Early recovery for travel portals, little impact of likely third wave seen

Higher pace of vaccination, lifting of lockdown curbs is aiding recovery; but it is clipped as only 72.5% of airlines are allowed to fly as per present rules

Local travel is showing early signs of recovery with business climbing to 40-50 per cent of pre-Covid levels, heads of online travel start-ups said. Higher pace of vaccination and lifting of lockdown curbs in most places in India is aiding recovery; however, it's clipped because only 72.5 per cent of airlines are allowed to fly as per present rules, executives said.

EaseMyTrip, one of the leading OTAs, said it clocked Rs 225 crore gross sales in July as compared to Rs 356 crore in April-June quarter and Rs 907 crore in January-March quarter. “From whatever of August we have seen so far, we see it faring better than July,” said Rikant Pitti, co-founder, EaseMyTrip in an interview.

He said vaccinations in the country have given confidence to travellers and the effect of the third wave, if there is one, will be less severe. “The vaccination drive is helping tremendously. Those who are fully vaccinated are going to travel. At company level, we are not worried about the third way as travellers are more confident this time around,” said Pitti.

Interest is also recovering for international destinations, according to Ixigo. “Search inquiries for travel to international destinations saw an increase of 45-50 percent in the first week of August 2021 as compared to the same time last month. Countries people are searching for include Maldives, Switzerland, Germany, Qatar, Turkey, Nepal and France,” said Aloke Bajpai, co-founder and chief executive Ixigo.

However, according to data, air travel recovery is slower than some companies might like to think. Passenger traffic on all Indian airports combined averaged 16.8 million each month, over January to March this year, before falling to 12.5 million in April, according to the Airports Authority of India. The figures in May and June came to be 4.5 million and 6.5 million respectively.

Table: Passengers volume (in  million)

Month	January	February	March	April	May	June
Passengers	16.73	16.87	16.95	12.46	4.46	6.51

Source: Airports Authority of India

During the pandemic, the Directorate General of Civil Aviation (DGCA) regulated flight operators’ capacity. In the second wave, the domestic capacity—reduced from 80 percent of pre-Covid to 50 percent on 1 June—was first increased to 65 per cent in July and is now at 72.5 per cent. Executives said they are waiting for such conditions to be lifted.

In terms of local travel, metro-to-metro and non-metro to metro travel is also bouncing back. Some large corporations have announced plans to re-open offices, leading to re-influx of the workforce, while travel for personal reasons—including marriages—is picking up too albeit marginally.

As per to train bookings data on Ixigo, routes Chennai-Coimbatore, New Delhi-Chandigarh, and New Delhi-Kanpur, saw bookings rise 23 per cent, 37 per cent and 17 per cent, respectively, in the first week on August as compared to the same time the previous month.

Ixigo, for one, is in the process of launching its initial public offering, which points to the company’s estimates for sustained recovery in the near term. On August 13, the 12-year-old firm filed papers with Securities and Exchange Board of India for a Rs 1,600-crore public offer, which includes Rs 750 crore of fresh equity and Rs 850 crore of offer-for-sale.

Before announcing IPO plans, Ixigo also made two small acquisitions: train booking platform Confirmtkt and bus ticketing platform AbhiBus.

Seeing the pick-up in business, leading OTAs such as MakeMyTrip and Cleartrip had also recently announced plans to hire fresh talent. MakeMyTrip, according to a media report, has 200 vacancies open across technology, product, design and revenue management. ClearTrip is also looking to hire “aggressively”, the company told a media outlet.

Patti of EaseMyTrip said in the Covid-19 period online travel peaked in February to 70 per cent of the pre-Covid business, before the second wave, and ensuing lockdown, hit. The industry is currently around 40-50 per cent of pre-Covid levels.