Online travel agency Yatra Online, headquartered in India and listed on the Nasdaq since 2016, is set to launch its initial public offering (IPO) on September 15. This move comes after the company filed a draft red herring prospectus with the Securities and Exchange Board of India (SEBI) on March 25 the previous year, aiming to raise up to $97.5 million.
Yatra’s upcoming IPO will consist of a fresh issue of shares valued at $73.5 million (INR 6.1 billion), a reduced amount compared to the initial target. However, the company has secured a pre-IPO placement of approximately $7.5 million (INR 620 million) with one of its promoters, THCL.
Until now, Indian travel firms eyeing IPOs had adopted a “wait-and-watch” approach, with companies like Ixigo and Oyo also in the pipeline.
A significant portion of the proceeds from the fresh issue, totaling $18.1 million (INR 1.5 billion), will be allocated for strategic investments, acquisitions, and supporting inorganic growth. Additionally, the company has earmarked around $48 million (INR 4 billion) for customer acquisition and retention, technological advancements, and various other initiatives aimed at organic growth. The remaining funds will be directed toward general corporate purposes.
CEO Dhruv Shringi, in a previous discussion with Skift, emphasized the expansion of the company as a primary use of the IPO funds, stating that they would also invest in technology and bolster their sales workforce for customer acquisition. Shringi further indicated that Yatra would continue to explore potential acquisitions.
In November, SEBI issued the final observation letter to Yatra, granting it the flexibility to launch the IPO within a 12-month window. Initially planning to kick off the IPO in March, Yatra commenced its investor outreach in India during the early part of the March quarter. However, the process took longer than expected due to the overall macroeconomic environment and global market sentiments, as highlighted by Shringi.
As of now, Yatra has not disclosed its financial results for the quarter ending in June.
In the latest earnings call, Yatra reported revenue and adjusted revenue of $14.4 million (INR 1.2 billion) and $22.9 million (INR 1.9 billion), respectively, for the quarter ending on March 31, 2023.
This represents a notable turnaround compared to the corresponding quarter in the previous year, when the company incurred a loss of $642,989 (INR 53.4 million). In the first quarter of 2023, Yatra reported a profit of $90,488 (INR 7.5 million), with adjusted EBITDA reaching $2.2 million (INR 185.6 million), marking a substantial increase of 251%.
