The initial public offering (IPO) of Le Travenues Technology Ltd, which operates travel booking platform ixigo, made a solid debut on the stock exchanges on Tuesday, in an otherwise weak broader market. The shares of ixigo listed at ₹138.10, a premium of 48.5% over the IPO price of ₹93 apiece.

Post listing, ixigo shares surged as much as 52% to hit a high of ₹141.48 on the NSE, while it touched a high of ₹141 on the BSE. The market capitalisation of the company rose to ₹5,398 crore.

The debut of ixigo was better than Street expectations as the stock was commanding a grey market premium (GMP) of ₹30.50 apiece in the unofficial market, signaling the listing to be around ₹123.5 per share, up 32.8% over the issue price.

The Gurugram-based travel company raised ₹740 crore via IPO, at a total market value of ₹3,603 crore, which received an overwhelming response from investors, with the issue subscribing by 98.10 times. The public issue of the travel aggregator was a combination of a fresh issue of 1.29 crore shares aggregating to Rs 120 crore and an offer for sale of up to 6.67 crore shares worth ₹620 crore by existing shareholder. The price band for the IPO was ₹88-93 per share and the lot size was 161 shares and in multiple thereafter. 

Segment wise, the issue was subscribed 53.95 times in the retail category, while the portion set aside for qualified institutional buyers (QIB) and non-institutional investors (NII) received 106.73 times and 110.25 times bids, respectively. The company had reserved 75% of the issue size for QIBs, 15% for NIIs, and the remaining 10% for retail investors.

Ahead of the IPO, the company raised ₹ 333.04 crore crore from anchor investors by allocating 3.58 crore shares at the upper end of the price band of ₹93 per share, with some major investors participating in the bid including Nomura, Morgan Stanley, HDFC Mutual Fund, and others.

Out of the proposed ₹120 crore equity capital, the company intends to use ₹45 crore for meeting working capital requirements, and ₹25.8 crore for cloud infrastructure and technology. The remaining fund raised from fresh equities will be utilised for inorganic growth through unidentified acquisitions, other strategic initiatives, and general corporate purposes.

Formed in 2007 by Aloke Bajpai and Rajnish Kumar, the batchmates of IIT Kanpur, Ixigo competes with listed companies such as EaseMyTrip and Yatra Online. Backed by SAIF Partners India IV, Peak XV and Micromax, the company owns and operates multiple brands – ixigo flights, ixigo trains, ConfirmTkt and Abhibus, offering flight, train, buses, and hotels services to its customers through separate apps.

As per the DRHP filed with the SEBI, the company posted net profit at ₹23.4 crore for the financial year ended March 31, 2023, against loss of ₹21.09 crore in FY22. Revenue from operations rose by 34.4% to ₹517.57 crore versus ₹384.94 crore in FY22. As of March 31, 2023, the net worth of the company was ₹373.76 crore, while total assets stood at ₹585.93 crore.

The company in its IPO document said that the total Indian travel market has grown at an approximate CAGR of 10% reaching ₹3.90 lakh crore in 2020 when the travel industry was overpowered by the global pandemic. This market size is expected to grow by 7% and reach ₹5.01 lakh crore by 2024.

Axis Capital Limited, DAM Capital Advisors Limited and JM Financial Limited are the book running lead managers to the offer.

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