Makemytrip Wants Money To Grow
Makemytrip.com, the largest online travel agency in India, is raising additional capital through a public issue.
This comes in the wake of its public listing on Nasdaq seven months ago. Based on the last-traded price of the scrip, this public issue could raise around $43M.
According to Bloomberg, the company is planning an offering of 6 million shares, or 17 percent of shares outstanding. In a filing with the US Securities and Exchange Commission (SEC), the company said it will use the proceeds to expand its operations, which could include investments in strategic assets or acquisitions. No such deals have been finalized yet, it added. A part of the funds raised would also go towards upgrading its technology and for working capital, said the filing.
The company has reason to want to spread its wings. In 2010, 1.6 million transactions for domestic air tickets in India were booked through its website, and the company generated $31.1 million in revenue (less service cost) from its air ticketing business. Revenue (less service cost) from Makemytrip's hotels and packages business totaled $8.0 million in fiscal year 2010. Makemytrip's hotels and packages business is an extension the company has been seeing growth in, and it currently accounts for 19.8% of its total revenue (less service cost).
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