Nasdaq-listed Yatra’s IPO opens on Sept 15

By Forum Gandhi

Price band fixed at ₹135-142. Yatra, a Nasdaq-listed company, intends to launch its initial public offering (IPO) in India.

According to the company’s CEO, Dhruv Shringi, the funds raised through the IPO will be allocated for both organic growth in the B2B segment and inorganic growth in the B2C segment. Regarding the business outlook, he mentioned that the current 40:60 ratio of the B2C and B2B segments will shift to a 50:50 ratio in the next fiscal year.

The company aims to attract a 25 per cent share from High-Net-Worth Individuals (HNIs) and retail investors with 75 per cent institutional investors, he added. The IPO includes a fresh issuance of Equity Shares valued at ₹602 crore and an Offer for Sale (OFS) of up to 1.22 crore shares with a price band of ₹135-142.

It is scheduled to open for subscription on September 15, and close on September 20. Investors can bid for a minimum of 105 equity shares.

Yatra was listed on Nasdaq in 2016. When asked the rationale behind a dual listing, Shringi said, “India is our home market, investors are familiar with us. The US was never a natural fit for us, the listing there was to meet the needs of our investors in the states. Now, most of them have exited and hence, India becomes a natural fit for us.”

The proceeds from the fresh issue will be allocated towards strategic investments, acquisitions, and inorganic growth (₹150 crore), investment in customer acquisition and retention, technology, and other organic growth initiatives (₹392 crore), and general corporate purposes.

“We aim to acquire offline companies lacking tech investment but with strong customer relationships, expanding their capacity. In the B2C sector, we’ll seek complementary technology for cross-selling services like expense management and budgeting to boost operating margins. We also see substantial growth potential in tier-2 and 3 markets for both B2B and B2C online industries,” he added.

In terms of competition, Yatra Online Limited faces competition from various online travel agencies (OTAs), traditional offline travel companies, travel research firms, payment wallets, search engines, and meta search companies, both within India and abroad. Notable competitors include MakeMyTrip, Cleartrip, EaseMyTrip, Thomas Cook, and ixigo. IRCTC, EaseMyTrip, ITDC and Thomas Cook are listed in India and ixigo too plans to be listed soon.

However, Shringi said, “If you look at the US and China, there are several players. With India’s scale size, there are only a handful of players. We think this is an apt time to enter the market. Given the presence of the existing players in this segment, and their growth, along with our attributes, our business and the ecosystem, we have a strong position.” Travel consultancy firm Videc states that Yatra has a 6.6 per cent market share in the Indian OTA segment. Within the air travel segment it has a close to 10 per cent segment, in the hotels segment it has a market share of 3.6 per cent, and 1 per cent, respectively, in the bus and train segment.

Shringi believes that the growth for will come from the B2B segment.

Read original story on The Hindu Businessline.