homehospitality NewsUnicorn Health Check | Indian travel market expected to reach $125 billion by 2026 27
Unicorn Health Check | Indian travel market expected to reach $125 billion by 2026-27
The global travel and tourism industry went through a rough period during the pandemic, but has since bounced back quite quickly. The global market is set to surpass $8.9 trillion by 2026, growing at 3.1 percent CAGR from 2021 to 2026. The same can be said for India with the domestic travel market expected to reach $125 billion by FY27.
The global travel and tourism industry went through a rough period during the pandemic, but has since bounced back quite quickly. The global market is set to surpass $8.9 trillion by 2026, growing at 3.1 percent CAGR (compounded annual growth rate) from 2021 to 2026. The same can be said for India, with the domestic travel market expected to reach $125 billion by FY27.
OYO
The COVID-induced ban on travel hit hospitality chain OYO pretty badly in FY21. However, the company was able to claw back some lost ground in the last fiscal. Revenue from operations grew over 20 percent to come in at close to Rs 4,800 crore in FY22, while losses dwindled 51 percent to a little over Rs 1,940 crore; employee benefits emerged as the largest cost head for OYO forming around 27 percent of the overall cost.
Expenses total closed to Rs 7,000 crore in FY22 and on a unit level, the company spent Rs 1.46 to earn a single rupee. Valued at $2.7 billion, OYO plans to cut its IPO valuation by two-thirds when it goes public as per a Bloomberg report.
In a townhall held by the company's chief Ritesh Agarwal, OYO said that it would reach Rs 800 crore in EBITDA by FY24. The hotel chain is now preparing to file a fresh IPO document as soon as this week the report added.
Ixigo
Ixigo, which is backed by the likes of Invesco, Sequoia Capital, Elevation Capital and others, is valued at around $500 million pre-IPO. Ixigos’ revenues grew 2.8 times to Rs 379 crore in FY22 from a little over Rs 135 crore a year previously.
A steep rise in employee benefits and advertising costs dragged the company into losses, which came in at over Rs 21 crore. The company had reported a profit of Rs 7.53 crore in FY21. With a 290 percent surge in cost, the company's expenses came in at a little over Rs 402 crore. Ixigo spend Rs 1.06 to earn a single unit of operating revenue in the last fiscal.
While Ixigo has received approval from the market regulator to list on the bourses, the company is waiting for the right market conditions to go public.
MakeMyTrip
MakeMyTrip posted its highest ever operating profit in the December quarter on the back of a demand search for leisure travel and improved consumer sentiment. The company turned profitable after it reported profits of $200,000 versus a net loss of $9 million a year ago.
The company's revenue stood at $170 million and the travel aggregator is now thinking about an India listing — it is currently listed on the NASDAQ.
EaseMyTrip
Meanwhile, EaseMyTrip which is listed on the NSE, is backed by Nomura, HSBC, Sundaram Asset Management and others. The startup reported a 4 percent year-on-year growth in net profit, which came in at Rs 42 crore.
Now, revenue from operations surged 58 percent to Rs 136 crore, and the company's EBITDA for the third quarter improved to Rs 59 crore led by a healthy top-line growth and a persistent focus on operational efficiency. The company's expenses stood at Rs 82.5 crore.
Trends suggest that travellers are back on all travel segments, including leisure, business, pilgrimage and corporate events and this will drive growth in the coming years as well.
First Published: Mar 29, 2023 4:33 PM IST
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