Travel and hospitality technology services provider Rategain Travel Technologies Ltd has filed draft papers for its proposed initial public offering (IPO) with markets regulator Sebi, joining the long queue of companies that are aiming to go public amid buoyant primary market activity.
The company plans to raise Rs 400 crore through the IPO, which will be deployed towards repayment of loan availed by RateGain UK, its subsidiary, from Silicon Valley Bank; payment of deferred consideration for acquisition of DHISCO; strategic investments, acquisitions, and inorganic growth; investment in technology innovation, artificial intelligence; purchase of certain capital equipment for its data center.
Apart from the fresh capital to be raised through the IPO, the company’s existing private equity investor TA Associates will sell 17.1 million shares in the offer, and other individual shareholders will sell 5.49 million shares. TA Associates holds 22.8 per cent stake in the company currently and is selling a significant portion of its shares in the IPO. The promoters of the company hold over 50 per cent stake in the company.
Rategain offers a suite of inter-connected products that manage the revenue creation value chain for travel and hospitality companies by data analytics and integration with other technology platforms helping these companies acquire more guests, retain them via personalized guest experiences and maximize their margins.
As of 30 June, the company served over 1,400 customers including eight global Fortune 500 companies. Its customers include Six Continents Hotels, Inc., an InterContinental Hotels Group company; Kessler Collection, a luxury hotel chain; Lemon Tree Hotels Ltd and Oyo Hotels and Homes Pvt Ltd. It also counts 1,186 large and mid-size hotel chains, 104 travel partners including airlines, car rental companies and large cruise companies and over 144 distribution partners including OTAs such as GroupOn and distribution companies such as Sabre GLBL Inc., in over 110 countries as its customers, as of June 30, 2021.
Rategain’s revenue fell to Rs 250.7 crore in FY21 due to the impact of covid-19 on the travel industry. It reported a revenue of Rs 398.7 crore in the previous year. It reported a loss of Rs 27.8 crore in FY21, increasing from a loss of Rs 12.8 crore in the previous fiscal. The company had reported a profit of Rs 11.5 crore in FY19 on a revenue of Rs 261.5 crore.
Investment banks Kotak Mahindra Capital, IIFL and Nomura are advising Rategain on the IPO.