MakeMyTrip Goes Into an IPO Orbit in the U.S.

After a hiatus of three years, and wounded an Indian IPO markets in the United States this week. Raised MakeMyTrip (MMYT) 70 million. That was a doozy. On the first day of trading, shares climbed 89%. This is the largest increase in a single day in nearly three years.

Made MakeMyTrip was founded in 2000, a key decision five years ago to focus on the United States, India and incoming airline tickets in the market. It was not easy and requires large amounts of investments in infrastructure, technology and trademarks.

But it certainly has paid off. Through www.makemytrip.com, customers can easily search, planning and travel services book. What is more, the statute also includes a hotel and train tickets and bus tickets and so forth.

From 2007-2009, MakeMyTrip was the second most popular site in India, with an average of about 1.7 million visitors per month. Because of the investments, the site is very scalable and can accommodate more traffic than that, with little additional cost.

Like other online ticket brokers, MakeMyTrip uses the Global Distribution System) to facilitate reservations and confirmations. Provider is Amadeus global distribution systems, which charges a fee. Of course, the Commission MakeMyTrip levies that exceed this.

This is why it is important to focus on net income, which amounted to 83.5 million dollars in the last fiscal year, an increase of 22%.

Issues for investors to consider

A study from McKinsey & Company estimates that the Indian middle class will expand from 50 million in 2005 to 583 million large in 2025. In light of this, it seems inevitable that online travel companies such as MakeMyTrip will grow in a big cat. Discretionary income and more the further spread of the Internet seems likely as a result.

Look at how well the American Airlines on the Internet can lead the business office, and especially Priceline (PCLN), which sports a market value of 14.4 billion dollars.

However, MakeMyTrip and presents some issues for investors. The company will face greater competition, and some can come from players such as Priceline. Also, the evaluation is in the nose bleed levels, with trading of securities in more than eight times trailing earnings. Therefore, investors may want to wait a moment for this company to a level more reasonable before jumping in it.