Ixigo.com to add 50,000 hotels in its search kitty

The travel search engine also in talks to raise additional private equity funding

Ixigo.com, a leading travel search engine, is expanding footprints across the country, by adding 50,000 hotels to its kitty. In India, about 12,000 hotels are available for online booking and most of them are in metros and tier I cities. With this addition, Ixigo plans to enter tier 2, 3 cities and rural villages.

As part of expansion, Ixigo is looking for another fresh round of fundraising and in discussions with various private equity investors. At present, private equity investor SAIF Partners holds 50% stake in Ixigo, while MakeMyTrip holds about 20% and promoters hold 30% stake.

"We want to create a large market place for small hotels across the country. We have already a database of 22,000 hotels and we are expanding it into 50,000 in next 6 months. All destinations - tourist, religious and offbeat destinations where homestays are available plenty, will be covered soon," said Aloke Bajpai, CEO, Ixigo.

According to various studies, 30% of consumers search online for hotels with a rate of below Rs 800/ night while 50% search for a range of Rs 800-2500.

"We have noticed that in tier 2 and 3 cities, only 20% hotels are available for online booking. We will make surprise visits at the hotels and upload the real pictures for the bookings. So, the quality of the hotels are also expected to improve when they will list online," Bajpai added.

According to him, hotel owners can avoid the 20% commissions which give to travel agents, if they are listed in online marketing & distribution platforms. At Ixigo.com, basic listing is free while premium listings will be charged.

Ixigo said it had 4 million monthly users on the site and expected to cross 5 million by end 2014. About 20-30% revenue of Ixigo comes from hospitality space and which is expected to grow to 50% by 2015. Ixigo was valued at $25 million three years ago when SAIF and MakeMyTrip acquired stake while the latest valuation is not yet known.

The high penetration of smartphones in India makes the online booking easier for consumers. In India, there are around 74 million smartphone users currently and this is slated to grow to 440 million by 2020.

"Larger screen size, high-definition resolution, and easier access to wireless Internet are some of the features that enable a fulfilling mobile browsing experience. Smartphones currently account for nearly 20% of the mobile handsets market. However, over the next five years, the share of smartphones is estimated to increase to over 80% of the total mobile phone market, making Internet access more broad-based," said a recent report by Technopak Advisors.