By Inc42 Media

SUMMARY

ixigo’s IPO comprises a fresh issue of shares worth INR 120 Cr and an offer for sale component of 6.67 Cr shares worth INR 620 Cr

ixigo is set to become the fourth new-age tech startup to go for a mainboard IPO in 2024 after Awfis, Go Digit, and TBO Tek

Its focus on railway ticketing and targeting of the Tier II and smaller markets seem to be the major strengths for its IPO

Online travel aggregator (OTA) Le Travenues Technology, the parent entity of ixigo, has set a price band of INR 88-93 per equity share for its upcoming initial public offering (IPO), which is opening for bids next Monday (June 10).

At the upper price band, the Delhi NCR-based startup is expected to raise a total of INR 740 Cr. ixigo’s IPO comprises a fresh issue of shares worth INR 120 Cr and an offer for sale (OFS) component of 6.67 Cr shares. 

As part of the OFS, cofounders Rajnish Kumar and Aloke Bajpai are selling 1.19 Cr shares each.  Its investor SAIF Partners India is selling 1.94 Cr shares and Peak XV Partners, 1.3 Cr shares. 

Other investors, including Micromax Informatics, Placid Holdings and Madison India are also selling portions of their stakes as part of the IPO.

Founded in 2007 by Bajpai and Kumar, Ixigo started as a travel search website to help users compare flight deals. In FY20, it became an OTA, earning revenue from selling various travel services like flights, trains, bus tickets, hotel bookings and holiday packages.

It is pertinent to note that ixigo, during India’s bullish IPO market in 2021, was eyeing to raise INR 1,600 Cr from its public offering in August 2021. However, like most other startups, amid a market downturn, ixigo has also lowered its IPO size.

ixigo is set to become the fourth new-age tech startup to go for a mainboard IPO in 2024 after Awfis, Go Digit, and TBO Tek, which have received varied responses from the market. 

For instance, insurance tech platform Go Digit made a rather muted debut in the public market at a premium of 3-5% over the issue price. Most recently, coworking space provider Awfis made a market debut at a premium of 12-13% range. Meanwhile, the public listing of B2B travel portal TBO Tek happened at a massive 50-55% premium.

Inc42’s recent interaction with multiple market experts revealed that the public market is currently more eager to subscribe to the public issues of companies that have some differentiating factors or have early mover advantage, besides the profitability and valuation factors also playing a role.

In the case of ixigo, its focus on railway ticketing and targeting of the Tier II and smaller markets seem to be the major strengths for its IPO.

Speaking during its pre-IPO conference on Wednesday (June 5), ixigo cofounder and CEO Bajpai reiterated that its differentiating story lies in solving travel requirements in smaller cities, and said, “ixigo is a unique Bharat story in this competitive space where you have multiple OTAs. But the lens through which we look at our users, the lens through which we look at the problems we need to solve the user problem, is very different.”

In fact, the company said that its differentiated approach gives ixigo the confidence to go public despite the current market condition, which is extremely volatile.

ixigo clocked a consolidated net profit of INR 68 Cr in the first nine months of FY24, up 3X from INR 23.3 Cr in the entire FY23. Its operating revenue also jumped to INR 491 Cr in the first nine months period of the previous fiscal from INR 501.2 Cr in FY23. 

Source: Inc42 Media