India’s largest travel portal MakeMyTrip disappointed the street by recording a loss in second quarter ended September 30, 2010 even though the revenues grew significantly.
In its first publicly announced financial results after the company went in for an IPO in Nasdaq, MakemyTrip recorded a loss of $1.8 million in 2Q2011 compared to a profit of $0.02 million in the same quarter the previous year. Following the results, shares fell 26.55% to $28.02 from $38.15 as revenues missed analysts’ expectations. The company had gone public in Nasdaq in August this year at $14 a share. The shares had zoomed to above $40 commanding market cap of over $1 billion.
The street was also worried about a disclosed service tax demand by the authorities, which the company plans to argue against. Since the amount is not available to public and there is uncertainty, the market has reacted sharply. However, in India, it’s common service tax authorities call companies for assessment and make demands for service taxes.
As for financials, the company’s revenues grew 40.5% year over year to $23.8 million in 2Q2011 from $17 million in second quarter last year. The revenue less service cost increased by $3.8 million to $12.9 million, representing a growth of 41.5% year over year.
The gross bookings for air ticketing and hotels and packages combined increased by $51.2 million to $156 million, a growth of 48.8% year on year. The net revenue margin for air ticketing was 7.4% and hotels & packages net revenue margin was 11.9%.
Hotels and Packages
Other Operating Expenses
Fiscal Year 2011 Outlook
Deep Kalra, CEO and Founder, said: “We believe MakeMyTrip is well positioned to capture the long term growth in travel services that comes with the growing Indian economy and its middle class. The expected roll out of broadband Internet services throughout the country will only continue to drive the popularity of e-commerce which will benefit online travel companies like MakeMyTrip.”
Full results can be viewed .