiday packages segment: Being a higher-margin segment, Yatra may benefit if it can strengthen its presence in the holiday packages segment, currently dominated by large TTAs.
What will Yatra Online do with IPO Money?
The proceeds of the IPO will be used for the following items:
- ₹150 crores will be utilized for strategic investments, acquisitions, and inorganic growth
- ₹392 crores will be utilized for investment in customer acquisition and retention, technology, and other organic growth initiatives
- The remaining sum will be utilized for general corporate purposes
Yatra Online: Overview of the Company
Yatra Online is India’s most prominent travel service provider and second-largest online travel company in gross bookings and operating revenue. The company was founded on 1st August 2006 by Dhruv Shringi (CEO), Manish Amin (CTO), and Sabina Chopra (COO).
Currently, Yatra Online provides comprehensive travel-related services, including flights, hotels, train and bus bookings, holiday packages, and other activities, on its website, www.yatra.com, and mobile application.
Yatra Online focuses both on B2B and B2C segments. It provides travel-related services to over 700 large corporate customers that employ over 7 million people. In addition, Yatra is also an integrated technology provider that helps aggregate customer demand from over 28,000 travel agents in more than 840 cities.
In the hotel booking space, Yatra provides access to room bookings in over 93,500 hotels, homestays, and other accommodations in about 1400 cities and towns in India. Yatra Online has raised a total funding of $2.1 billion in over 11 rounds from 12 investors, according to data from Crunchbase.
Yatra Online Financials
According to DRHP filed with SEBI, Yatra Online reported total revenue from operations at ₹380.16 crores in FY23, increased from ₹198.06 crores in FY22.
Segment-wise Revenue Breakup
Yatra Online has four reportable segments – Air Ticketing, Hotel & Packages, and Others. Let’s check out the segment-wise revenue breakup for FY23, FY22, and FY21.
| Segment | FY21 | FY22 | FY23 |
| Air Ticketing (in cr.) | ₹89.31 | ₹115.05 | ₹177.99 |
| Hotel & Packages (in cr.) | ₹15.66 | ₹51.21 | ₹144.56 |
| Others (in cr.) | ₹3.14 | ₹14.62 | ₹15.43 |
Yatra Online Share Price Performance in Nasdaq
Yatra Online was listed on Nasdaq in December 2016, through a reverse merger with Terrapin 3 Acquisition Corporation valuing the enterprise at $218 million. Yatra raised more than $92.5 million as a part of the process.
Since its listing on Nasdaq, Yatra Online share price has not given positive returns to investors over the long term, falling from a high of $12.85, which it made in July 2017, and is currently trading at $2.39.
Conclusion
Despite its presence in the high-growth travel and tourism industry, the cost pressure will likely persist with new players entering the market. However, you must thoroughly study the company and read the DRHP before you decide.
*Disclaimer Note: The securities quoted, if any, are for illustration only and are not recommendatory. This article is for education purposes only and shall not be considered as recommendation or investment advice by Research & Ranking. We will not be liable for any losses that may occur. Investment in securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL, and certification from NISM in no way guarantee the performance of the intermediary or provide any assurance of returns to investors.
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IPO | Current IPO | Upcoming IPO | Listed IPO
FAQs
How much is Yatra Online raising through IPO?
Yatra Online plans to raise ₹602 crores through a fresh issue and an OFS for 1,21,83,099 shares of ₹1 from promoters and existing investors.
When will the Yatra Online IPO be launched?
The company will launch the IPO on 15 September 2023.
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