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MakeMyTrip-ibibo merger: More power to consumers; rivals better watch out

Their negotiating power and better economies of scale will allow them to indulge in aggressive pricing.

Ajay Modi  |  New Delhi 

makeMYtrip
Source: www.makemytrip

Online portal ibibo’s merger with market leader will create pricing challenges for players like and Cleartrip. The combined entity’s improved negotiating power and better economies of scale will allow them to indulge in aggressive pricing.

Ankur Bhatia, executive director of Bird Group, which has interests in hospitality and aviation, said a consolidation is always better for the industry. “The two entities together become a large buying house and can negotiate for better margins due to sheer volumes. This will allow them to offer better prices to consumers. The deal also means will remain the market leader for a very long time,” said Bhatia.

Indian market has been growing, both domestically and internationall . There has been a series of deals in the online space this year. Indian market offers a great growth potential and large foreign capital is flowing in as overseas investors look to benefit from this growth.  

In January, Nasdaq-listed had raised $180 million from Chinese major Ctrip to grow the hotel business. In February, ibibo secured an investment of $250 million from Naspers, the South African internet and media company, now one of its main shareholders, along with Chinese internet firm Tencent. In July, announced a reverse merger deal with Nasdaq-listed American company Terrapin 3 Acquisition Corporation (TRTL) that valued the Indian entity at $218 million. will list on Nasdaq. 

ALSO READ: boards ibibo, to lead market

The online market in India is still evolving with the rapid penetration of smart phones and low cost of data. In the air ticketing space, almost half of the market has moved to online. However, in the hotel booking only 15 per cent of the branded hotel booking is estimated to happen online. Moreover, the hotel booking space typically offers a much higher margin of 10-12 per cent against airline ticketing margin of 5-6 per cent. This is where the next fight for market share will take place. The combined entity has a close to 50 per cent share in online hotel booking space and are a dominant player in air ticket segment.

With ibibo, will improve economies of scale. The combined entity can optimise on the use of infrastructure like call centres and kiosks and bring down the cost of operations. 

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MakeMyTrip-ibibo merger: More power to consumers; rivals better watch out

Their negotiating power and better economies of scale will allow them to indulge in aggressive pricing.

Their negotiating power and better economies of scale will allow them to indulge in aggressive pricing.
Online portal ibibo’s merger with market leader will create pricing challenges for players like and Cleartrip. The combined entity’s improved negotiating power and better economies of scale will allow them to indulge in aggressive pricing.

Ankur Bhatia, executive director of Bird Group, which has interests in hospitality and aviation, said a consolidation is always better for the industry. “The two entities together become a large buying house and can negotiate for better margins due to sheer volumes. This will allow them to offer better prices to consumers. The deal also means will remain the market leader for a very long time,” said Bhatia.

Indian market has been growing, both domestically and internationall . There has been a series of deals in the online space this year. Indian market offers a great growth potential and large foreign capital is flowing in as overseas investors look to benefit from this growth.  

In January, Nasdaq-listed had raised $180 million from Chinese major Ctrip to grow the hotel business. In February, ibibo secured an investment of $250 million from Naspers, the South African internet and media company, now one of its main shareholders, along with Chinese internet firm Tencent. In July, announced a reverse merger deal with Nasdaq-listed American company Terrapin 3 Acquisition Corporation (TRTL) that valued the Indian entity at $218 million. will list on Nasdaq. 

ALSO READ: boards ibibo, to lead market

The online market in India is still evolving with the rapid penetration of smart phones and low cost of data. In the air ticketing space, almost half of the market has moved to online. However, in the hotel booking only 15 per cent of the branded hotel booking is estimated to happen online. Moreover, the hotel booking space typically offers a much higher margin of 10-12 per cent against airline ticketing margin of 5-6 per cent. This is where the next fight for market share will take place. The combined entity has a close to 50 per cent share in online hotel booking space and are a dominant player in air ticket segment.

With ibibo, will improve economies of scale. The combined entity can optimise on the use of infrastructure like call centres and kiosks and bring down the cost of operations. 

image
Business Standard
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MakeMyTrip-ibibo merger: More power to consumers; rivals better watch out

Their negotiating power and better economies of scale will allow them to indulge in aggressive pricing.

Online portal ibibo’s merger with market leader will create pricing challenges for players like and Cleartrip. The combined entity’s improved negotiating power and better economies of scale will allow them to indulge in aggressive pricing.

Ankur Bhatia, executive director of Bird Group, which has interests in hospitality and aviation, said a consolidation is always better for the industry. “The two entities together become a large buying house and can negotiate for better margins due to sheer volumes. This will allow them to offer better prices to consumers. The deal also means will remain the market leader for a very long time,” said Bhatia.

Indian market has been growing, both domestically and internationall . There has been a series of deals in the online space this year. Indian market offers a great growth potential and large foreign capital is flowing in as overseas investors look to benefit from this growth.  

In January, Nasdaq-listed had raised $180 million from Chinese major Ctrip to grow the hotel business. In February, ibibo secured an investment of $250 million from Naspers, the South African internet and media company, now one of its main shareholders, along with Chinese internet firm Tencent. In July, announced a reverse merger deal with Nasdaq-listed American company Terrapin 3 Acquisition Corporation (TRTL) that valued the Indian entity at $218 million. will list on Nasdaq. 

ALSO READ: boards ibibo, to lead market

The online market in India is still evolving with the rapid penetration of smart phones and low cost of data. In the air ticketing space, almost half of the market has moved to online. However, in the hotel booking only 15 per cent of the branded hotel booking is estimated to happen online. Moreover, the hotel booking space typically offers a much higher margin of 10-12 per cent against airline ticketing margin of 5-6 per cent. This is where the next fight for market share will take place. The combined entity has a close to 50 per cent share in online hotel booking space and are a dominant player in air ticket segment.

With ibibo, will improve economies of scale. The combined entity can optimise on the use of infrastructure like call centres and kiosks and bring down the cost of operations. 

image
Business Standard
177 22

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