ixigo submitted its preliminary paperwork to SEBI (the market regulator) on August 12, 2021, in order to raise Rs. 1,600 crore through a public offering. The offering would consist of Rs. 850 crore as an OFS (offer for sale) and Rs. 750 crore as a new issue of equity shares, according to the DRHP.
The technology startup ixigo was established in 2007 with the goal of helping Indian tourists organize, book, and organize their travels across hotels, buses, airplanes, and trains. Through advances based on data science, machine learning, and artificial intelligence on its OTA platforms (apps and websites), it aids travelers in making wiser decisions. It has become India’s top travel ecosystem thanks to its emphasis on cost-effectiveness, customer experience, and travel utility. The travel utility services and tools were created
using data collected from the general public and unique algorithms. Gurgaon, Haryana, serves as the company’s headquarters. In order to grow, Ixigo now intends to launch an initial public offering. Micromax Informatics would sell shares worth Rs 200 crore in this public offering, and Saif Partners India IV has planned to sell shares for Rs 550 crore. In addition, Rajnish Kumar and Aloke Bajpai would each sell shares valued at Rs. 50 crore.
Ixigo IPO Objectives
Ixigo will use the proceeds from its initial share sale for the following purposes:
- for inorganic and organic growth initiatives.
- for corporate purposes.
Why should you invest in the Ixigo IPO?
Investing in the initial public offering of ixigo can be a rewarding choice due to the following aspects:
- Ixigo is the biggest online travel agency (OTA) for trains. Train-based apps, such as ConfirmTkt, accounted for a market share of 42% with respect to rail bookings in FY 21 for IRCTC.
- Its bus-related app, namely AbhiBus, emerged as the second-greatest bus ticketing OTA during FY 21, with 10% of the market share.
- The total number of app users on ixigo stood at 37.48 million on the basis of MAU (monthly active users) in March 2021. This marks the highest app usage among the OTA platforms.
- Since its inception, Ixigo has raised $82 million through secondary share sales and $58 million from investors in the primary market. This makes it one of the least funded customer tech startups to touch the financial market.
Ixigo IPO Financials
| Financial Year | Total Assets in Rs. crores | Revenue from Operations in Rs. crores | Profit After Tax in Rs. crores |
|---|---|---|---|
| FY 2021 | 181.33 | 135.56 | 7.53 |
| FY 2020 | 70.13 | 111.60 | 26.61 |
| FY 2019 | 60.40 | 40.36 | 57.35 |
Know before investing
Strengths
- In July 2021, ixigo was recognized as the best online travel agency on the Google Play Store based on engagement and usage.
- The top management of this company is highly experienced and skilled, with industry-specific knowledge.
- The technology-related expenses of ixigo lead to lower operational costs. As a result, the operating margin is higher, and it will reduce with the economies of scale.
Risks
- Some travel suppliers can eliminate or reduce the incentive or commission payable to the company for ticket sales. This can significantly impact the operations and cash flows of Ixigo.
- At present, the competitors of this firm have extensive market shares.
- There can be a lack of proper coordination with travel entities.
Ixigo IPO Peer Comparison
| Name of the Company | Revenue in Rs. crores | Gross Transaction Value in Rs. crores | Monthly Downloads (expressed in lakhs) | Employee Strength |
|---|---|---|---|---|
| EaseMyTrip | 106 | 2,120 | 2 | 420 |
| Yatra | 120 | 1,470 | 1 | 2,000 |
| MakeMyTrip | 1170 | 11,700 | 8 | 3,200 |
Ixigo IPO FAQs:
Q1. What is the ticketing revenue of ixigo in FY 21?
Ans. The ticketing revenue of ixigo is Rs. 126 crores in FY 21, marking a 107% YoY jump.
Q2. What is the advertisement revenue for ixigo in FY 21?
Ans. The advertisement revenue for ixigo declined from Rs. 11 crores in FY 20 to Rs. 7 crores in FY 21. The COVID-19 outbreak has significantly affected this figure.
Q3. What about the app rating and app reviews of ixigo in FY 21?
Ans. For ixigo, the app rating is 4.6, and the number of app reviews is 18 lakh in FY 21.
Q4. Did the net sales of ixigo grow in FY 2020-21?
Ans. While the pandemic has greatly affected the hospitality and travel sector, the net sales of ixigo grew 21% for FY 2020-21.
Q5. How much did ixigo borrow in FY 21?
Ans. ixigo has total borrowings of Rs. 15 crores in FY 21, indicating a substantial reduction from Rs. 233 crores in FY 20.
