This IPO-corn travel company might become your favourite travel agency!

It was the early days of 2021? Fresh out of college, eyes full of dreams, and a heart ready to dive into the world of startups. That’s when I found myself at a seed-stage drone startup, eager to learn and build something that mattered. One day, while I was busy with my usual tasks, I overheard the founder drop a name: Nishant Pitti. He spoke about him with so much respect that it stuck with me, even though I had no clue who this person was. I brushed it off and got back to work—life moved on.

Fast forward three years, and guess what? That name popped up again. This time, curiosity got the better of me. I dove in, and what I found was fascinating. Turns out, Nishant Pitti is one of the masterminds behind EaseMyTrip—a company that not only survived in the cutthroat online travel space but thrived, even going public with an IPO. Building a company like that in a space dominated by giants like MakeMyTrip? That’s no small feat.

So, here we are, diving into the story of EaseMyTrip, the scrappy underdog that climbed its way to the top. Ready? Let’s get into it! But first, let’s meet the sponsors of today’s issue!

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Humble Beginnings: A gap in ecosystem

EaseMyTrip was founded in 2008 by brothers Nishant, Rikant and Prashant Pitti which was more or less a response to a very insignificant loophole in the already existing travel ticketing market. It was a personal experience involving their father’s frequent business travel as a coal trader. Rikant discovered that their father was being overcharged by a travel agent, prompting him and Nishant to take matters into their own hands by booking tickets online themselves to save money. Impressed by their work, their father became their first word of mouth agent and recommended them to his friends and family. It quickly gained popularity due to the cost savings they offered compared to traditional travel agents.

This turned into a full time venture which went by the name Duke Travels, operating from their garage and marketing their services through bulk SMS campaigns. Their breakthrough came when Air Deccan noticed a high volume of bookings from their email account and approached them to become their official travel agent. This partnership market a significant turning point, leading them to rebrand as EaseMyTrip. And hence it was born.

The Bootstrapping Journey

In 2008, with an initial capital of INR 15 Lakhs and after gaining substantial experience from their operations at Duke Travels, the Pitti brothers dived completely into EaseMyTrip and started focusing on the growth of the company. Completely bootstrapped, here is how the entire journey of the company looks like:

Initial Growth Phase (2011-2015)

• Transition to B2C model: After establishing itself as a B2B platform for travel agents, EaseMyTrip transitioned to a Business-to-Consumer (B2C) model in 2011. This shift allowed the company to cater directly to consumers, capitalizing on the growing trend of online travel bookings.

  Customer Acquisition and Marketing: The company employed aggressive marketing strategies, including bulk SMS campaigns and partnerships with airlines, to increase brand visibility and attract customers. This approach resulted in rapid customer acquisition and a growing reputation in the market.

  Expansion of Services: EaseMyTrip began expanding its service offerings beyond flight bookings to include hotels, holiday packages, and other travel-related services. This diversification was crucial in establishing itself as a comprehensive travel solution provider.

Significant milestones (2016-2020)

• Technological Advancements: The company invested heavily in technology to enhance user experience. The introduction of a user-friendly website and mobile app streamlined the booking process, making it easier for customers to plan their travel.

  Market Positioning: EaseMyTrip positioned itself as a cost-effective alternative to competitors by adopting a "no convenience fee" policy. This strategy attracted price-sensitive customers and helped build loyalty among users. This was one of the key factors that led to trust among its customers.

  Public Listing: In March 2021, EaseMyTrip went public, raising significant capital that facilitated further expansion. The IPO was well-received, reflecting investor confidence in the company's business model and growth potential.

Recent Developments (Post IPO)

• Post-Pandemic Recovery: The Covid-19 pandemic has a significant impact on the world, and it showed in the surge in the demand for travel. EaseMyTrip experienced a surge in demand for travel services as restrictions eased. The company used this opportunity and capitalized on pent-up travel demand, leading to increased bookings across all segments.

• Focus on Non-Air segments: In recent quarters, EaseMyTrip has strategically focused on growing its non-air business segments, including hotels, trains, buses, and holiday packages. For instance, In FY 2024, hotel night bookings grew by 49%, while other bookings (including trains and buses) increased by 67%12.

• Technological Innovations: The company has embraced artificial intelligence (AI) to improve customer service and booking efficiency. As an example, EaseMyTrip acquired CheQin.ai, to enhance its hotel booking platform with AI-driven features that “improve bargaining capabilities and booking efficiency.“

• Offline Expansion: To reach broader audiences, particularly in smaller cities where personal relationships are valued, EaseMyTrip plans to open 100 offline stores by the end of FY 2025. This initiative is part of a broader strategy to provide personalized customer experiences.

• Diversification into New Sectors: Recently, EaseMyTrip ventured into medical tourism by acquiring stakes in Pflege Home Healthcare and Rollins International for ₹90 crore total investment. This move aims to integrate healthcare services into its travel offerings.

The Business Model: Road to making money

Well, as far as the business model of the company is concerned, it operates a multifaceted model that integrates various distribution channels to cater to the diverse need of travelers. Following is a detailed breakdown of its business model, including its structure and revenue streams that have contributed to its growth.

• Distribution Channels: The company utilizes three primary distribution channels:

  • B2B2C(Business-to-Business-to-Consumer): By providing travel agents access to its platform, the company enabled them to book domestic flight tickets for their customers. This approach helped them tap into the existing offline travel market in India.

  • B2C(Business-to-Consumer): - As mentioned above, in 2011, EaseMyTrip expanded its operations to include direct consumer bookings, helping them cater to growing middle class population in India, who were increasingly looking for convenient and cost effective travel solutions.

  • B2E(Business-to-Enterprise):- Launched in 2013, this channel focuses on providing comprehensive travel solutions for corporate clients.

• Revenue Streams: EaseMyTrip generates revenue through various streams. These are as follows:

  • Commission from Bookings

  • Value-added services: Apart from booking travel, the company offers several ancillary services such as travel insurance, visa processing, and cab bookings.

  • Corporate Travel Solutions: Through its B2E channel, EaseMyTrip provides end-to-end solutions for corporate clients, including travel planning and management services that generate substantial revenue from business accounts.

While the above revenue model is not so significantly different from other companies in the similar space, or any other company in general, it is the customer centric approach EaseMyTrip adopts that makes it stand out and make it people’s first choice.

Customer is still the king

Some of the practices that the company follows to emphasize on customer retention are as follows:

• Zero Convenience Fees: While other online travel companies promises to offer get what you see prices on their platforms, there is usually a hidden charge in the name of “Convenience Fee“. EaseMyTrip, however, has no convenience fee whatsoever. This strategy has attracted price-sensitive Indian customers and built loyalty.

• Personalization through technology: Using Data Analytics & AI, EaseMyTrip personalizes its user experience enhancing customer engagement and increasing the likelihood of repeat customers

• In-house Customer Support: Unlike many online platforms that outsource customer service, EaseMyTrip maintains in-house call centers where trained staff handle inquiries and issues directly. This approach ensures a high level of service quality and customer satisfaction. For eg, you get a 100 percent refund on flight booking in case of a medical emergency, which no other competitor offers.

Current Standing: On its way to become the market leader

So, after being in the game for more than 15 years, what does current situation of the company look like? Well, it has established as a significant player in the online travel industry, particularly in the India market. Below is a detailed overview:

Market Presence:

1. Client Base: As of May 2024, the company serves approximately 2.6 crore customers, both in India and Internationally.

2. Service Diversification: The company has successfully diversified its service offerings beyond air travel; hotel night bookings increased by 39% & other bookings such as train, bus etc. rose by 53% in FY24. As of now, 88-89% of its business comes from air travel services down from 97% at the time of its IPO. The company further aims to reduces this share and increase its non-ir services to comprise about 25% of its businesses in the coming years.

3. Global Expansion Plan: EaseMyTrip is focusing on expanding its international presence and enhancing its offerings in non-air segments such as hotels and holiday packages 4. The company plans to continue emphasizing gross merchandise volume (GMV) while maintaining strong profitability.

4. New Ventures: The company is also testing its water in other industries. For eg, during the last fiscal, the company acquired 50% stake in Jeewani Hospitality to develop a 150-room Radisson Blu hotel in Ayodhya, catering to 1.5 lakh daily visitors. It Introduced EaseMyTrip Insurance Broker Private Limited, entering the Rs 7.9 trillion insurance industry to broaden service offerings beyond travel.

Financial Standing

1. Revenue growth: In Q3 FY24, EaseMyTrip reported a 13.5% increase in revenue from operations, reaching ₹160.8 crore, compared to ₹141.7 crore in the previous quarter. Year-on-year (YoY), this represents an 18.1% growth from ₹136.1 crore in Q3 FY23. For the cumulative nine months (April to December 2024) of FY24, the company posted a total revenue of ₹426.5 crore, with a profit of ₹118.5 crore

2. Record Profits: For the full fiscal year 2024, EaseMyTrip achieved a record profit of ₹215 crore, marking a 16% increase from the previous fiscal year. Revenue for FY24 grew by 32%, reaching ₹591 crore, making it the best financial year for the company so far.

3. Stock Performance: Since its IPO in March 2021 at ₹13 per share, EaseMyTrip's stock has seen significant appreciation, peaking at ₹66 per share in November 2022. Currently, it is trading around ₹51 per share, reflecting nearly a 300% growth, with a market capitalization exceeding ₹9,000 crore (approximately $1 billion)

Well, these numbers clearly suggest that EaseMyTrip is at a very good position as of now and how it performs in the near future will be an interesting thing to observe.

Now, we finally come to the last section of this case study i.e. business lessons learned from EaseMyTrip’s journey so far.

The Business Lessons: Basics Basics Basics…

Well, here’s what I think - The Pitti brothers didn’t try to reinvent the wheel; they just played their business basics - again and again, for years. And guess what? It worked. They focused on the fundamentals: cost-effective solutions, building trust, and never straying from what they knew best. No gimmicks, no shortcuts, just solid execution over a long period of time. So here’s the lesson from their journey: Play your business basics, for as long as it takes. Because sometimes, that’s all it really takes to win.

Well, that brings us to the end of this issue. I hope I was able to provide some value to your knowledge base by bringing this case study to you. If I did, share this within your network, and I will give you a special shout out with your message in my next issue. Don’t miss this chance to appear in front of an audience of 1600+ subscribers.

I will get back to you with more stories like these. In the meantime, take a look at these other interesting case studies:

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Keep tuned for more such case studies.
Until then,
Keep thinking!