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| Thomas Cook's India exit triggers industry frenzy | | As domestic players sense a strategic partner, experts say firm may have to sell forex, travel businesses separately |
| Ruchika Chitravanshi / New Delhi Feb 09, 2012, 01:01 IST |
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The impending exit of Thomas Cook from India has sent ripples across the travel industry. While consumers may not be impacted significantly by the development initiated by the 170-year-old travel company, the pertinent industry can expect much action in the coming days.
The sale of the India business of the British giant is likely to offer an opportunity to several players keen on entering this market. “Getting a strategic partner will bring gravitas to the company. In that, it is a good step,” a senior travel industry executive said today. “However, in the current form, no one will buy the company. Forex and travel will have to be sold separately.”
According to some experts, any existing company would like to build its own brand and there has to be a strategic fit for any company interested in buying Thomas Cook India. “The real value,” according to an analyst, “is in the name of the brand which the customers associate with. Existing players would want to have their own identity.”
Deep Kalra, founder & CEO, MakeMyTrip.com, said, “The reason of sale is that the global company is in financial distress. India business has been doing well for them.” Change in ownership should not impact the working of the company, Kalra added.
According to industry players, management and ownership must delinked to ensure the safety of consumers' interests.
From the customer point of view, there will be enough choice and competition in the market. Given the fragmentation in the market, this will also help in consolidating the business, said Dhruv Shringi, CEO of Yatra.com.
The traditional travel business, like that of 1841-founded Thomas Cook, has also suffered due to the growth of online travel portals. The Peterborough-based company’s India managing director, Madhavan Menon, had said nobody could deny the advent of the online players in this space. “The penetration will only grow as broadband becomes far more viable in India. What you are going to see in the days to come is hybrids,” he told Business Standard earlier last year.
Companies like MakeMyTrip, Yatra.com and Cleartrip have given tough a competition to the brick-and-mortar brands in travel trade, especially in the leisure segment. “Customers have evolved, and companies have to innovate in order to keep up,” said Shringi.
Apart from private equity investor Carlyle and travel company Cox & Kings, other niche players are learnt to be doing their round of enquiries. Travelex of UK, for instance, is keen on just the forex business. And Japan Tourist Bureau is focused on the travel business. Japan Tourism also has a strategic alliance with Thomas Cook in Japan, which may give it a better chance in this market, according to travel industry experts.
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