ixigo Gets SEBI Nod For IPO

SUMMARY

ixigo was issued the observation letter by the markets regulator on May 14, shows SEBI document

The IPO comprises a fresh issue of shares worth INR 120 Cr and an offer for sale (OFS) component of 6.66 Cr shares

ixigo’s profitability factor as well as its focus on railway ticketing and targeting the Tier II and smaller markets are expected to be the major strengths for its IPO, believes analysts

Online travel aggregator (OTA) ixigo’s parent Le Travenues Technology Ltd has received a go-ahead for the INR 120 Cr+ initial public offering (IPO) from the Securities and Exchange Board of India (SEBI).

As per a latest SEBI notification, Ixigo was issued the observation letter by the markets regulator on May 14. This indicates an approval from the regulator to launch the public issue.

The Peak XV Partners-backed traveltech major refiled its draft red herring prospectus (DRHP) with the SEBI in February this year. The company’s IPO comprises a fresh issue of shares worth INR 120 Cr and an offer for sale (OFS) component of 6.66 Cr shares.

The startup plans to use INR 45 Cr from the IPO proceeds for its working capital requirements. Another INR 26 Cr would be deployed to ramp up its tech stack and scale up investments in data science and AI, among others.

Axis Capital, JM Financial, and DAM Capital Advisors are the lead book runners to the issue.

Founded in 2007 by Aloke Bajpai and Rajnish Kumar, ixigo started as a travel search website, helping 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.

Inc42’s recent interaction with analysts revealed that besides profitability, ixigo’s focus on railway ticketing and targeting the Tier II and smaller markets are expected to be the major strengths for its IPO.

The ixigo IPO has been in the works for nearly two years. The company first filed its DRHP for an INR 1,600 Cr public offering in August 2021. However, amid a market downturn, ixigo put its IPO plans on hold.

ixigo posted a consolidated net profit of INR 23.4 Cr in FY23 as against a net loss of INR 21.1 Cr in FY22. Its operating revenue also jumped 32% to INR 501.2 Cr in FY23 from INR 379.6 Cr in the prior fiscal.

For the nine months ended FY24, ixigo posted a net profit of INR 65.7 Cr on an operating revenue of INR 491 Cr.

It is to be noted that at least 10 tech startups are expected to get listed in 2024, which includes heavyweights like Swiggy (with an expected INR 8,300 Cr IPO) and Ola Electric (INR 7,250 Cr IPO).

This month alone three major startups have joined the IPO spree.

B2B travel portal Travel Boutique Online or TBO Tek made a debut on the public market last week at over a 50% premium.

Go Digit, which launched its IPO in mid-May, saw a subscription of 9.6X on the final day of its bidding on May 17.

Peak XV-backed coworking space provider Awfis also launched its INR 599 Cr IPO on Wednesday (May 22).