Description
The PPT gives the detailed profile of the company makemytrip.
Make MyTrip.com
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
2
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
3
Company Snapshot
Facts
Founded Headquarters Ownership Type 2000 (Indian Operations in 2005) Gurgaon, Haryana, India Public (Listed at NASDAQ: MMYT)
MakeMyTrip reported better than expected F4Q12 results on both the top and bottom line
Brief Company Description
• MakeMyTrip is an Indian online travel agency • The travel services and products offered by MakeMYTrip.com are international and domestic airline tickets, Indian Railways tickets, domestic bus tickets, international and domestic hotel reservations, car rentals, international and domestic holiday packages, MICE (Meetings, Incentives, Conferencing, Exhibitions), visa services, B2B services, and more. http://www.makemytrip.com $ 196.599 m (FY 2012) ~ 1,300 50+ cities across India and 2 international offices in New York and San Francisco (in addition to several franchise locations)
Company Website Revenue Employee Strength Geographic Locations
MMT has launched dedicated websites for USA and UAE
Source: Company Website; Wikipedia; Reuters; Yahoo Finance; Company reports, Deutsche Bank
4
MMT at a Glance
Key Developments MakeMyTrip is using Ixigo.com to build technology platforms to launch new services to take advantage of the 4G spectrum rollout in India over the next two years. The firm launched mobile apps for Android devices and iPhones and an upgraded mobile website for smartphones With reducing commissions on air ticketing, the non-air segment offers higher margins and longterm growth for OTAs
Key Challenges
The biggest challenge is contracting domestic standalone hotel inventory, which is highly fragmented
With the existing competition in online travel space, we can surely see consolidation in the coming years.
Along with that, airline companies like SpiceJet, IndiGo and KingFisher in India are coming up with their own portal Rang7, which will affect OTA’s
Source: Secondary Research
5
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
6
Organizational Structure
Deep Kalra Founder and CEO
Keyur Joshi Co-Founder and Chief Commercial Officer Rajesh Magow Co-Founder and CFO and COO
Sanket Atal Chief Technolog y Officer
Mohit Gupta Chief Business Officer Holidays
Rajnish Kapur Chief Innovation and Customer Experienc e Officer
Amit Somani Chief Products Officer
Amit Saberwal Chief Business Officer – Internation al Markets
Anand Kandadai Senior VP – Outbound Tours
Purva Misra Senior VP - HR
Mohit Kabra Senior VP – Finance, Admin & Legal
Note: For detailed profile click here
Source: Company Website
7
Key IT Executives
Executive Name Designation Location
Mukesh Singh Senior Vice President - Technology Development Gurgaon, India
Gurpreet S.
Deputy Manager - IT
Gurgaon, India
Kunwar Asheesh Saxena
Director - Technology Development
Gurgaon, India
Source: LinkedIn
8
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
9
Business Segments (1/3)
?
Its all about travel…….
International and Domestic Air Tickets, Holiday Packages and Hotels
B2B and Affiliate Services
Domestic Bus and Rail Tickets
Business Segment
MICE (Meetings, Incentives, Conferences & Exhibitions)
Private Car and Taxi Rentals
Source: Company Website
10
?
Business Modeling (2/3)
Founded in the year 2000
Nurtured from the seed of a single great idea - to empower the traveller MakeMyTrip went on to pioneer the entire online travel industry in India
MakeMyTrip also stayed ahead of the curve by continually evolving its technology to meet the ever changing demands of the rapidly developing global travel market
Created to empower the Indian traveller with instant booking and comprehensive choices
Aimed to offer a range of best-value products and services along with cutting-edge technology and dedicated round-the-clock customer support
MakeMyTrip followed its success in the US by launching its India operations in 2005 MakeMyTrip is the undisputed online leader, with its share of the travel market extending to more than 50% of all online sales
With the foresight to seize the opportunities in the domestic travel market, MakeMyTrip offered travellers the convenience of online travel bookings at rock-bottom prices
With untiring innovation and determination, MakeMyTrip proactively began to diversify its product offering, adding a variety of online and offline products and services Today, MakeMyTrip is much more than just a travel portal or a famous pioneering brand - it is a one-stop-travel-shop that offers the broadest selection of travel products and services in India
Source: Company Website
11
?
Business Imperatives (3/3)
77%
Air Ticket Booking (Domestic, Outbound and Inbound)
MakeMyTrip is the largest online travel portal in India based on gross bookings
20%
Hotel bookings and packaged tours
03%
Rail and car bookings
~2,000
Travel Agent Network
250+
Presence in India (cities)
~1.7m
Average visitors/month
Source: Company Website
~50%
Market Share in India
~4,000
Hotels Network
12
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
13
Geographical Coverage
?
PAN India coverage with more than 50 offices at different locations
MMT Office Locations
Head Office
Gurgaon
Branch Offices
Ahmedabad Chandigarh Gangtok Jabalpur Mumbai Puducherry Amritsar Chennai Goa Jamnagar Madurai Pune Agra Cochin Guwahati Kolkatta Nagpur Rajkot Anand Coimbatore Gurgaon Kanpur Nasik Secunderabad Bangalore Delhi Hyderabad Lucknow Navi Mumbai Surat Bhopal Faridabad Indore Ludhiana Noida Tirupati
Trivendrum
Vadodra
Vishakhapatnam
Vijaywada
Vapi
Source: Company Website
14
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
15
Key Industry Pointers
• • India was ranked the eleventh-most-attractive tourist destination in the Asia-Pacific region by the World Economic Forum in 2010 Contribution • In the year 2011, Indian travel industry is worth $22b of which the Online Travel Agency (OTA) space is approximately 32% which is $7b. • Travel and Tourism is the largest sector in India, contributing 6.23% to the national GDP, and representing 8.78% of the total country's employment Increasing numbers of travellers • The volume of tourists in the country grew from 466.8 million in 2006 to 710.6 million in 2010 • The above growth was at a compound annual growth rate (CAGR) of 11.03% during the review period (2007–2011). Just 6% market share separates rivals MakeMyTrip and Yatra in the leading travel websites in India The trend of booking trips online is expected to grow further in 2012, especially in emerging markets such as China, India and Brazil Gross bookings on the Asia Pacific online leisure/ unmanaged business travel market are expected to increase by slightly more than +30% in 2012 compared to 2010
Source: Secondary Research
16
•
• •
Most Popular Travel Websites in India - 2011
Others 32%
Make My Trip 29%
•
Cleartrip 16%
Yatra 23%
Key Industry Challenges
Technology Acceptance
Volatility in Aviation Industry
This volatility not only impacts the inventory and pricing of tickets and hotel rooms, but also hurt consumer sentiments while making a purchase The internet availability, broadband penetration and the prevalence of online banking and credit/debit card is 16.0% very low in the country 12.0% 8.0% 4.0% 0.0% FY08 FY09 FY10 FY11 FY12 FY13
Low margins & high operating costs
On Air Bookings the company gets 3% commission on gross fare with Rs 50 to Rs 100 as service fee from the customer
Net revenue margins in Hotel business
The trend which was on a high since 2008 to 2010 is now expected to take a UTurn
Personal Acceptance
The habit of buying an air ticket is mostly through a travel agent and booking a hotel room is done for majority of times through calling the hotel directly or by turning up in person
Net Revenue Margins
14.0% 13.8% 13.5% 13.0% 10.6% 8.9%
We can probably offer solutions leveraging our reach in remote location and help spread awareness for technology based offerings from MMT
Source: Secondary Research
17
Key Growth Facts
•
Market share for OTA's in India 2010-2011
Others 10% Cleartrip 18%
•
•
Make My Trip 48%
•
Yatra 24%
• •
Indian travel industry grew by 13% to reach $23b in 2011, as compared to 2010. The online business is expected to grow faster, at 28% to reach $7b in 2011 from $4b in 2010 The key drivers for this growth are considered to be: • Growth of internet • Growth in low-cost carriers • Secure payment mechanisms The Online Travel Industry operates in segments like • Ticket booking - Air & Non Air • Tele Reservation • Car Rentals • Tour Packages In the above, Air travel dominates the current online travel industry in India with 60%+ market share The share of online travel bookings currently stands at 30 per cent and is expected to rise exponentially as the internet penetration increases in the country
Source: Secondary Research
18
Key Industry Trends
?
The world's largest travel portal Expedia foresees 2012 as the year when India will become the fastest-growing travel market in Asia-Pacific
The Travel Boom Emergence of Low Cost Airlines
• The volume of tourists in the country grew from 466.8m in 2006 to 710.6m in 2010, at 11.03% CAGR • OTAs are now looking for more offline counters leveraging on their brand value • The so called ‘No Frills Airlines’ has provided an opportunity for even average middle class to avail these services • The 2-3 star properties has made it cheaper for people to travel and stay, helping the OTA space grow at 30% • Online travel is the driving force in the e-commerce segment, with a global contribution of 70% of all e-commerce activities • Competition in online ticket booking is moving away from air to non-air segments • Online travel going mobile: changing e-travel to m-travel with Mobile penetration increasing considerable in the past few years and people are accessing the internet through their phones • Meta search engine is the latest innovation in online travel
Proliferation of Internet
Positive Economic Outlook
• India's strong economic forecast and positive business confidence will fuel growth in the travel intermediaries industry • Market growth would drive more mergers and acquisitions, and possible initial public offerings (IPO). • The Indian travel intermediaries industry is projected to grow from INR679.9b in 2012 to INR1,218.3b in 2016, at a CAGR of 15.7%
Source: Secondary Research
19
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
20
Financial Metrics (1/2)
Revenue vs. Profit– (2008-2012)
200
In $ million 150 100
68.55 83.56
61.07
40.28
Profit After Tax – (2008-2012)
196.59
Gross Revenue ($m) Gross Profit ($m)
124.72
25 15 In $ million
Profit After Tax ($m)
4.8 7.0
88.18
5 -5 2008 2009
-7.3 -18.9
2010
-6.2
2011
2012
50 0
38.33
16.5
24.99
-15 -25 2011 2012
2008
2009
2010
• • •
Air bookings take rates benefit from opaque fares in the period • Air bookings of $213mn were well above the estimated $184mn for 2012 • Net air revenue of $17.8mn, handily beat the $16.4mn estimate for the year Hotels and packages (H&P) segment outperforms on bookings • H&P gross bookings of $33.2mn came in well above the $26.9mn estimate in 2012 • Hotel net revenue of $3.2mn was in line with the estimate, despite higher gross bookings The company was able to take up there PAT from negative in 2008 to positive in 2011, which again saw improvement in 2012.
Source: Company reports - Deutsche Bank
21
Financial Metrics (2/2)
Operating Expenses – (2008-2012)
200
In $ million 150 100 50 0 2008 2009 2010 2011 2012
32.8 35.6 46.3 57.0 84.1
Operating Profit – (2008-2012)
20 15 10 5 0 -5 -10 -15 -20 Operating Profit ($m)
4.1 4.0
Operating Expenses ($m)
In $ million
2008
2009
-10.6
2010
-6.0
2011
2012
-16.3
•
•
Operating Expenses were a big shoot-up this year • The companies OpEx were on a high yet again since 2008 • This increased expenditure were due to the fact that the company invested in offering more reach to their customers in terms of local presence and are trying to expand to different geographies Operating Profit still struggling to grow • MMT was able to bring their negative operating profit to positive in the year 2011 which again dipped very marginally by $0.1m in 2012.
Source: Company reports - Deutsche Bank
22
Business Strategies (1/2)
1
Adding value to customers and stakeholders
Accelerate the mix shift from the lower margin air segment to the higher margin
3
2 4
Building a strong competitive position in fast growing market
Reducing the exposure to air ticket portfolio
Source: Company reports - Deutsche Bank; Secondary Research
23
Business Strategies (2/2)
Accelerate the mix shift from the lower margin Air segment to the higher margin – MMT believe that the company may be able to accelerate the mix towards higher margin Hotel and Packages business by adhering to certain aspects. They are:- (1) increased supply, (2) innovations on the payment side drawing more Indians to book online and, (3) conversion improvement from the Hotels internal feedback. MMT expect to benefit from the longer-term growth in the Indian travel market and the shift from offline to online bookings over time. The model continues to develop well on H&P revenues, where the company continues to add to supply and innovate on the user experience, which should lead to ongoing bookings and revenue growth in this higher margin segment Building a strong competitive position in fast growing market – As the company builds the hotel segment, it should ultimately lead to higher earnings power in the business in coming years. This would also help them build strong competitive position in a relatively fast growing emerging market by attracting different acquisition candidate for international OTAs seeking exposure to emerging markets. This would also help them maintain their buy rating on shares of MakeMyTrip, despite the challenging near-term environment.
1
2
3
Adding value to customers and stakeholders – Every OTA player today is focusing on providing more value for the customer’s time and money. The focus this year for MakeMyTrip is to move beyond customer satisfaction and towards creating customer delight. Being ahead on the technology curve is what gives them an edge as it is very important to keep on upgrading and reinventing new processes to enhance customer experience. Same is true for the suppliers as well, as the company always strive to provide them with the best environment to showcase their products
Reducing the exposure to air ticket portfolio – MMT is continuously focusing on non-air products to increase their share of revenue. They are trying to reduce their exposure to the air ticketing portfolio and increasing other verticals such as hotels and holidays. The mix which is currently 75:25 was 80:20 in 2011 and is expected to become 50:50 by 2016
4
Source: Company reports - Deutsche Bank; Secondary Research
24
Mergers & Acquisitions
Ticketvala.com – Feb 2010 MMT has acquired strategic assets from Ticketvala including website, URL, technology platform agent network, and bus inventory. Ixigo.com – July 2011 MakeMyTrip bought a stake in Ixigo.com, an online travel search engine, for $4.8 million
Luxury Tours and Travel Pte Ltd – March 2011 MakeMyTrip acquired a majority stake in this Singapore-based agency that provides hotel reservations and tours, for $3.4 million
My Guest House Accommodations Pvt. Ltd – Nov 2011 MMT bought a 29% stake in Delhi-based company for $1 million.
Source: Secondary Research
25
SWOT Analysis
• One of the earliest market entrants and holds a significant brand name • Carry experience from the international business scenarios • Secure and trusted channel for facilitating payments • Offers complete set of services related to the industry • Creating tailored holiday packages for the customers • Penetrate the offline market with more physical presence and create awareness for larger online transactions • Create m-commerce applications to attract more customers
Source: Secondary Research
26
• General Reluctance in customers to use internet for financial transactions like booking tickets online • Major business from Airlines tickets. Need to create a better mix of the revenue share
• Present competitors having substantial market share • Newly emerging online booking portals with similar offerings • Shift is contracting domestic standalone hotel inventory
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
27
News and Events (1/2) MakeMyTrip.com had the distinction of being
the most visited travel website
• According to comScore, the world's leading digital marketing intelligence and measurement service, MakeMyTrip.com was the most visited travel website in the period 2005-2009 and is still the leading in term of unique visitors. • It was also scored as the Number One travel website by JuxtConsult, a fully integrated market research company in India • MMT was also the Most Preferred Online Travel Agency by the Travel Biz Monitor Survey • MakeMyTrip.com has also emerged as the top seller among online and offline travel companies for all the major domestic and international airlines, as well as hotels
MMT - staying on top of technological developments
• MakeMyTrip.com provided customers with the facility of searching, booking and paying for their air tickets using their mobile phone. • This facility was also provided to non GPRS-enabled handsets • This eliminated the need for a computer or an internet connection and gave travellers the advantage of making their purchases from anywhere in the country, at any time.
Source: Superbrand India News; Economic Times
28
News and Events (2/2) MakeMyTrip appoints Sanket Atal as chief
technology officer
• In June this year, MMT announced the appointment of Sanket Atal as the new chief technology officer at to head the technology development and support teams in the travel company • This would strengthen their focus on technology and Innovation to drive the next phase of our evolution • CEO mentioned that with technology as the natural enabler in their business to fuel innovation and achieve excellence in customer experience, it is very necessary to keep updating with the trends in technology
MakeMyTrip has launched mobile apps for Android devices and the iPhone
• Following the launch of the Blackberry app, these apps would marks a comprehensive mobile suite from MakeMyTrip that offers its services across all mobile devices, and is designed to make travel planning fast. • With these apps available to download, MMT becomes one of the top five most-downloaded travel apps in India • The app also provides alerts on updated flight schedules and allows users to share their itineraries on Facebook and Twitter • It also uses the device’s GPS capabilities to find the closest restaurants.
Source: Economic Times; The Hindu
29
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
30
Thank You
31
doc_728176811.pptx
The PPT gives the detailed profile of the company makemytrip.
Make MyTrip.com
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
2
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
3
Company Snapshot
Facts
Founded Headquarters Ownership Type 2000 (Indian Operations in 2005) Gurgaon, Haryana, India Public (Listed at NASDAQ: MMYT)
MakeMyTrip reported better than expected F4Q12 results on both the top and bottom line
Brief Company Description
• MakeMyTrip is an Indian online travel agency • The travel services and products offered by MakeMYTrip.com are international and domestic airline tickets, Indian Railways tickets, domestic bus tickets, international and domestic hotel reservations, car rentals, international and domestic holiday packages, MICE (Meetings, Incentives, Conferencing, Exhibitions), visa services, B2B services, and more. http://www.makemytrip.com $ 196.599 m (FY 2012) ~ 1,300 50+ cities across India and 2 international offices in New York and San Francisco (in addition to several franchise locations)
Company Website Revenue Employee Strength Geographic Locations
MMT has launched dedicated websites for USA and UAE
Source: Company Website; Wikipedia; Reuters; Yahoo Finance; Company reports, Deutsche Bank
4
MMT at a Glance
Key Developments MakeMyTrip is using Ixigo.com to build technology platforms to launch new services to take advantage of the 4G spectrum rollout in India over the next two years. The firm launched mobile apps for Android devices and iPhones and an upgraded mobile website for smartphones With reducing commissions on air ticketing, the non-air segment offers higher margins and longterm growth for OTAs
Key Challenges
The biggest challenge is contracting domestic standalone hotel inventory, which is highly fragmented
With the existing competition in online travel space, we can surely see consolidation in the coming years.
Along with that, airline companies like SpiceJet, IndiGo and KingFisher in India are coming up with their own portal Rang7, which will affect OTA’s
Source: Secondary Research
5
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
6
Organizational Structure
Deep Kalra Founder and CEO
Keyur Joshi Co-Founder and Chief Commercial Officer Rajesh Magow Co-Founder and CFO and COO
Sanket Atal Chief Technolog y Officer
Mohit Gupta Chief Business Officer Holidays
Rajnish Kapur Chief Innovation and Customer Experienc e Officer
Amit Somani Chief Products Officer
Amit Saberwal Chief Business Officer – Internation al Markets
Anand Kandadai Senior VP – Outbound Tours
Purva Misra Senior VP - HR
Mohit Kabra Senior VP – Finance, Admin & Legal
Note: For detailed profile click here
Source: Company Website
7
Key IT Executives
Executive Name Designation Location
Mukesh Singh Senior Vice President - Technology Development Gurgaon, India
Gurpreet S.
Deputy Manager - IT
Gurgaon, India
Kunwar Asheesh Saxena
Director - Technology Development
Gurgaon, India
Source: LinkedIn
8
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
9
Business Segments (1/3)
?
Its all about travel…….
International and Domestic Air Tickets, Holiday Packages and Hotels
B2B and Affiliate Services
Domestic Bus and Rail Tickets
Business Segment
MICE (Meetings, Incentives, Conferences & Exhibitions)
Private Car and Taxi Rentals
Source: Company Website
10
?
Business Modeling (2/3)
Founded in the year 2000
Nurtured from the seed of a single great idea - to empower the traveller MakeMyTrip went on to pioneer the entire online travel industry in India
MakeMyTrip also stayed ahead of the curve by continually evolving its technology to meet the ever changing demands of the rapidly developing global travel market
Created to empower the Indian traveller with instant booking and comprehensive choices
Aimed to offer a range of best-value products and services along with cutting-edge technology and dedicated round-the-clock customer support
MakeMyTrip followed its success in the US by launching its India operations in 2005 MakeMyTrip is the undisputed online leader, with its share of the travel market extending to more than 50% of all online sales
With the foresight to seize the opportunities in the domestic travel market, MakeMyTrip offered travellers the convenience of online travel bookings at rock-bottom prices
With untiring innovation and determination, MakeMyTrip proactively began to diversify its product offering, adding a variety of online and offline products and services Today, MakeMyTrip is much more than just a travel portal or a famous pioneering brand - it is a one-stop-travel-shop that offers the broadest selection of travel products and services in India
Source: Company Website
11
?
Business Imperatives (3/3)
77%
Air Ticket Booking (Domestic, Outbound and Inbound)
MakeMyTrip is the largest online travel portal in India based on gross bookings
20%
Hotel bookings and packaged tours
03%
Rail and car bookings
~2,000
Travel Agent Network
250+
Presence in India (cities)
~1.7m
Average visitors/month
Source: Company Website
~50%
Market Share in India
~4,000
Hotels Network
12
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
13
Geographical Coverage
?
PAN India coverage with more than 50 offices at different locations
MMT Office Locations
Head Office
Gurgaon
Branch Offices
Ahmedabad Chandigarh Gangtok Jabalpur Mumbai Puducherry Amritsar Chennai Goa Jamnagar Madurai Pune Agra Cochin Guwahati Kolkatta Nagpur Rajkot Anand Coimbatore Gurgaon Kanpur Nasik Secunderabad Bangalore Delhi Hyderabad Lucknow Navi Mumbai Surat Bhopal Faridabad Indore Ludhiana Noida Tirupati
Trivendrum
Vadodra
Vishakhapatnam
Vijaywada
Vapi
Source: Company Website
14
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
15
Key Industry Pointers
• • India was ranked the eleventh-most-attractive tourist destination in the Asia-Pacific region by the World Economic Forum in 2010 Contribution • In the year 2011, Indian travel industry is worth $22b of which the Online Travel Agency (OTA) space is approximately 32% which is $7b. • Travel and Tourism is the largest sector in India, contributing 6.23% to the national GDP, and representing 8.78% of the total country's employment Increasing numbers of travellers • The volume of tourists in the country grew from 466.8 million in 2006 to 710.6 million in 2010 • The above growth was at a compound annual growth rate (CAGR) of 11.03% during the review period (2007–2011). Just 6% market share separates rivals MakeMyTrip and Yatra in the leading travel websites in India The trend of booking trips online is expected to grow further in 2012, especially in emerging markets such as China, India and Brazil Gross bookings on the Asia Pacific online leisure/ unmanaged business travel market are expected to increase by slightly more than +30% in 2012 compared to 2010
Source: Secondary Research
16
•
• •
Most Popular Travel Websites in India - 2011
Others 32%
Make My Trip 29%
•
Cleartrip 16%
Yatra 23%
Key Industry Challenges
Technology Acceptance
Volatility in Aviation Industry
This volatility not only impacts the inventory and pricing of tickets and hotel rooms, but also hurt consumer sentiments while making a purchase The internet availability, broadband penetration and the prevalence of online banking and credit/debit card is 16.0% very low in the country 12.0% 8.0% 4.0% 0.0% FY08 FY09 FY10 FY11 FY12 FY13
Low margins & high operating costs
On Air Bookings the company gets 3% commission on gross fare with Rs 50 to Rs 100 as service fee from the customer
Net revenue margins in Hotel business
The trend which was on a high since 2008 to 2010 is now expected to take a UTurn
Personal Acceptance
The habit of buying an air ticket is mostly through a travel agent and booking a hotel room is done for majority of times through calling the hotel directly or by turning up in person
Net Revenue Margins
14.0% 13.8% 13.5% 13.0% 10.6% 8.9%
We can probably offer solutions leveraging our reach in remote location and help spread awareness for technology based offerings from MMT
Source: Secondary Research
17
Key Growth Facts
•
Market share for OTA's in India 2010-2011
Others 10% Cleartrip 18%
•
•
Make My Trip 48%
•
Yatra 24%
• •
Indian travel industry grew by 13% to reach $23b in 2011, as compared to 2010. The online business is expected to grow faster, at 28% to reach $7b in 2011 from $4b in 2010 The key drivers for this growth are considered to be: • Growth of internet • Growth in low-cost carriers • Secure payment mechanisms The Online Travel Industry operates in segments like • Ticket booking - Air & Non Air • Tele Reservation • Car Rentals • Tour Packages In the above, Air travel dominates the current online travel industry in India with 60%+ market share The share of online travel bookings currently stands at 30 per cent and is expected to rise exponentially as the internet penetration increases in the country
Source: Secondary Research
18
Key Industry Trends
?
The world's largest travel portal Expedia foresees 2012 as the year when India will become the fastest-growing travel market in Asia-Pacific
The Travel Boom Emergence of Low Cost Airlines
• The volume of tourists in the country grew from 466.8m in 2006 to 710.6m in 2010, at 11.03% CAGR • OTAs are now looking for more offline counters leveraging on their brand value • The so called ‘No Frills Airlines’ has provided an opportunity for even average middle class to avail these services • The 2-3 star properties has made it cheaper for people to travel and stay, helping the OTA space grow at 30% • Online travel is the driving force in the e-commerce segment, with a global contribution of 70% of all e-commerce activities • Competition in online ticket booking is moving away from air to non-air segments • Online travel going mobile: changing e-travel to m-travel with Mobile penetration increasing considerable in the past few years and people are accessing the internet through their phones • Meta search engine is the latest innovation in online travel
Proliferation of Internet
Positive Economic Outlook
• India's strong economic forecast and positive business confidence will fuel growth in the travel intermediaries industry • Market growth would drive more mergers and acquisitions, and possible initial public offerings (IPO). • The Indian travel intermediaries industry is projected to grow from INR679.9b in 2012 to INR1,218.3b in 2016, at a CAGR of 15.7%
Source: Secondary Research
19
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
20
Financial Metrics (1/2)
Revenue vs. Profit– (2008-2012)
200
In $ million 150 100
68.55 83.56
61.07
40.28
Profit After Tax – (2008-2012)
196.59
Gross Revenue ($m) Gross Profit ($m)
124.72
25 15 In $ million
Profit After Tax ($m)
4.8 7.0
88.18
5 -5 2008 2009
-7.3 -18.9
2010
-6.2
2011
2012
50 0
38.33
16.5
24.99
-15 -25 2011 2012
2008
2009
2010
• • •
Air bookings take rates benefit from opaque fares in the period • Air bookings of $213mn were well above the estimated $184mn for 2012 • Net air revenue of $17.8mn, handily beat the $16.4mn estimate for the year Hotels and packages (H&P) segment outperforms on bookings • H&P gross bookings of $33.2mn came in well above the $26.9mn estimate in 2012 • Hotel net revenue of $3.2mn was in line with the estimate, despite higher gross bookings The company was able to take up there PAT from negative in 2008 to positive in 2011, which again saw improvement in 2012.
Source: Company reports - Deutsche Bank
21
Financial Metrics (2/2)
Operating Expenses – (2008-2012)
200
In $ million 150 100 50 0 2008 2009 2010 2011 2012
32.8 35.6 46.3 57.0 84.1
Operating Profit – (2008-2012)
20 15 10 5 0 -5 -10 -15 -20 Operating Profit ($m)
4.1 4.0
Operating Expenses ($m)
In $ million
2008
2009
-10.6
2010
-6.0
2011
2012
-16.3
•
•
Operating Expenses were a big shoot-up this year • The companies OpEx were on a high yet again since 2008 • This increased expenditure were due to the fact that the company invested in offering more reach to their customers in terms of local presence and are trying to expand to different geographies Operating Profit still struggling to grow • MMT was able to bring their negative operating profit to positive in the year 2011 which again dipped very marginally by $0.1m in 2012.
Source: Company reports - Deutsche Bank
22
Business Strategies (1/2)
1
Adding value to customers and stakeholders
Accelerate the mix shift from the lower margin air segment to the higher margin
3
2 4
Building a strong competitive position in fast growing market
Reducing the exposure to air ticket portfolio
Source: Company reports - Deutsche Bank; Secondary Research
23
Business Strategies (2/2)
Accelerate the mix shift from the lower margin Air segment to the higher margin – MMT believe that the company may be able to accelerate the mix towards higher margin Hotel and Packages business by adhering to certain aspects. They are:- (1) increased supply, (2) innovations on the payment side drawing more Indians to book online and, (3) conversion improvement from the Hotels internal feedback. MMT expect to benefit from the longer-term growth in the Indian travel market and the shift from offline to online bookings over time. The model continues to develop well on H&P revenues, where the company continues to add to supply and innovate on the user experience, which should lead to ongoing bookings and revenue growth in this higher margin segment Building a strong competitive position in fast growing market – As the company builds the hotel segment, it should ultimately lead to higher earnings power in the business in coming years. This would also help them build strong competitive position in a relatively fast growing emerging market by attracting different acquisition candidate for international OTAs seeking exposure to emerging markets. This would also help them maintain their buy rating on shares of MakeMyTrip, despite the challenging near-term environment.
1
2
3
Adding value to customers and stakeholders – Every OTA player today is focusing on providing more value for the customer’s time and money. The focus this year for MakeMyTrip is to move beyond customer satisfaction and towards creating customer delight. Being ahead on the technology curve is what gives them an edge as it is very important to keep on upgrading and reinventing new processes to enhance customer experience. Same is true for the suppliers as well, as the company always strive to provide them with the best environment to showcase their products
Reducing the exposure to air ticket portfolio – MMT is continuously focusing on non-air products to increase their share of revenue. They are trying to reduce their exposure to the air ticketing portfolio and increasing other verticals such as hotels and holidays. The mix which is currently 75:25 was 80:20 in 2011 and is expected to become 50:50 by 2016
4
Source: Company reports - Deutsche Bank; Secondary Research
24
Mergers & Acquisitions
Ticketvala.com – Feb 2010 MMT has acquired strategic assets from Ticketvala including website, URL, technology platform agent network, and bus inventory. Ixigo.com – July 2011 MakeMyTrip bought a stake in Ixigo.com, an online travel search engine, for $4.8 million
Luxury Tours and Travel Pte Ltd – March 2011 MakeMyTrip acquired a majority stake in this Singapore-based agency that provides hotel reservations and tours, for $3.4 million
My Guest House Accommodations Pvt. Ltd – Nov 2011 MMT bought a 29% stake in Delhi-based company for $1 million.
Source: Secondary Research
25
SWOT Analysis
• One of the earliest market entrants and holds a significant brand name • Carry experience from the international business scenarios • Secure and trusted channel for facilitating payments • Offers complete set of services related to the industry • Creating tailored holiday packages for the customers • Penetrate the offline market with more physical presence and create awareness for larger online transactions • Create m-commerce applications to attract more customers
Source: Secondary Research
26
• General Reluctance in customers to use internet for financial transactions like booking tickets online • Major business from Airlines tickets. Need to create a better mix of the revenue share
• Present competitors having substantial market share • Newly emerging online booking portals with similar offerings • Shift is contracting domestic standalone hotel inventory
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
27
News and Events (1/2) MakeMyTrip.com had the distinction of being
the most visited travel website
• According to comScore, the world's leading digital marketing intelligence and measurement service, MakeMyTrip.com was the most visited travel website in the period 2005-2009 and is still the leading in term of unique visitors. • It was also scored as the Number One travel website by JuxtConsult, a fully integrated market research company in India • MMT was also the Most Preferred Online Travel Agency by the Travel Biz Monitor Survey • MakeMyTrip.com has also emerged as the top seller among online and offline travel companies for all the major domestic and international airlines, as well as hotels
MMT - staying on top of technological developments
• MakeMyTrip.com provided customers with the facility of searching, booking and paying for their air tickets using their mobile phone. • This facility was also provided to non GPRS-enabled handsets • This eliminated the need for a computer or an internet connection and gave travellers the advantage of making their purchases from anywhere in the country, at any time.
Source: Superbrand India News; Economic Times
28
News and Events (2/2) MakeMyTrip appoints Sanket Atal as chief
technology officer
• In June this year, MMT announced the appointment of Sanket Atal as the new chief technology officer at to head the technology development and support teams in the travel company • This would strengthen their focus on technology and Innovation to drive the next phase of our evolution • CEO mentioned that with technology as the natural enabler in their business to fuel innovation and achieve excellence in customer experience, it is very necessary to keep updating with the trends in technology
MakeMyTrip has launched mobile apps for Android devices and the iPhone
• Following the launch of the Blackberry app, these apps would marks a comprehensive mobile suite from MakeMyTrip that offers its services across all mobile devices, and is designed to make travel planning fast. • With these apps available to download, MMT becomes one of the top five most-downloaded travel apps in India • The app also provides alerts on updated flight schedules and allows users to share their itineraries on Facebook and Twitter • It also uses the device’s GPS capabilities to find the closest restaurants.
Source: Economic Times; The Hindu
29
Content
• Company Snapshot • Organizational Structure • Business Segments • Geographical Coverage • Industry Analysis • Financial Metrics • Business Strategy & SWOT • News and Events • Opportunities for TATA • Appendix
30
Thank You
31
doc_728176811.pptx