Ease My Trip, established in 2008 provides investors with a unique opportunity to invest in the fast-growing online travel agency industry. Being bootstrapped, the management of the company has tended to be extremely cost conscious and this has enabled them to be profitable since inception. Their primary driver of business is that they do not charge a convenience fee and this is what sets them apart from their peers like Make My Trip, Yatra and ClearTrip.

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This Strategy of the company has paid off handsomely during COVID and has ensured that they gain market share and become the second largest company in the market. Further the company has come up with industry first technological solutions in customer service like a chat box on the website which can give details about the cheapest priced tickets and its price movements.

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Ventura Securities believes that the let go of convenience fee coupled with the strong customer connection should enable them to continue to gain market share and ensure that the high growth continues. Ventura Securities recommends subscribing to the IPO at the price band of Rs 186-187.

Ventura Securities optimism stems from the following:

Ease My Trip has increased its market share from 3.1% in FY18 to 4.6% in FY20 and has been ranked 2nd among key OTAs in India based on booking volumes for 9M FY21.

Ease My Trip is the only player among the key online travel agencies (OTA) in India which has been consistently earning profits because as a 100% bootstrapped company it believes that incurring costs in the most efficient manner serves better while attracting customers as well as earning profits than spending on marketing and promotion activities. The table below shows a comparative analysis of costs borne by its peers Make My Trip and Yatra.

Ease My Trip is a net debt free and cash rich company wherein the cash reserves are only expected to improve. Ventura Securities think it is not too optimistic to expect that the company will pay dividends right from the start.

Ease My Trip has a customer first approach where customers have an option to not pay convenience fees (if they are not availing any other discounts) and get E-ticket and flight alerts through text messages. They also have in house call centers with web support for relatively quick resolution of customer queries/complaints.

Ease My Trip enjoys a significant amount of brand loyalty evidenced by stats like increase in mobile traffic from 65% in FY18 to 81% in FY20 and 87% in the 9 months period ended 31st Dec 2020, repeat transactions were done by 86% of the customers and they have a booking success rate of 98% in the 9 months period ended 31 st Dec 2020.

Ease My Trip being an end-to-end travel solution provider, they have the following revenue streams and the table below shows forecasts till FY23. Claims written back are a part of other income and represent the cancellation fees charged. It gets 2 years post receipt and hence we have assumed significant Rs 10 cr revenue from this stream in FY22 given the fact that cancellations during COVID were at a peak.