M&A Project - Group 6

MakeMyTrip & Ibibo

Aditya Krishan Agarwal (PGP31247) | Ashish Goel (PGP31141) | Nitish Rathi

(PGP31039) | Sanchit Jain (PGP31108) | Shreyak Gupta (PGP31233) |
Suyash Sengar (PGP31354) | Utsav Kumar (PGP31297)

Table of Contents

Industry Background...........1
Make My Trip.3
Ibibo Group4
Deal Details5
Combined Entity5
Merger Timeline6
Stakeholder Reactions.6
Financial & Regulatory Constraints7
Valuation using DCF7
Relative Valuation..10
Anticipated & Realized Synergies11
Future Outlook12
Learnings.13
References..14

Industry Background

The Indian travel market has managed to continue its growth run over the past many
years. India has attracted travellers from around the globe across segments such as
business, leisure, medical etc. The total Indias travel market stands at $30 billion as of
Oct 2016 and is extended to grow to around $50 billion by 2020.

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Tourism in India has seen a significant push in the recent years considering the rich
cultural and historical heritage, variety in ecology, terrains and places of natural beauty
spread across the country. Tourism has also helped as an employment generator as
well as being a source of foreign exchange for the country. India has seen a growth of
4.4% in the number of foreign tourists visiting India during the period January-December
2015 which stood at 80.16 lakh. The government has also launched various initiatives
like E-Tourist Visa facility which will lead to an increase in the number of international
tourists visiting India. On the domestic front, India is amongst the fastest growing
domestic air travel market in the world.

The industry is fragmented with multiple dominators. Over the last few years established
global travel giants and first generation Indian start-ups have played an important role in
developing the Indian travel market. For instance, the online travel market alone is
expected to be around $17 billion i.e. around 40 per cent of the total transactions by
2020. The largest growth is expected to be in the Tier-II and Tier-III cities. The current
online penetration for the various segments is Hotels (19%), Airlines (52%), Railways
(43%) and Buses (15%).

The hotel segment has the highest margins for Online Travel Agents (OTA). This
segment has seen the highest competition for the last few years. Hotel segment will
play a major role in contributing towards the growth of the online travel segment. Mobile
has become a major platform for online travel bookings. The transactions on mobile as
percent of total online travel bookings has been increasing sharply, and now account for
63% in hotels and 34% in flights. Further, Governments digital India drive, Jios entry
into 4G are few of the key drivers in accelerated offline to online shift.

Overall, the Indian travel market has matured and is all set to cash-in on the increasing
penetration and acceptability across domestic and international markets. India is the
next big internet market, and the travel marketplace in it, is known to be very
competitive. The stage is set for some consolidation in this space to realize synergies
and efficiencies, while at the same time, reducing discounts.

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Make My Trip

Makemytrip Inc. is an Indian online travel company, founded by Deep Kalra in 2000.
Headquartered in Gurgaon, Haryana, the company provides online travel services
including flight tickets, domestic and international holiday packages, hotel reservations,
rail and bus tickets, they have also ventured into Forex. The company has been
recognized as one of India's best travel portals.In addition to a full-service online portal,
the company also operates through 65 retail stores across 50 cities in India, along with
international offices in New York City and Sydney.

The firm started off with an initial aim of catering to the increasing India-US travel needs
of the Indian diaspora in the US market. With the success of IRCTC as an online travel
portal and Indian travellers purchasing tickets online there was an opportunity in the
OTA segment in India. The entry of low cost carrier airlines in India marked Make My
Trips entry in the Indian market when they started offering flight tickets to travelers
online in 2005.

Make my trip went public on NASDAQ in 2010 with total subscriptions worth $1bn and
an 89% rise in share price on Day 1 of listing. By 2011, MMT entered the high margin
hotel business by acquiring ITC Group and Hotel Travel Group to expand its business
and improve revenues. 2011 also marked the launch of travel and travel booking centric
mobile applications by MMT, it was termed as a futuristic move to capture the
expanding smartphone market in India. In, 2014 MMT started investing in early stage
startups and catered a fund of $15mn for the same. They invested in startups such as
MyGola, Bona Vita and Holiday IQ. They also acquired certain OTA websites such as
EasyToBook.com etc. Investments pouring in from Chinese investor CTrip which

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invested a total sum of $180mn in Make My Trip. It was anticipated as a move to
consolidate the Indian OTA market similar to that of the Chinese market.

Key Performance Indicators for the Company:

Total revenues of $384.1mn in Sept, 2016 - highest for any OTA player in India
Increase in overall margins (revenues - service cost) by 50.9% YoY for 2
quarters in FY17
Increase in number of transactions - Standalone Hotels online bookings
increased by 292.7%, the same on mobile grew by 453.6% and growth in sales
of hotel packages was 172.7%
Number of application downloads have soared with the smartphone revolution
picking up in India, the current number for Make My Trip stands at 27.5mn

Ibibo

ibibo Group is an online travel organization founded in January 2007 by Ashish

Kashyap and is registered in Singapore. The company is a subsidiary of Naspers, which
owns an 91% stake in Ibibo Group. The group owns the B2C online travel aggregator
Goibibo, and online bus ticketing platform Redbus.in, and has a 51% stake in the B2B
travel website travelboutiqueonline.com. The company also owns a minority stake in
Naspers' payment gateway business PayU Global

GoIbibo is Indias largest online travel group with integrated travel properties and it
started operations in 2009. It launched the instant refund for the first time in India in
2011, post the launch of payments platform in 2010 which was later named PayU, By
2012, GoIbibo had launched online ticket rescheduling, bus ticketing and overseas flight
bookings. GoIbibo mobile application was launched in 2013, the same year also marked
the entry of Ibibo into online hotel segment. With the acquisition of redBus.in in 2013,
ibibo strengthened its Bus ticketing network.

In only a year Goibibo saw a million application downloads and further foray into the bus
ticketing was realized through the acquisition of YourBus.in. Goibibo entered the budget
hotel accommodation segment in 2015, the year also marked 10mn application
downloads and 2.5mn wallet downloads for the ibibo group. Feature additions such as
in app mobile banking were launched in 2015. RedBus became profitable for the first
time in 2016 and Naspers invested another $250mn in ibibo group. Additional features
such as live flight tracking were launched. Goibibo further expanded its business with
services such as Ryde (car and cab sharing application) and goCars; RedBus started
offering bus ticketing services internationally in 2016.

Key Performance Indicators for the company:

Doubling of total revenues in FY16 to $38.9mn but losses also doubled to
$106.5mn. 80% transaction were through mobile in FY17
Extensive sales and ad expenses - amount tripled to $99mn in FY16

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 Total transaction volume - 23.7mn and total application downloads of 24mn
Growth in hotel transactions by 420%, air ticketing transactions by 90% and bus
transactions by 60% were the major gains for GoIbibo

Deal Details

The deal was an all equity one, creating an entity valued at around $1.8-$2 billion. MMT
shall own 60% of the equity of the combined entity while Ibibo will own 40%.

Majority equity holders of Ibibo shall now become majority owners of the merged entity.
Nasper and Tencent who owned 91% and 9% in the ibibo Group shall sell their stake to
own 40% of the merged entity. Nasper becomes the single largest shareholder. Ctrip
International Ltd shall convert the 5 year convertible bonds worth $180 million to an
equity holding of ~10%. Merged entity to have 10 directors: 4 from Naspers and
Tencent, 1 from Ctrip, 2 of MMT Promoters and 3 independent.

Kalra will remain as group chief executive and executive chairman of Makemytrip, and
cofounder Rajesh Magow will continue to remain CEO for India. Ibibo Group Founder
and CEO Ashish Kashyap, will join Makemytrip as a cofounder and president of the
organization.

Combined Entity

The merger between MMT and Ibibo is a horizontal merger, as both players belong to
the OTA space. The combined entity post-merger will have the following numbers,
which are indicative of almost a monopoly in this space. With the merger, the combined
entity (MMT and goibibo) has become the online travel behemoth of the country. The

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combined entity will have an approximately 70 percent market share in the online hotel
space and 60 percent share in the online flight booking segment.

The combined formidable entity will host under its umbrella some of the leading travel
brands of the country including MMT, Goibibo, RedBus, Ryde and Rightstay, which
together processed over 34 million transactions in FY2016. The combined entity (with
MakeMyTrip, goibibo, redBus,
Ryde and Rightstay under its
umbrella) would have made
34.1 million total transactions in
2015-16, 9.7 million air
transactions, 6.6 million hotel
transactions and 17.5 million
bus transactions. Of the
transactions, 45 percent are on
mobile. Additionally, the
merged entity also claims to
have a total of 80,500 hotels
across the two platforms, with
gross room bookings of 50,000
room nights per day.

Merger Timeline

Stakeholder Reactions

The deal has been executed fairly smoothly, with no major roadblocks. The stock
market reaction has been positive, with a surge of 45%, for MMT, listed on NASDAQ on
the night of the deal announcement. SAIF Partners and CTrip have already given the
deal a green signal.

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The founders are very excited with what the two groups can bring to the table. There's a
common belief in both sides that the market has just really started to open up,
especially when it comes to non-air (segment).

Incumbents like Yatra and Cleartrip will face heat out of this merger as they will have a
hard time competing with the combined entity on both the supply and consumer sides.
Aloke Bajpai, CEO & co-founder, ixigo, says it is a win-win situation for all the four
companies MakeMyTrip, Naspers, Tencent and ibibo. Sidharth Gupta, co-founder,
Treebo Group of Hotels, concurs and says, this consolidation will bring higher efficiency
to the overall travel ecosystem including the suppliers and customers on these
platforms.

Financial & Regulatory Constraints

Morgan Stanley is acting as exclusive financial advisors, and Latham and Watkins, S&R
Associates and Appleby are acting as legal advisors to MakeMyTrip. While, Goldman
Sachs is acting as exclusive financial advisor to ibibo and Naspers, while Cravath,
Swaine & Moore, Trilegal and BLC Roberts are acting as legal advisors.

The regulatory approval will be from the Competition Commission of India. These are
effectively the two largest OTAs in India, especially when it comes to air travel. They
filed for approval with the CCI within 30 days and were granted the same in January
2017. Overall marketshare is immaterial when it comes to bus and hotels, and the
combined entity will be single digits in terms of marketshare. In case of air, it would be
in the 20% mark.

CCI is concerned with two things: Pricing Power and Market Share. Pricing power is
nothing but getting an undue amount pricing power from the consolidation, which isnt
the case here. In air ticketing, even though they potentially hold the largest share,
pricing is still done by the airlines, and theyre only resellers, with at most a convenience
fee. The same applies to hotels and chains.
The other thing that CCI looks at is market share. The size of the travel market in India
is about $30 billion. So even for the entire combined company, they dont hold more
than a 10% of the overall market share.

Valuation using DCF

The valuation exercise was undertaken to estimate the intrinsic value of GoIbibo and
then ascertain what premium, if any, MakeMyTrip paid while valuing the deal at 4800
crores. GoIbibo has been operational for 4 years and is a private company with
substantial negative earnings. Hence, we looked at the macro story surrounding the
OTA industry. Some key macro numbers we kept in our mind while forecasting were:

Market Size is $67 Billion

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 CAGR for OTA industry for 2016-20 is 23%
Best Margins in the Hotels business: GoIbibo leading player
Online Air Bookings CAGR 14% for 2016-20
80% transactions on mobile: in line with increasing smartphone penetration
GoIbibo seems to be following the MakeMyTrip journey even if we discount the different
business weights both have. GoIbibo is in a position where MMYT was 5-7 years back
just before its IPO in 2010. MMYT story along with the macro projections provided us a
benchmark to follow while we forecasted the next 10 year numbers for GoIbibo.

Key Forecast Assumptions

Revenue Growth: The firm has been scaling quickly and is a leading player in the OTA
industry. This is reflected in supernatural average revenue growth rate of above 125%
since it started operations. The revenue growth has declined as expected in the past
couple of years but still revenue is doubling every year. We expect the revenue growth
to remain strong albeit decreasing with each year.

The CAGR for OTA industry for 2016-20 is 23% & coupled with strong mobile presence
will help a growing player like GoIbibo command above average revenue growth. We
project the firm to retain strong albeit declining revenue growth of above 50% for the
next 5 years. We can expect the revenue growth to converge with the economy growth
rate by 2026 (5% terminal year revenue growth accounting for premium given to OTA
industry even in terminal year calculations).

Normalised EBIT Margin: The company has been saddled with high service & employee
benefit costs since its operations has commenced. This has led to high operational
losses (margins ~- 45-50%). The EBIT Margin has been steadily improving but remains
negative. The macro story, the timelines of other OTA space companies and kicking in
of economies of scale in the future suggest that EBIT margins for GoIbibo will continue
to improve.

We have forecasted EBOT margins in tune of what most valuation analysts do for a fast
growing start-up. We give a speed supplement to the previous year margin and this
speed keeps tapering in the future. By year 7 (FY2022-23) we expect EBIT Margin to
turn green (MMYT margin has been around ~2% in the last year). In the terminal year
we forecast 9.4% EBIT Margin.

Free Cash Flow to the Firm: For an online service company as expected, the net
working capital is negative and it will remain negative. We have based our numbers on
the historically improving days receivables & payables and that of the industry.
FCFF will remain negative till FY2022-23 after which it will keep growing as
reinvestment tapers and operational efficiency kicks in.

Cost of Capital: Since there were no listed OTA players in Indian capital markets and
the acquirer MMYT being NASDAQ listed, we felt deriving Cost of Capital for a US
based investor and adjusting for the country risk & risk of failure was the right approach.

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Cost of Equity: We took US 5-year T-Bill rate of 1.95%. The Equity Risk Premium of
5.90% was calculated by calculating arithmetic average of equity risk premium of
NASDAQ. The target debt-equity weights were taken of MMYT in the CAPM model.

Calculation of Beta required taking average Betas of listed OTA players in the US
[market beta as MMYT investors were assumed to be diversified], de-levering and then
re-levering them by the target debt-equity weights.

Average Beta 1.236

Beta Unlevered 0.815
GoIbibo levered Beta 2.208

Cost of Debt: As GoIbibo didnt have any public debt rating, we decided to calculate
cost of debt based on synthetic rating using Interest Coverage Ratio.

For a loss making non-financial small cap U.S. firm, the synthetic rating gave a
default spread of 12.05%
Adding this to the risk free rate, we got Cost of Debt as 14%

WACC

Marginal tax rate of 33%

Target Debt-Equity ratio (2.63) weights
WACC calculated 11.9%
Adjusted for Country Risk Premium of 3.13%
We decided to use 15% (accounting for high WACC for a young, operationally loss
making firm) for the next 5 years while calculating Present Value of cash flows after
which we used 12% (industry average WACC).

Terminal Value: Long Term growth Rate was assumed to be 1.5% for India in the
terminal year assuming India would grow at the rate a developed economy grows right
now.

Total PV of CFs -1260.68504

PV of terminal value 4899.294283
Total Enterprise Value 3638.609243

Cash and cash 94.42

equivalents
Total debt 1,030.63

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 Equity Value 2,702.40
Number of shares 83.0523365
Price per share 32.53847909

Sensitivity Analysis of Enterprise Value was based on varying WACC from 12% to 17%
(considering the fact equity might be diluted in the future which is costly & company is
already highly leveraged) and Long Term Growth rate from 1% to 3.5%.

Long Term Growth Rate

3638.61 1% 1.50% 2% 2.50% 3% 3.50%
12% 3306.93 3552.66 3822.97 4121.72 4453.68 4824.69
Discount 13% 3336.29 3582.02 3852.33 4151.08 4483.04 4854.05
Rate
14% 3364.93 3610.66 3880.97 4179.73 4511.68 4882.69
15% 3392.88 3638.61 3908.92 4207.67 4539.63 4910.64
16% 3420.15 3665.89 3936.19 4234.95 4566.91 4937.91
17% 3446.78 3692.52 3962.82 4261.58 4593.54 4964.54

Relative Valuation

We could not perform relative valuation by comparing peer set companies as Ibibo is in
online travel service sector and no peer company is listed in India. We found listed US
firms in online travel space which was not our comparable geography. To resolve this,
we identified comparable transactions in the M&A space where domestic and inbound
transactions happening in online travel services were considered. Some of the M&A
transactions are listed below:

Acquirer Target Deal Date Industry Revenue Company

amount Multiple Value
TUI Le passage $29.09 Jun- Travel 4.03 432.14 Cr
to India M 14 agency

Balmer Lawrie Vacation $3.2 M Feb- Travel 0.13 INR 19.84

Exotica 14 Agency Cr
Naspers Redbus $100 M Jun- Online 14.07 INR 51.08
13 services Cr
(Travel-
Bus
Tickets)

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Ramkrishna Globe Forex $2.82 Dec- Travel 1.91 INR 8.06
Forgings and Travels M 12 Services Cr

Yatra Online TravelGuru $19.7 Jun- Online 5.46 INR 19.85

M 12 services Cr
(Travel)
Explolanka Akquasun $ 1M May- Travel 0.35 INR 43.20
Holdings Holidays 12 Services Cr
India

PE Firm Thomas $180 M May- Travel 2.14 INR

Cook 12 Agency 440.14 Cr
Cox & Kings HolidayBreak $523 M Jul- Education 0.69 INR
India 11 Travel 3335.07
Cr

Out of the listed transactions, deals worth less than $5 M were removed because they
were very small compared to the MMYT-Ibibo which was estimated to be around $720
M. Choice of multiple was again constrained because in many deals number of
transactions in a year, which is a driver in online travel services segment, was not
available.

We rejected EV/EBITDA multiple because most of these companies are private and
were making losses since their inception. So EBITDA would not have captured the true
value in case of young growth companies such as start-ups. Finally, we selected
EV/sales (Revenue multiple) for arriving at the value. Based on the calculations, mean
of revenue multiple came to be 5.28 but we picked median value because there were
large variations in the revenue multiple. Median value came to be 4.03. Goibibos gross
revenue in 2016 was INR 855.46 Cr. Multiplying Gross revenue with the median value
of EV/Sales, we got the enterprise value of INR 3472.63 Cr for Ibibo.

MMYT-Ibibo deal size was estimated from $1.8 Billion valuation of the combined entity.
Deal was coming around $720 million which is roughly INR 4800 Cr in Indian currency.
According to our calculations, MMYT investors have paid a control premium of INR
1327 Cr to Ibibo investors, Nasper and Tancent.

Anticipated and Realized Synergies

The merger follows the playbook of Chinese OTA leader Ctrip. It had consolidated the
Chinese online travel agents space by investing in or acquiring its potential and existing
rivals. The merger gives the group more brands to leverage on. All the three major
brands, MakeMyTrip, GoIbibo and RedBus, would continue their focus. RedBus would

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continue to focus on bus ticketing. MakeMyTrip will stick to Holidays, air ticketing and
the 3-5 star hotel space. And Goibibo will continue with the budget hotel space and their
recently released goCars and goContacts.

The deal will generate more cash on the balance sheets to fight off rivals, while
reducing competition. It will create synergies between the two companies operations,
resource base and inventory base. The deal will cause rationalisation in marketing
spends and hence a lower cost of customer acquisition for other online travel players.
Competition is always better for end consumers as companies fight for acquiring
consumers and incur heavy losses for every transaction. The merger will reduce OTA
price wars (primarily fought between MMT and goibibo), which had been adversely
affecting margins. Thus the merger will have advantages in terms of economies of scale
& scope, cross promotions, market power and filling of gaps in product offerings.

With about a 35% stake in Makemytrip, the South African media and internet
conglomerate will tighten its grip over the Indian market as it already owns online
classifieds portal Olx, a 15% stake in India's largest online retailer and most valued
internet company Flipkart, and a payments business PayU, which acquired Citrus Pay
for $130 million earlier this year. Obvious synergies exist between Makemytrip and the
payments business for processing of transactions.

Naspers has been one of the earliest investors in the Indian internet market, and is
known for making an early bet on Chinese internet major Tencent, which owns
messaging application Wechat. Naspers owns a 34% stake in Tencent, which became
the most valued company in Asia last month when its market capitalisation went past
$250 billion.

Future Outlook

Broadly, the big opportunities are around the new growth areas, and really building a big
solid business and defensive moats around the hotels business, which is the key going
forward, and then jointly taking on the whole mobile opportunity, as we know this
country is actually mobile-first.

MMT will invest in futuristic technologies of ride sharing, accommodation, mobile and
booking solution, data science technology, to improve consumer experience, as it is
unsure when companies such as Google and Facebook will enter the travel business.
Data science will help MMT to differentiate in the commoditised ticketing business. It will
build algorithms that will help the company understand user expectations, needs and
preferences. It will also help MMT reduce its marketing spend. It will tell what is the
kind of money the company should spend in acquiring customers, how much one
should bid for key words, etc.

There is also shared rides that can be interesting to look at. Ibibo has something called
Ryde, the intercity cab service. MMT will identify customers flying from a same town,

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ask them if they want to share a trip to airport, based in location, and offer a cab ride at
one-third the price.

Benchmarking performance against index

170.000
160.000
150.000
140.000
130.000
120.000
110.000
100.000
90.000
80.000
03/10/16 03/11/16 03/12/16 03/01/17 03/02/17

SNP 500 MMYT

Amidst talks about a possible monopoly in the online travel segment post this merger,
global behemoths like Booking.com and others may see larger interest in the Indian
market. With the increasing internet penetration and rise of domestic flyers, the online
travel segment in India will continue to experience hockey stick growth in the next five
years.

The recent macro changes of demonetisation and push towards digital India, has
propelled the growth in OTA space, by reducing cash in the economy, which is major
driver for offline transactions. Reliance Jios 4G move of providing high speed internet
access free of cost, is further helping this cause. Other carriers have also been forced to
reduce the cost of their data and internet offerings. The result can be clearly seen in the
dramatic increase in number of downloads for these apps and also in terms of the
number of active users. Recently, SAIF Partners has exited their entire stake in Make
My Trip with a payout of $400 million, 16X returns on their $25 million investment,
between 2005-2008.

Learnings

The early phase of any sector begins with a lot of bang and enthusiasm in terms of
number of players, but soon realisation also sinks in, and then such M&As happen.
Even while the biggest deal in Indias online travel aggregation space signals a sign of
maturity in the sector, and also provides an exit path to the investors; these equally are
challenging times, as even the large companies are struggling to raise fresh funds. This
only proves that the investors are now looking for profitability and sustainability of
business, making consolidations inevitable.

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This project also highlighted the importance of scale and brand names. On the internet,
B2C brands have inherent value and intrinsic loyalty. Brand names last longer in
customers minds than who owns the company. Another important learning was around
customer acquisition costs that can kill businesses. Discounting only gets customers to
come for the duration of the promotion; important to cultivate customers who would use
service even without promotions. Thus stickiness needs to be created so that customers
have a unique experience, and they yearn for it.

As regards the course, the project helped to appreciate all aspects of mergers and
acquisitions pre (due diligence), during (valuations, regulations) and post (stakeholder
reactions). It was a great opportunity to apply these concepts to a real life example.

References

https://yourstory.com/2016/10/makemytrip-goibibo-merger/
https://skift.com/2016/10/18/the-details-behind-the-merger-of-makemytrip-and-
goibibo-indias-largest-otas/
http://economictimes.indiatimes.com/small-biz/startups/online-travel-portals-
makemytrip-and-ibibo-announce-merger/articleshow/54921415.cms
http://www.hindustantimes.com/business-news/makemytrip-ibibo-to-save-millions-
from-merger/story-5Jv7glakrHSI5uUcRHEMtK.html
http://www.iamwire.com/2016/10/makemytrip-ibibo-groups-merger-travel-
stakeholders/142643
http://www.firstpost.com/business/makemytrip-ibibo-merger-by-december-heres-
how-it-will-impact-the-customers-3060208.html
http://www.yosuccess.com/blog/ibibo-acquisition-by-makemytrip/
http://www.livemint.com/Companies/W9atx25k79RpQcdbRxWuTP/MakeMyTrip-to-
buy-rival-ibibo-Group.html
http://www.forbesindia.com/article/special/makemytripibibo-deal-the-merger-is-
about-two-strong-companies-coming-together/44527/1
http://www.cci.gov.in/sites/default/files/notice_order_summary_doc/C-2016-10-
451.pdf
http://seekingalpha.com/article/4041156-makemytrips-mmyt-ceo-deep-kalra-q3-
2017-results-earnings-call-transcript
http://techcircle.vccircle.com/2016/10/20/naspers-master-of-consolidation-in-indian-
internet-business/
http://economictimes.indiatimes.com/small-biz/money/indian-internet-market-will-
take-time-and-money-to-mature-too-early-to-think-about-exits-naspers-
ceo/articleshow/55024849.cms
https://yourstory.com/2017/02/makemy-trip-receives-8-5-mn-as-ibibo-completes-
the-merger/
http://www.livemint.com/Companies/QrcWnLKjBjNCeGbThh1sxI/CCI-clears-
MakeMyTrip-ibibo-Group-merger.html
Make My Trip Investor Presentation and Press Releases

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APPENDIX
 Company Master Data
CIN U72900DL2012PTC233
Company / LLP Name IBIBO GROUP PRIVATE LI
ROC Code RoC-Delhi
Registration Number 233343
Company Category Company limited by Sh
Company SubCategory Non-govt company
Class of Company Private
Authorised Capital(Rs) 20007557990
Paid up Capital(Rs) 10991093650
Number of Members(Applicable in case of company without 0
Date of Incorporation 23/03/2012
Registered Address F-130.GF, STREET NO.7 PANDAV NAGAR N
Email Id PANKAJ.JAIN@IBIBOGROU
Whether Listed or not Unlisted
Date of last AGM 20/09/2016
Date of Balance Sheet 31/03/2016
Company Status(for efiling) Active

Charges
Assets under charge Charge Amount Date of Creation
2870000 28/06/2013

Directors/Signatory Details
DIN/PAN Name Begin date
00677965 ASHISH KASHYAP 31/03/2014
03258070 PANKAJ JAIN 31/03/2014
03493750 OLIVER MINHO RIPPEL 31/03/2014
05256647 SANJAY BHASIN 31/03/2014
07304038 ROGER CLARK RABALAIS 12/10/2015
CACPK9423P PINKY KANSWAL 27/03/2014
er Data
U72900DL2012PTC233343
IBIBO GROUP PRIVATE LIMITED
RoC-Delhi
233343
Company limited by Shares
Non-govt company
Private
20007557990
10991093650
0
23/03/2012
0.GF, STREET NO.7 PANDAV NAGAR NEW DELHI DL 110091 IN
[email protected]
Unlisted
20/09/2016
31/03/2016
Active

Date of Modification Status

03/07/2014 CLOSED

End date
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-
-
-
-
 Year Mar-13 Mar-14
SOURCES OF FUNDS :
Equity
Share Capital + 1,00,000 1,32,51,35,840
Reserves Total + -23,034.00 -1,17,02,07,973.00
Total Shareholders Funds 76,966.00 15,49,27,867.00

Non-Current Liabilities
Long Term Borrowings 0.00 26,96,37,600.00
Other Long Term Liabilities 3,13,01,865 7,62,34,440
Long Term Provisions 59,94,555 3,30,04,903
Total Non Current Liabilities 3,72,96,420.00 37,88,76,943.00

Current Liabilities
Short Term Borrowings 0.00 0.00
Trade Payables 42,14,23,442.00 50,85,25,906.00
Short Term Provisions 1,19,31,343.00 1,77,00,422.00
Other Current Liabilities 38,80,79,347.00 31,63,05,052.00
Total Current Liabilities 82,14,34,132.00 84,25,31,380.00
Total Equity & Liabilities 85,88,07,518.00 1,37,63,36,190.00

APPLICATION OF FUNDS :
Assets
Non Current Assets
Fixed Assets
Tangible Assets 2,27,02,917.00 3,93,14,541.00
Intangible Assets 26,88,102 25,21,920
Total Fixed Assets 2,53,91,019.00 4,18,36,461.00
Non current Investments 0 23,90,38,562
Long Term Loans & Advances 16,28,79,221 10,74,69,638
Total Non Current Assets 18,82,70,240.00 14,93,06,099.00
Current Assets
Cuurent Investments 0 0
Inventories 0 0
Trade Receivables 19,27,33,975 20,59,68,535
Cash & Bank Balances 31,68,38,319 21,29,73,404
Non Operating Cash 31,05,01,553 20,87,13,936
Operating Cash 63,36,766 42,59,468
Short Term Loans & Advances 15,96,78,234 56,75,80,056
Other Current Assets 12,86,750 14,69,534
Total Current Assets 67,05,37,278 98,79,91,529
Total Assets 85,88,07,518.00 1,13,72,97,628.00
 Mar-15 Mar-16 Classification

5369244720.00 8,30,52,33,650
-4,94,20,73,240.00 -12,42,89,58,498.00
42,71,71,480.00 -4,12,37,24,848.00 CSE

4,75,67,47,100.00 7,66,88,36,500.00 NOL

11,18,82,200 26,02,70,123 NOL
4,04,00,936 1,66,50,643 NOL
4,90,90,30,236.00 7,94,57,57,266.00

0.00 0.00 NOL

78,58,65,418.00 85,95,54,061.00 OL
2,76,32,595.00 5,95,05,078.00 OL
95,57,03,045.00 1,44,14,91,672.00 OL
1,76,92,01,058.00 2,36,05,50,811.00
7,10,54,02,774.00 6,18,25,83,229.00

6,95,95,094.00 8,95,65,627.00 OA
5,27,58,09,661 4,12,37,43,803 OA
5,34,54,04,755.00 4,21,33,09,430.00
0 0 NOA
5,42,46,962 7,43,08,142 NOA
5,39,96,51,717.00 4,28,76,17,572.00

28,70,000 0 NOA
0 0 OA
15,46,78,049 15,82,97,646 OA
95,27,15,916 94,41,82,800
93,36,61,598 92,52,99,144 NOA
1,90,54,318 1,88,83,656 OA
59,05,10,203 79,20,53,029 NOA
49,76,890 4,32,182 OA
1,70,57,51,058 1,89,49,65,657
7,10,54,02,775.00 6,18,25,83,229.00
 Reformulations Mar-13 Mar-14 Mar-15
Operating Assets 22,57,48,510.38 25,35,33,998.08 5,52,69,84,012.32
Operating Liabilities 82,14,34,132.00 84,25,31,380.00 1,76,92,01,058.00
Non-Operating Assets 63,30,59,008 1,12,28,02,192 1,57,84,18,763
Non-Operating Liabilities 3,72,96,420.00 37,88,76,943.00 4,90,90,30,236.00
Net Operating Assets -59,56,85,621.62 -58,89,97,381.92 3,75,77,82,954.32
Net Non-Operating Obligations -59,57,62,587.62 -74,39,25,248.92 3,33,06,11,473.32
Common Shareholder Equity 76,966.00 15,49,27,867.00 42,71,71,480.00
 Mar-16
4,39,09,22,914.00
2,36,05,50,811.00
1,79,16,60,315
7,94,57,57,266.00
2,03,03,72,103.00
6,15,40,96,951.00
-4,12,37,24,848.00
 Year Mar-14 Mar-15 Mar-16
Revenues
Revenue from Operations 1,34,39,24,413 2,95,21,47,801 8,55,46,15,438
Other Income 10,89,88,113 10,05,21,028 6,23,20,492
Total Revenue 1,45,29,12,526 3,05,26,68,829 8,61,69,35,930

Expenses
Service Costs 31,12,05,599 71,10,82,941 2,26,52,39,650
Raw material, WIP costs 0 0 0
Employee Benefit Expenses 68,36,46,093 1,11,43,57,238 1,92,60,69,170
Finance Costs 0 1,02,58,880 61,959
Depreciation & Ammortization 1,64,78,593 1,22,08,09,464 1,22,51,59,711
Other Expenses 1,61,17,67,180 3,76,80,25,573 7,98,72,90,698
Total Expenses 2,62,30,97,465 6,82,45,34,096 13,40,38,21,188

PBIT -1,17,01,84,939 -3,77,18,65,267 -4,78,68,85,258

Tax Expense 0 0 0
Net Income -1,17,01,84,939 -3,77,18,65,267 -4,78,68,85,258

Operating Profit/NOPAT -1,27,91,73,052 -3,86,21,27,415 -4,84,91,43,791

Non Operating Income 10,89,88,113 9,02,62,148 6,22,58,533

Classification

Operating
Non Operating

Operating
Operating
Operating
Non Operating
Operating
Operating
Year Mar-14 Mar-15
Sales 1,34,39,24,413 2,95,21,47,801
Sales Growth 120%

Service Costs 31,12,05,599 71,10,82,941

EBE growth 128%
Gross Profit 1,03,27,18,814 2,24,10,64,860
Gross Profit Margin 76.84% 75.91%

Normalized Operating Profit -1,27,91,73,052 -3,86,21,27,415

Normalized EBIT Margin -95.18% -130.82%

Depreciation 1,42,22,502 4,32,99,076

Amortization 22,56,091 1,17,75,10,388
EBITDA -1,26,26,94,459 -2,64,13,17,951
EBITDA Margin -93.96% -89.47%

Depreciation as a % of PPE 36.18% 62.22%

Capex 16611624.00 30280553.00
Capex as a % of sales 1.24% 1.03%

Trades Receivables 20,59,68,535 15,46,78,049

Inventory 0 0
Other Current Assets 76,23,516 57,29,002
Total Operating Current Assets 21,35,92,051 16,04,07,051

Trades Payable 50,85,25,906.00 78,58,65,418.00

Other Current Liabilities 33,40,05,474.00 98,33,35,640.00
Total Operating Current Liabilities 84,25,31,380.00 1,76,92,01,058.00

Operating Working Capital -62,89,39,328.62 -1,60,87,94,006.92

OWC as a % of sales -46.80% -54.50%

Sales Growth 120%

EBIT Margin -95.18% -130.82%
EBITDA Margin -93.96% -89.47%
OWC to sales -46.80% -54.50%
Receivables Days 55.94 19.12
Inventory Days 0.00 0.00
Payable Days 138.11 97.16
Cash Cycle -82.17 -78.04
Other Current Assets/Sales 0.57% 0.19%
Other Current Liabilities/Sales 24.85% 33.31%

NOPAT -1,27,91,73,052 -3,86,21,27,415

Invested Capital -48,15,27,743.92 3,80,91,59,915.32
Capex/Sales 1.24% 1.03%

Net PPE schedule

Beginning Balance
Capex
Less Depreciation
Ending Balance

Beginning Balance
Capex
Change in OWC
Depreciation
Amortization
Ending Invested Capital
 Mar-16 Mar-17 Mar-18 Mar-19
8,55,46,15,438 14542846245 23268553991 34902830987
190% 70% 60% 50%

2,26,52,39,650 3850907405 6161451848 9242177772

219%
6,28,93,75,788 10691938840 17107102143 25660653215
73.52% 73.52% 73.52% 73.52%

-4,84,91,43,791 -6789259820 -8768645853 -10360742301

-56.68% -46.68% -37.68% -29.68%

4,37,64,102 35826250.8 35075712.92 42773367.66

1,18,13,95,609 0 0 0
-3,62,39,84,080
-42.36%

48.86% 40% 40% 40%

19970533.00 33949906.1 54319849.76 81479774.64
0.23% 0.23% 0.23% 0.23%

15,82,97,646 515539866.2 824863786 1040148585

0 0 0 0
2,40,31,208 50523550.09 63786009.18 104994288
18,23,28,854 566063416.3 888649795.2 1145142873

85,95,54,061.00 2666282835 4266052536 5435046059

1,50,09,96,750.00 3670042450 5901779667 7928279374
2,36,05,50,811.00 6336325285 10167832203 13363325433

-2,17,82,21,956.68 -5770261869 -9279182408 -12218182560

-25.46% -39.68% -39.88% -35.01%

190% 70% 60% 50%

-56.68% -46.68% -37.68% -29.68%
-42.36%
-25.46%
6.75 12.94 12.94 10.88
0.00 0.00 0.00 0.00
36.67 66.92 66.92 56.84
-29.92 -29.92 -29.92 -29.92
0.28% 0.35% 0.27% 0.30%
17.55% 25.24% 25.36% 22.72%

-4,84,91,43,791 -6789259820 -8768645853 -10360742301

2,10,46,80,245.00
 0.23% 0.23% 0.23% 0.23%

8,95,65,627.00 8,76,89,282.30 10,69,33,419.14

33949906.1 54319849.76 81479774.64
35826250.8 35075712.92 42773367.66
8,95,65,627.00 8,76,89,282.30 10,69,33,419.14 14,56,39,826.12

2,10,46,80,245.00
33949906.1 54319849.76 81479774.64
-3,59,20,39,912.00 -3,50,89,20,539.45 -2,93,90,00,151.96
35826250.8 35075712.92 42773367.66
0 0 0
2,10,46,80,245.00 -1,48,92,36,011.70 -3,48,96,76,402.61 -2,90,02,93,744.98
 Mar-20 Mar-21 Mar-22 Mar-23
48863963382 63523152396 76227782876 87661950307
40% 30% 20% 15%

12939048881 16820763545 20184916254 23212653692

35924914501 46702388851 56042866622 64449296615

73.52% 73.52% 73.52% 73.52%

-11084561784 -10598541176 -8144582439 -4106552786

-22.68% -16.68% -10.68% -4.68%

58255930.45 80582232.07 107666615.2 135780700.2

0 0 0 0

40% 40% 40% 40%

114071684.5 148293189.8 177951827.8 204644602
0.23% 0.23% 0.23% 0.23%

1640211973 2092408042 2447101612 2881410077

0 0 0 0
150233916.9 186843167.1 229294745.3 263684058.2
1790445890 2279251209 2676396357 3145094135

8508828378 10866528047 12727915506 14965916549

11941557019 15355117026 18123443844 21151725070
20450385397 26221645073 30851359350 36117641618

-18659939507 -23942393864 -28174962993 -32972547483

-38.19% -37.69% -36.96% -37.61%

40% 30% 20% 15%

-22.68% -16.68% -10.68% -4.68%

12.25 12.02 11.72 12.00

0.00 0.00 0.00 0.00
63.56 62.44 60.94 62.31
-29.92 -29.92 -29.92 -29.92
0.31% 0.29% 0.30% 0.30%
24.44% 24.17% 23.78% 24.13%

-11084561784 -10598541176 -8144582439 -4106552786

 0.23% 0.23% 0.23% 0.23%

14,56,39,826.12 20,14,55,580.17 26,91,66,537.95 33,94,51,750.58

114071684.5 148293189.8 177951827.8 204644602
58255930.45 80582232.07 107666615.2 135780700.2
20,14,55,580.17 26,91,66,537.95 33,94,51,750.58 40,83,15,652.34

114071684.5 148293189.8 177951827.8 204644602

-6,44,17,56,946.57 -5,28,24,54,357.42 -4,23,25,69,128.77 -4,79,75,84,490.21
58255930.45 80582232.07 107666615.2 135780700.2
0 0 0 0
-6,38,59,41,192.52 -5,21,47,43,399.64 -4,16,22,83,916.13 -4,72,87,20,588.45
 Mar-24 Mar-25 Mar-26
96428145338 1.0366E+11 1.08843E+11
10% 8% 5%

25533919061 27448962991 28821411141

70894226276 76211293247 80021857909

73.52% 73.52% 73.52%

304199202.4 4991725673 9867150892

0.32% 4.82% 9.07%

163326260.9 188039381.4 209620525.6

0 0 0

40% 40% 40%

225109062.2 241992241.8 254091853.9
0.23% 0.23% 0.23%

3147136677 3372730550 3557109463

0 0 0
287912748.1 311041598.2 326323970.4
3435049425 3683772148 3883433433

16352903631 17528313940 18481708582

23167373895 24854153343 26169848311
39520277526 42382467284 44651556893

-36085228101 -38698695136 -40768123460

-37.42% -37.33% -37.46%

10% 8% 5%
0.32% 4.82% 9.07%

11.91 11.88 11.93

0.00 0.00 0.00
61.90 61.72 61.98
-29.92 -29.92 -29.92
0.30% 0.30% 0.30%
24.03% 23.98% 24.04%

212939441.7 3494207971 6907005624

 0.23% 0.23% 0.23%

############ 47,00,98,453.59 52,40,51,314.00

225109062.2 241992241.8 254091853.9
163326260.9 188039381.4 209620525.6
############ 52,40,51,314.00 56,85,22,642.34

225109062.2 241992241.8 254091853.9

############ -2,61,34,67,034.73 -2,06,94,28,324.33
163326260.9 188039381.4 209620525.6
0 0 0
############ -2,55,95,14,174.32 -2,02,49,56,995.99
 Year Mar-14 Mar-15
Free Cash Flow Calculation (figures in crores)

Sales 134.39 295.21

EBIT -127.92 -386.21
0.00 0.00
NOPAT -127.92 -386.21
Depreciation 1.42 4.33
Amortization 0.23 117.75
Other Working Capital -62.89 -160.88
Change in OWC -97.99
Capex 1.66 3.03

FCFF -169.17

Key Ratios
Revenue Growth
NOPAT growth
EBIT Margin
EBITDA Margin
OWC to sales
Capex to sales
Invested Capital
ROIC
Reinvestment Rate

WACC 15%
Long Term Growth Rate 1.50%

Terminal Value mid value

PV factor
PV of Cash Flows
Total PV of CFs -1260.68504
PV of terminal value 4899.294283
Total Enterprise Value 3638.609243

Cash and cash equivalents 94.42

Total debt 1,030.63

Equity Value 2,702.40

Number of shares 83.0523365
Price per share 32.53847909
 Mar-16 Mar-17 Mar-18 Mar-19

855.46 1454.28 2326.86 3490.28

-484.91 -678.93 -876.86 -1036.07
0.00 0.00 0.00 0.00
-484.91 -678.93 -876.86 -1036.07
4.38 3.58 3.51 4.28
118.14 0.00 0.00 0.00
-217.82 -577.03 -927.92 -1221.82
-56.94 -359.20 -350.89 -293.90
2.00 3.39 5.43 8.15

-307.45 -319.53 -527.90 -746.04

70.00% 60.00% 50.00%

40.01% 29.15% 18.16%
-46.68% -37.68% -29.68%
-46.44% -37.53% -29.56%
-39.68% -39.88% -35.01%
0.23% 0.23% 0.23%
-1,48,92,36,011.70 -3,48,96,76,402.61 -2,90,02,93,744.98
0.00% 0.00% 0.00%
52.94% 39.80% 27.99%

12%

0.5 1 1.5

1.072380529 1.15 1.233237609

-297.9673237 -459.0408218 -604.9481869

3638.61 1% 1.50%
12% 3306.93 3552.66
Discount
Rate 13% 3336.29 3582.02
14% 3364.93 3610.66
15% 3392.88 3638.61
16% 3420.15 3665.89
17% 3446.78 3692.52
 Mar-20 Mar-21 Mar-22 Mar-23

4886.40 6352.32 7622.78 8766.20

-1108.46 -1059.85 -814.46 -410.66
0.00 0.00 0.00 0.00
-1108.46 -1059.85 -814.46 -410.66
5.83 8.06 10.77 13.58
0.00 0.00 0.00 0.00
-1865.99 -2394.24 -2817.50 -3297.25
-644.18 -528.25 -423.26 -479.76
11.41 14.83 17.80 20.46

-469.86 -538.38 -398.23 62.22

40.00% 30.00% 20.00% 15.00%

6.99% -4.38% -23.15% -49.58%
-22.68% -16.68% -10.68% -4.68%
-22.57% -16.56% -10.54% -4.53%
-38.19% -37.69% -36.96% -37.61%
0.23% 0.23% 0.23% 0.23%
-6,38,59,41,192.52 -5,21,47,43,399.64 -4,16,22,83,916.13 -4,72,87,20,588.45
0.00% 0.00% 0.00% 0.00%
57.61% 49.20% 51.10% 115.15%

2 2.5 3 3.5

1.3225 1.41822325 1.404928 1.486836039

-355.2832206 -379.6156758 -283.4521429 41.84508488

Long Term Growth Rate

2% 2.50% 3% 3.50%
3822.97 4121.72 4453.68 4824.69

3852.33 4151.08 4483.04 4854.05

3880.97 4179.73 4511.68 4882.69
3908.92 4207.67 4539.63 4910.64
3936.19 4234.95 4566.91 4937.91
3962.82 4261.58 4593.54 4964.54
Mar-24 Mar-25 Mar-26

9642.81 10366.03 10884.33 10000000

30.42 499.17 986.72
0.00 0.00 0.00
21.29 349.42 690.70
16.33 18.80 20.96
0.00 0.00 0.00
-3608.52 -3869.87 -4076.81
-311.27 -261.35 -206.94
22.51 24.20 25.41

326.38 605.37 893.20

10.00% 7.50% 5.00%

-105.19% 1540.94% 97.67%
0.32% 4.82% 9.07%
0.48% 5.00% 9.26%
-37.42% -37.33% -37.46%
0.23% 0.23% 0.23%
-3,05,08,97,816.69 -2,55,95,14,174.32 -2,02,49,56,995.99
0.00% 0.00% 0.00%
-1432.75% -73.25% -29.32%

4 4.5 5
8634.230533
1.57351936 1.665256364 1.762341683
207.4227583 363.530942 506.8235465
 Deal Revenue Company
Acquirer Target Date Industry
amount Multiple Value
Le passage Travel
TUI $29.09 M Jun-14 4.03 432.14 Cr
to India agency
Vacation Travel INR 19.84
Balmer Lawrie $3.2 M Feb-14 0.13
Exotica Agency Cr
Online
services
INR 51.08
Naspers Redbus $100 M Jun-13 (Travel- 14.07
Cr
Bus
Tickets)
Globe
Travel INR 8.06
Ramkrishna Forgings Forex and $2.82 M Dec-12 1.91
Services Cr
Travels
Online
INR 19.85
Yatra Online TravelGuru $19.7 M Jun-12 services 5.46
Cr
(Travel)
Akquasun
Travel INR 43.20
Explolanka Holdings Holidays $ 1M May-12 0.35
Services Cr
India
Thomas Travel INR 440.14
PE Firm $180 M May-12 2.14
Cook Agency Cr
HolidayBre Education INR
Cox & Kings India $523 M Jul-11 0.69
ak Travel 3335.07 Cr
S No.
1
2
3
4
5
6
7

Revenue from Operations

Other Income
Total Revenue
 Deal amount in
Acquirer Target Date
million $
Cox & Kings India HolidayBreak 523 Jul-11
PE Firm Thomas Cook 180 May-12
Naspers Redbus 100 Jun-13
TUI Le passage to India 29.09 Jun-14
Yatra Online TravelGuru 19.7 Jun-12
Balmer Lawrie Vacation Exotica 3.2 Feb-14
Globe Forex and
Ramkrishna Forgings 2.82 Dec-12
Travels
Akquasun Holidays
Explolanka Holdings 1 May-12
India

1,34,39,24,413 2,95,21,47,801 8,55,46,15,438 Operating

10,89,88,113 10,05,21,028 6,23,20,492 Non Operating
1452912526 3,05,26,68,829 8616935930
Revenue 8616935930
EV (Mean) 45480187839
EV (Median) 34726251798

Sum of the part

Industry Revenue Multiple Company Value
Education Travel 0.69 INR 3335.07 Cr
Travel Agency 2.14 INR 440.14 Cr
Online services (Travel-
14.07 INR 51.08 Cr
Bus Tickets)
Travel agency 4.03 INR 432.14 Cr
Online services
5.46 INR 19.85 Cr
(Travel)
Travel Agency 0.13 INR 19.84 Cr
Travel Services 1.91 INR 8.06 Cr

Travel Services 0.35 INR 43.20 Cr

Mean 5.28
Median 4.03

861.69 1 Crore = 10000000

4548.02 Cr
3472.63 Cr 40%
3638.61 60%
3572.22
Company
Ctrip
Expedia
MMYT
Priceline
TravelZoo
TripAdvisor
Viad corp
Average
Beta unlevered
GoIbibo beta levered
Equity risk premium
Risk free rate US 5 year t-bills
Cost of equity
Spread
Cost of debt
Marginal tax rate
Cost of capital
Country Risk Premium
Cost of capital
Beta D/E
1.52386 0.6973
0.66433 0.77
1.00832 2.63
1.53907 0.7491
1.33671 0.26
1.99702 0.0608
0.58573 0.4
1.23643 0.79531
0.81508
2.20845
5.90% Arithmetic average of equity risk premium of Nasdaq Index
1.95%
14.98% Using standard CAPM model
14% Default spread calculation based on interest coverage ratio
15.95%
33% US Marginal Tax rate
11.9% WACC in US
3.13% Peration in India thats why country risk premium of India is taken
15.00% WACC in India