The country’s top online travel agency MakeMyTrip Ltd has acquired 18 per cent stake in Inspirock Inc, an online planning tool for developing customisable itineraries, the company has said.
The deal was done through MakeMyTrip's Innovation Fund, which was formed to invest up to $3 million in startups or early-stage companies in the travel technology space.
The deal will help the company to increase its capabilities in the online tour planning space, MakeMyTrip said.
Founded by two computer science grads from Stanford University- Anoop Goyal and Prakash Sikchi, Inspirock is a trip planning application that combines the usefulness of guidebooks and forums, making it easier for travellers to create day-by-day itineraries for upcoming trips.
Goyal and Sikchi, both have over couple of decades of experience with high-tech companies. Goyal specialised in consumer websites and data systems while Sikchi is into machine learning, big data and distributed systems.
Inspirock has partnered with travel agents who help its customers with additional planning necessities, like finding hotels, flights, trains, transfers, and even guides in foreign destinations.
This is the third investment by MakeMyTrip's $15 million Innovation Fund. Last month, the NASDAQ-listed company acquired certain assets of Mygola.com for an undisclosed amount and the entire Mygola team has joined MakeMyTrip as part of the deal. Mygola is also into travel planning space.
Prior to that in January, MakeMyTrip had picked a small minority stake in Bangalore-based travel tech startup Simplotel Technologies Pvt Ltd (Simplotel) for an undisclosed amount.
Financials
MMT reported a 27.5 per cent (28.4 per cent in constant currency) rise in revenues less service costs or net revenues to $36.4 million for the fourth quarter ended March 31, 2015 over the year-ago period.
Overall revenues rose 12.7 per cent (14.3 per cent in constant currency) to $68.6 million in the quarter while gross bookings, which represent the total amount paid by a customer while booking on its platform, rose 18.3 per cent (19.4 per cent in constant currency) to $404.3 million.
The net revenue in the hotels and packages category increased 48.8 per cent to $16.45 million in the quarter ended March 31, 2015 from the same period previous year. This was due to an increase in gross bookings of 14.8 per cent, 32.2 per cent increase in the number of transactions to 373,000 over the year-ago period and an increase in net revenue margin from 12.1 per cent to 15.7 per cent, driven by strong growth in its standalone hotel booking business.
The net revenue from air ticketing category increased 16 per cent to $18.67 million in the quarter. This was primarily due to an increase in gross bookings of 19.6 per cent. The transaction growth in the fourth quarter of fiscal year 2015 was largely driven by special fares offered by Indian domestic carriers and the ongoing shift from offline to online booking channels in both its domestic and international air ticketing business. While the number of air-ticketing transactions rocketed nearly 40 per cent last quarter to 1.44 million, the margins in the business shrank to 6.2 per cent from 6.4 per cent from Q4 FY14.
However, overall net revenues margins rose from 7.9 per cent to 8.7 per cent due to the hotels & packages business.
Operating loss almost doubled from $2.8 million to $4.9 million while adjusted operating profit (excluding employee share-based compensation costs, merger and acquisitions related expenses and amortisation of acquisition related intangibles) declined to $0.9 million as compared with $1.3 million in the quarter ended March 31, 2014.
Net loss was $5.9 million as against loss of $2.7 million in Q3 FY14 while adjusted net loss (excluding employee share-based compensation costs, M&A related expenses, amortisation of acquisition related intangibles, net change in value of financial liability in business combination, and income tax benefit) increased to $1.7 million as against $0.5 million in the year-ago period.
"In line with the strategic objectives we had shared at the beginning of the year, our hotels and packages business accounted for 45 per cent of our full year revenue less service costs. In the fiscal fourth quarter, mobile users accounted for more than 40 per cent of total online traffic and 22 per cent of online transactions in India," said Deep Kalra, group chairman and Group CEO.
In the year ended March 31, 2015, the firm recorded 30.6 (32 per cent in constant currency) per cent rise in net revenues to $139 million. This was led by 56.6 per cent rise in net revenues from hotels & packages segment. It reported 6.81 million transactions for the full year.
For the full year ending March 31, 2016 the company has given a guidance of revenue less service costs growth in the range of 22-26 per cent (in constant currency). The firm said it expects to see more contraction in net revenue margin for air ticketing business.