Yatra To Start Reverse Trading On NASDAQ, Gears Up To Launch Alternative Accommodation Portal

Online travel agency (OTA) Yatra has completed its reverse merger and is expected to begin trading on the NASDAQ, a global electronic marketplace for buying and selling securities, beginning from tomorrow, a report by ET said.

As per an official statement, the online travel marketplace Yatra will trade on NASDAQ under the symbol YTRA. The development comes five months after it entered into a reverse merger deal with NASDAQ-listed special purpose acquisition firm Terrapin 3 Acquisition Corp (TRTL). NASDAQ listed TRTL bought the Indian OTA firm in a multi-phased transaction, valuing it at $218 Mn.

In an official statement released on Monday, Yatra said TRTL will become a partially-owned subsidiary of Yatra, with the former’s leadership team heading the merged entity. TRTL, which is a special purpose acquisition company formed for the purpose of effecting a merger, acquisition, or similar business combination, had raised $212.75 Mn in its IPO in July 2014.

The combined company, post the merger, has been led by Yatra’s management team under the leadership of chief executive and co-founder Dhruv Shringi. The company’s stock has been priced at $10 before the opening trade.

Founded in 2006, Yatra counts Valiant Capital Management, Norwest Venture Partners, as well as Reliance Venture Asset Management Ltd, Web18 of TV18 Group and Intel Capital among its backers. During the fiscal year ended March 2016, Yatra customers reportedly booked more than 2.8 Mn air travel reservations and hotel stays with  atotal transaction value worth more than $900 Mn, an increase of 25% from the prior year.

Aviation, Mobile, & Hotel: Key Areas

Commenting on the development, Dhruv Shringi, CEO, Yatra said, “There are two or three key areas where we want to deploy the proceeds. First and foremost, we are seeing growth in India on the aviation side pretty much happen at a very broad level. It’s no longer restricted to the 15 metro cities, but is also now in the Tier II and Tier III towns. Every data seems to point to the fact that this will only grow. On the mobile technology front, these customers who are going to come online will come on the back of a mobile device. Thirdly, in addition to flights, these guys will also start consuming hotel products, which are primarily budget effective in nature.”

The company is also in the final stages of launching an alternative accommodation platform, including home stays, according to Shringi. With its upcoming launch of homestays, it will directly compete with MakeMyTrip, which also entered the space earlier this year with its home stay offering Rightstay.

According to the same report, Yatra’s home stay platform has already been launched in beta mode and will continue as such till January end of 2017.

The company is also banking on its partnership with Reliance, an existing stakeholder in the company, which will ensure the Yatra app to be already pre-installed on the company’s Lyf-branded 4G handsets.

“As part of this arrangement, 35 Mn Reliance Lyfe devices will have the Yatra app pre-installed on it. This will allow us to penetrate very deeply into Tier II and Tier III markets in India. It also allows us to accomplish this in a very cost-efficient manner,” Shringi added.

Important Deals In The Indian Online Travel Space This Year

It was an eventful year, to say the least, for the Indian online travel space. In February, Ibibo secured an investment of $250 Mn from Naspers, the South African internet and media company, and Chinese internet firm Tencent. Similarly, rival MakeMyTrip, which is already listed on NASDAQ, had raised an investment of $180 Mn from Chinese travel major Ctrip in January through convertible bonds.

Earlier this year, MakeMyTrip partnered with BookMyForex to allow international travellers to purchase the required foreign exchange from the website or mobile app.

Yatra, which claims to have 4 Mn customers in India was earlier rumoured to be in talks with mcommerce platform Paytm for a stake sale. This year, in January, Yatra acqui-hired Mumbai-based Travel-logs, which specialises in organising customised city walks and private tours. In June 2016, it acquired mGaadi, a Bangalore-based auto rickshaw aggregator. The terms of the deal are undisclosed.

In October 2016, in what can be said as the biggest deal in the travel space this year, MakeMyTrip bought Ibibo Group, for an undisclosed amount. And if the 34.1 Mn transactions processed together by the merged entities’ brands in FY2016 is not an indication of how big this deal is; in one strategic move, this deal has brought together two giants — Naspers and Ctrip and a whole lot of funding fuel for a more profitable business in the future.