Exploring the Ixigo IPO - Key Details You Need to Know
Key Highlights
- The fresh issue of Le Travenues Technology Ltd comprises equity shares aggregating up to Rs 120 crores
- The offer for sale consists of up to 66,677,674 equity shares
With the Lok Sabha elections over, the focus is back on markets and initial public offerings (IPOs). Though markets tumbled sharply following the declaration of results, India's growth story is very much intact. Le Travenues Technology Limited, the parent company of travel aggregator Ixigo, will hit D-street soon.
About Le Travenues Technology Limited
Le Travenues Technology Limited is a technology company that empowers Indian travellers to plan, book and manage their trips across rail, air, buses and hotels. The company assists travellers in making smarter travel decisions by leveraging artificial intelligence, machine learning and data science-led innovations on its OTA platforms. As per the F&S report, the company is the leading OTA for the next billion users, with a focus on localised content and app features aimed at solving the problems of tier II and tier III travellers.
IPO Details and Objectives
The company’s IPO consists of a fresh issue and an offer for sale. The fresh issue comprises equity shares aggregating up to Rs 120 crores, while the offer for sale consists of up to 66,677,674 equity shares. The company plans to use the proceeds received from its IPO to:
- Part-fund its working capital requirements
- Invest in cloud infrastructure and technology
- Fund inorganic growth through unidentified acquisitions
- Meet other strategic initiatives and general corporate purposes
Financial Snapshot
Here are some critical financials of the company:
| Particulars | FY 23 | FY 22 | FY 21 |
|---|---|---|---|
Total assets (in crores) | Rs 585.925 | Rs 538.471 | Rs 185.071 |
Total income (in crores) | Rs 517.573 | Rs 384.941 | Rs 138.406 |
Total expenses (in crores) | Rs 484.292 | Rs 402.541 | Rs 135.699 |
Diluted earnings per share | 0.57 | -0.66 | 0.25 |
Return on Net Worth | 5.74% | -7.15% | 24.13% |
Company’s Key Strengths and Strategies
Here are the key strengths of the company:
- It is the leading OTA for the ‘next billion user’ with the highest monthly active users for mobile apps across all key OTAs as of September 30, 2023
- Established consumer travel brand built with a user-first approach
- Diversified business model with high operating leverage and organic flywheel
- Experienced management team with a lean organisation structure
Some of the key strategies the company plans to adopt going forward are:
- Continue to deepen its penetration and enhance its offerings for the 'next billion user' market
- Increase monetisation through cross-selling and up-selling
- Improving operating leverage through investment in deep tech and artificial intelligence
- Drive value creation through selective strategic partnerships and acquisitions
Industry Overview
The travel industry has benefited from direct government policies to increase domestic and inbound travel to India. The government policies are active in all air, road, and rail segments to move the masses across the country in the most efficient manner. As per the World Travel & Tourism Council, Indian travel and tourism spending was Rs 16.5 trillion in the 2023 fiscal with an equally high contribution to GDP at 9.7% for fiscal 2023.
The Indian travel and tourism market for air, road, air and hotels accounts for around Rs 3,808 billion. This is expected to grow to Rs 5,904 billion in the fiscal 2028. The overall travel market is expected to grow at a CAGR of 9%.
Summing it Up
Go through the company’s red herring prospectus for an overview of the IPO and its associated risks. Ensure that investing in the IPO fits your overall financial strategy and risk tolerance.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. It is not produced by the desk of the Kotak Securities Research Team, nor is it a report published by the Kotak Securities Research Team. The information presented is compiled from several secondary sources available on the internet and may change over time. Investors should conduct their own research and consult with financial professionals before making any investment decisions. Read the full disclaimer here.
Investments in securities market are subject to market risks, read all the related documents carefully before investing. Please read the SEBI prescribed Combined Risk Disclosure Document prior to investing. Brokerage will not exceed SEBI prescribed limit.
FAQs
Who is the Registrar of the Le Travenues Technology Limited’s IPO?
Link Intime India Private Limited is the registrar of the IPO.
Who are the Book Running Lead Managers of Le Travenues Technology Limited’s IPO?
Axis Capital, DAM Capital Advisors Limited, and JM Financial Limited are the book-running lead managers of this IPO.
