Hotels to tickets: Travel return fuels growth for online travel aggregators

EaseMyTrip, Airbnb and OYO among companies reporting steady growth in business as pandemic wanes

As Indians travel with a vengeance after the pandemic, hotel aggregators and online ticketing platforms are reporting a surge in bookings that is helping their businesses recover.

Home-grown travel aggregator EaseMyTrip reported its gross booking revenue (GBR) at Rs 3,715.6 crore in FY22, up 74.6 per cent year on year (YoY) from Rs 2,128.4 crore in FY21.

Easemytrip, India’s second largest online travel platform, reported a total adjusted income of Rs 414.7 crore in FY22, up from Rs 201.3 crore the previous financial year.

“Alongside our strong focus on increasing revenue and market share, we continue to place equally weighted focus on operational efficiency and cost management. Our efforts paid off well, with EBITDA growing by 67.7 per cent to Rs 146.9 crore and profit after tax (PAT) increasing by 73.6 per cent to Rs 105.9 crore on a year-on-year basis,” Nishant Pitti, chief executive officer of EaseMyTrip, said in a regulatory filing recently.

“We also reported impressive performance within each of our business segments. Our Air segment grew by 57 per cent in FY 2021-22 and achieved market share growth underpinned by our constant customer engagement, customer acquisition and marketing initiatives. Our Hotel segment grew by 183 per cent through organic and inorganic strategy, while the Train, Buses and Other segment was up by 157 per cent,” Pitti said.

Easemytrip’s gross booking revenue (GBR) in Q2FY23 stood at Rs 1,977.7 crore, the highest ever in any quarter. On a consolidated basis, the company’s revenue from operations grew 91.5 per cent YoY to Rs 108.5 crore in Q2FY23 from Rs 56.65 crore in the same quarter last year.

The listed firm earns up to 92 per cent of its gross merchandise value from selling air tickets, and has a market share of up to 22 per cent in the online travel agency sector for air travel.

EaseMyTrip split its stock and issued bonus shares in November and has seen its shares jump over five-fold since listing at the BSE in March last year.

“With the revival of the travel industry, we saw great numbers in our last quarter. We did a business of Rs 1,663 crore and our extrapolated analysed GMV (Gross Merchandise Value) is approximately Rs 6,500 crore,” Pitti told Business Standard.

According to media reports, the third quarter ending December is also shaping up very strongly for the firm.

The firm’s rival, MakeMyTrip, also witnessed an 86 per cent uptick in revenue from $163.4 million in FY21 to $303. 9 million in FY22. MakeMyTrip’s losses narrowed to $45.6 million this year compared to $56 million in FY21.

Furthermore, revenue from the platform’s air ticketing business grew by 55.6 per cent to $88.7 million, while revenue from its hotel and packages business rose 131.4 per cent to $157.3 million.

Nasdaq-listed MakeMyTrip raked in $39.8 million from its bus ticketing segment, up from $24.8 million in the previous year.

Another large travel aggregator benefiting from a return to travel this year is Nasdaq-listed Yatra Online Inc.

The firm, which recently received Sebi’s approval to float an initial public offering for its Indian subsidiary, reported a 56.5 per cent uptick in revenue to Rs 198.9 crore in FY22 due to recovery in domestic travel demand, up from Rs 127.1 crore in FY21.

Revenue from Yatra’s air-ticketing business increased to Rs 115.05 crore in FY22 from Rs 89.3 crore during the same period last year. Further, its hotel and packages business grew from Rs 17.3 crore in FY21 to Rs 52.1 crore this year. Yatra’s losses also declined by 59.6 per cent for financial year 2021-22 to Rs 48.2 crore.

“Going forward, the OTA (Online Travel Agency) industry is expected to gain further traction across various segments,” said Pitti, of EaseMyTrip, in a regulatory filing. “A fast-growing tourism industry, rapid urbanisation, and increasing per capita income will also fuel the growth of the OTA industry.”

“The ongoing transformation of the Indian aviation sector is another key factor contributing to the sustained growth of the OTA industry. The government’s regional airport development programme promoting connectivity to smaller cities and towns, pending induction of over 585 aircraft, and infrastructure expansion are important factors in this regard,” he said.

According to Airbnb, domestic and overseas travel has grown this year. Overall night ticket booked in India grew by almost half and domestic nights booked grew by almost 80 per cent in Q3 2022 compared to Q3 2019, said the company.

Furthermore, in terms of overseas travel, the company saw a staggering increase of more than 1,250 per cent in searches for stays in Turkey, over 750 per cent spike in searches in Norway and a 625 per cent rise in searches for Portugal from Q3 of calendar year 2021 to Q3 of the current calendar year.

"As travel resumes across the globe, Airbnb is seeing a surge in interest among Indian travellers to venture overseas as well as explore destinations locally. This growing appetite for travel is a positive sign as tourism recovery gathers pace," said Amanpreet Bajaj, Airbnb’s General Manager for India, Southeast Asia, Hong Kong, and Taiwan.

Business travel has also made a strong comeback in India after two straight years of subdued sentiments. Hospitality major OYO recorded an 83 per cent YoY uptick in bookings in business cities, between April and November this year.