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Decoding the financial performance of India's top OTA players

EntrackrEntrackr · 1y ago
Decoding the financial performance of India's top OTA players
Medial

India's top online travel agency (OTA) players, including MakeMyTrip, Ixigo, EaseMyTrip, and Yatra Online, have reported significant growth and profitability in the last financial year. MakeMyTrip led the pack with a 95% increase in operating revenue, making the majority of its revenue from hotels and packages. Ixigo also saw growth and turned profitable, while EaseMyTrip achieved impressive growth and profitability mainly through air ticketing. Yatra Online also witnessed growth and profitability, generating revenue from air ticketing, hotels and packages, and advertising. However, Cleartrip experienced a decline in scale and increased losses. The market remains attractive for these players due to the expanding middle class and rising overseas travel.

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Decoding Q2 FY25 for OTAs ft. MMT, Ixigo, EaseMyTrip and Yatra

EntrackrEntrackr · 6m ago
Decoding Q2 FY25 for OTAs ft. MMT, Ixigo, EaseMyTrip and Yatra
Medial

Indian online travel agencies (OTAs) business has bounced back after the pandemic on the back of revenge travel and the increased appetite of Indians towards leisure and business travel. The increased share of wallets on travel led to growth across four major OTAs in Q2 FY25. MakeMyTrip (MMT) continued to dominate the online travel space, but recently listed Ixigo has emerged as the second-largest OTA based on this metric. While we will discuss Ixigo later, let's focus on MMT for now. MakeMyTrip reported Rs 1,354 crore in revenue minus service costs in Q2 FY25. The last quarter was the best ever quarter for MMT in terms of profit as its profit after tax (PAT) zoomed almost 9X to $18 million, as compared to the corresponding quarter last year (Q2 FY24). Income from air travel grew 25.2% amounting to Rs 512 crore in Q2FY25 when compared to Q2FY24 while revenue hotels and package services contributed Rs 496 crore (revenue less service cost) and grew 15.3% quarter-on-quarter. Bus ticketing and other services (including trains) stood at Rs 210 crore and Rs 185 crore, respectively. Ixigo has turned out to be the second largest OTA player as the firm registered 25.6% growth to Rs 206 crore in Q2FY25 from Rs 164 crore in Q2FY24. It reported a profit of Rs 13 crore in the same period. On the revenue front, income from train bookings was the largest, contributing 53% which increased 19.1% QoQ to Rs 110 crore (minus service cost) in Q2FY25. Collection from the bus and air increased 42.8% and 37.45% to Rs 40 crore and Rs 56 crore, respectively, in Q2FY25. EaseMyTrip, on the other hand, posted a flat growth with its modest revenue less service cost growth to Rs 131 crore in Q2 FY25 from RS 130.7 crore in Q2 FY24. However, according to IFRS, its revenue from operations stood at Rs 145 crore in Q2FY25 with the profits dwindling by 42.6% to Rs 27 crore in Q2FY25, as compared to Rs 47 crore in Q2FY24. Income from sale of flight tickets decreased by 20% to Rs 116.2 crore in Q2 FY25 from Rs 116.2 Q2 FY24. Whereas the hotels and other allied services saw an increase of 144% and 64.5%, respectively. Yatra, listed on NASDAQ (operational in India), has recorded 20% quarter-on-quarter growth in revenue less service cost to Rs 94 crore in Q2 FY25. However, the company posted 2.5X growth to Rs 236 crore in Q2FY25, if we don't exclude the service cost component. In Q2 FY25, the company generated Rs 43.3 crore from its air ticketing segment, Rs 30 crore from hotels (net of discounts and service fees), Rs 7.5 crore from bus/train bookings, and Rs 13.5 crore from other operating activities, including advertising.

Decoding the financial health of leading cloud kitchen startups

EntrackrEntrackr · 1y ago
Decoding the financial health of leading cloud kitchen startups
Medial

The restaurant industry is witnessing a transformation with the rise of delivery-only models known as ‘cloud kitchens’, ‘virtual kitchens’, or ‘ghost kitchens’. These innovative concepts are reshaping how food is prepared, delivered, and consumed, challenging traditional restaurant models. According to a Redseer report, the estimated size of the cloud kitchen market would touch $3 billion by 2024, from $400 million in 2019. Moreover, top startups operating in the segment mopped up around $600 million in funding in the past three years and close to $1 billion since their inception, according to the startup intelligence platform TheKredible. Among India’s top cloud kitchen startups, Rebel Foods stands out as the poster boy with a topline of around Rs 1,200 crore in FY23. The list further includes Curefoods, EatClub, Biryani By Kilo, FreshMenu, Biryani Blues, Kitchens@, Bigspoon, Dil Foods, and HOI Foods. [Top funded cloud kitchen startups] Rebel Foods, which operates brands like Faasos (now EatSure), Oven Story, Lunch Box, The Good Bowl, Behrouz, Sweet Truth, and Firangi Bake, also emerged as the sole unicorn from the cloud kitchen space. The Peak XV Partners-backed company alone raised over $535 million to date whereas Curefoods scooped up around $170 million from the likes of Binny Bansal’s Three State Ventures, IronPillar, Chiratae, and Accel. In December 2023, Kitchens@ raised $65 million from London-based private equity firm Finnest. It’s worth highlighting that the firm also acquired Swiggy’s cloud kitchen’s business ‘Access Kitchens’ in a share swap deal in March last year. To recall, Swiggy entered the cloud kitchen business back in 2017. EatClub raised around $75 million across rounds including a $40 million round led by Tiger Global in December 2021. In 2022, it was also in the news for a secondary round worth $30 million. The firm operates several popular cloud kitchen brands such as Box8 and Mojo Pizza. Biryani By Kilo recently raised $9 million in an ongoing round, pushing the company’s total fundraise to $55 million to date. [Top revenue-generating cloud kitchen startups in India] Rebel Foods’ revenue from operations grew 39.2% to Rs 1,195 crore in FY23 from Rs 858.6 crore in FY22. Curefoods and EatClub follow closely, with revenues exceeding Rs 300 crore each. Biryani By Kilo also claims a revenue of around Rs 300 crore in FY23. However, beyond these frontrunners, no other brands have crossed the Rs 100 crore revenue mark as of March 2023. FreshMenu, Biryani Blues, and Kitchens@ recorded 7.5%, 53.7%, and 64.8% growth in revenue to Rs 70.21 crore, Rs 68.54 crore, and Rs 61.6 crore, respectively during FY23. While Dil Foods and HOI Foods posted Rs 7.08 crore and Rs 2.85 crore operating revenue during the year. [Spending by the cloud kitchen brands in FY23] Rebel Foods spent 31.6% of its total expenditure on the cost of materials amounting to Rs 577.54 crore while 22.2% or Rs 405.46 crore on the employee benefit cost. The overall cost of the company surged 27.9% to Rs 1,827 crore during FY23 from Rs 1429 crore in FY22. Curefoods, EatClub, FreshMenu, and Biryani Blues also spent the most on the cost of materials accounting for Rs 171.7 crore, Rs 126.17 crore, Rs 27.48 crore, and Rs 25.88 crore respectively. Whereas, employee benefit costs of these brands stood at Rs 103.5 crore, Rs 99.5 crore, Rs 17.31 crore, and Rs 14.2 crore. Kitchens@, Dil Foods, and HOI Foods spent the most on employee benefits followed by the cost of materials. In line with revenue, Rebel Foods is also on top in terms of losses. Though, the rise in losses is lower than revenue growth. The company’s losses went up nearly 23% to Rs 656.5 crore during FY23. Curefoods’ bottom line jumped 4.7X to Rs 342.7 crore while EatClub’s losses rose 53.8% to Rs 69 crore during the period. Kitchens@ (Rs 27.3 crore), Biryani Blues (Rs 15.42 crore), FreshMenu (Rs 10.15 crore), HOI Foods (Rs 1.23 crore), and Dil Foods (Rs 0.9 crore) are next in line in terms of losses. [A look at unit economics of top cloud kitchen brands] On a unit level, Rebel Foods, Curefoods, and EatClub spent Rs 1.53, 1.97, and 1.25 to earn a rupee of operating revenue in FY23. Despite their impressive revenue growth, profitability remains a challenge for many cloud kitchen startups. [Conclusion] When we compare the numbers of these players with the large listed players, we see a clear difference in critical cost heads like cost of material, employee costs. Those are areas that will need a continuous improvement in metrics, for these firms to make a serious push for profitability. While some like Freshmenu are in a clear battle to survive until the market turns into a less hostile environment, almost none of these firms can afford to burn through funds as they did in the pre-pandemic years. Even as customers seem to be reconciling to the sharp increase in sticker prices on the menu, pressure on margins from delivery, fast turning into duopoly, will ensure there is little respite in the immediate future. It will take some significant structural changes in the market, in terms of opportunity as well as growth drivers, for these firms to truly sizzle.

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