EaseMyTrip eyes strategic acquisitions to fuel expansion across travel segments
In a strategic move to diversify and expand its presence in the travel industry, online travel platform EaseMyTrip is set to embark on a series of acquisitions during the current financial year. The company plans to focus on profitable and disruptive asset light businesses that align with its strengths, particularly in segments such as hotels, trains, and buses.
Prashant Pitti, Co-Founder of EaseMyTrip, revealed the company’s ambitious plans, stating, “There are a bunch of other acquisitions in the pipeline. We are only acquiring businesses that are profitable and can benefit from our strengths, and vice versa.”
In the recent September quarter of the fiscal year 2024, EaseMyTrip made significant strides in its growth journey. The company reported a robust performance, highlighted by its acquisition of 51 percent stakes in Guideline Travel Holidays, a prominent cruise provider, TripShope Travel Technologies, boasting a substantial B2B database of Kashmir, and Dook Travels, a travel service provider operating across Central Asian countries, Turkey, the UAE, and India.
EaseMyTrip’s financial results for Q2 FY24 were remarkable, with the company achieving its highest-ever profit after tax (PAT) of Rs 47.18 crore, marking a substantial YoY growth of 67.2 percent. One of the contributing factors to this growth was the implementation of convenience fees on specific sectors within the air segment, a departure from EaseMyTrip’s usual policy. This experimental move proved fruitful for the company’s revenue stream.
Pitti expressed confidence in the company’s continued growth momentum, anticipating a profit before tax (PBT) target of Rs 250 crore in FY24. The company’s Gross Booking Revenue (GBR) stood at Rs 2,025.58 crore for the quarter. Notably, EaseMyTrip sold 29 lakh air tickets, indicating a 2.3 percent YoY growth. The non-air segments, including hotel bookings, trains, buses, and more, witnessed substantial growth, with hotel nights bookings increasing by 60.2 percent to 1.2 lakh. Additionally, the other segment, comprising trains, buses, and related services, experienced an impressive uptick of 98.5 percent YoY, totaling 2.7 lakh bookings.
Pitti emphasized the company’s strategic shift, stating, “It has been 2.5 years since our listing, and every quarter our hotel, train, and bus bookings have grown more rapidly than flight bookings. In terms of gross booking revenue, we are currently at 90:10, with 90 percent coming from flights and the rest from other segments. Our goal is to shift this ratio to 80:20 in the next couple of years.”
Despite the challenges posed by the lean quarter in the travel industry, EaseMyTrip experienced growth across various segments. The air segment saw a modest 2.3 percent YoY growth in volumes during Q2 FY24. The hotels segment, contributing 4.1 percent to the total volumes, exhibited a remarkable growth of 60.2 percent YoY. The trains, buses, and others segment, contributing 7.2 percent of the total volumes, recorded an impressive growth rate of 98.5 percent in Q2 FY24.
EaseMyTrip’s strategic acquisitions and robust growth plans align with the optimistic outlook for the travel market in India. The total travel market in FY23 was estimated at Rs 277 crore, and it is expected to surge to Rs 404.5 crore by FY27. The online travel market, where EaseMyTrip operates, is currently valued at Rs 186.5 crore and is projected to reach Rs 298 crore by FY27, indicating significant growth opportunities for the company.
With its strategic acquisitions and focus on diverse travel segments, EaseMyTrip is well-positioned to capitalize on the burgeoning travel market in India, ensuring a promising future for the company and its stakeholders.