BP - CASE STUDY ON MAKE MY TRIP POST COVID-19 PDF

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CASE STUDY ON MAKE MY TRIP POST COVID-19...

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IMPACT OF COVID-19

IMPACT OF COVID-19 ON MMT

INTRO INTRODUCTION DUCTION MakeMyTrip Limited is an Indian online travel company founded in 2000. Headquartered in Gurugram, Haryana, the company provides online travel services including flight tickets, domestic and international holiday packages, hotel reservations, and rail and bus tickets. As of 31 March 2018, they have 14 company-owned travel stores in 14 cities, over 30 franchisee-owned travel stores in 28 cities, and counters in four major airports in India. MakeMyTrip has offices in New York, Singapore, Kuala Lumpur, Phuket, Bangkok, and Dubai.

PRO PRODUCTS: DUCTS:

 MMT is the market leader in OTA which has the highest market share and thus helps the Indian tourism industry in some way.  To understand the scope understand the tourism Sector of India 2

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IMPACT OF COVID-19 ON MMT

INTR INTRODUCTION ODUCTION The Indian tourism and hospitality industry have emerged as one of the key drivers of growth among the services sector in India. Tourism in India has significant potential considering the rich cultural and historical heritage, variety in ecology, terrains and places of natural beauty spread across the country. Tourism is also a potentially large employment generator besides being a significant source of foreign exchange for the country. FEEs during the period January-November 2019 were US$ 26.78 billion registering a growth of 3.7 per cent year-on-year. According to WTTC, India ranked third among 185 countries in terms of travel & tourism’s total contribution to GDP in 2018. India was ranked 34th in the Travel & Tourism Competitiveness Report 2019 published by the World Economic Forum.

Mar Mark ket Siz Size e  India is the most digitally advanced traveller nation in terms of digital tools being used for planning, booking and experiencing a journey, India’s rising middle class and increasing disposable incomes has continued to support the growth of domestic and outbound tourism.  During 2018, foreign tourist arrivals (FTAs) in India stood at 10.56 million, achieving a growth rate of 5.20 per cent year-on-year During JanuaryNovember 2019, Foreign Tourist Arrivals (FTAs) were 96,69,633 with the growth of 3.2 per cent.  During January-November

 The travel & tourism sector in India accounted for 8 per cent of the total employment opportunities generated in the country in 2017, providing employment to around 41.6 million people during the same year.  The number is expected to rise by 2 per cent annum to 52.3 million jobs by 2028.  International hotel chains are increasing their presence in the country, as it will account for around 47 per cent share in the Tourism & Hospitality sector of India by 2020 & 50 per cent by 2022

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2019, a total of 25,51,211 tourist arrived on e-Tourist Visa

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IMPACT OF COVID-19 ON MMT

IMPACT ON TOURISM AND HOSPITALITY INDUSTRY BECAUSE OF COVID-19.

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IMPACT OF COVID-19 ON MMT

INTRO INTRODUCTION DUCTION  The coronavirus pandemic could bargain a devastating hit to the Indian travel and the travel industry, exceptionally with the administration suspending all visas, with the financial effect being evaluated to run into a huge number of crores of rupees. As indicated by industry chamber CII, this is the one of the most exceedingly awful emergencies at any point to hit the Indian the travel industry affecting all its land fragments inbound, outbound and local, practically all travel industry verticals - recreation , experience, legacy, MICE, voyage, corpora.  The whole tourism value chain across hotels, travel agents, tour operations, destinations, restaurants, family entertainment venues and air, land and sea transportation have been hit.  On Indians being advised to refrain from unnecessary travel, as per the CII report almost 28 million plus Indians are estimated to have travelled outside in 2019 and there were almost 1.8 billion domestic tourist footfalls.  The holiday season of Indians those travelling within the country and outside is heavy in April-July, October and December.  The December holiday season of 2019 took an estimated hit of almost 40-50 per cent, the holiday season of April to July 2020 is likely to take a humongous hit which could be as high as 80100 per cent, unless there is positive news of the progression of virus decreasing," the CII assessment report said.  There are advanced cancellations and highly reduced forward booking pipelines for the holiday season. Only corporates are flying and that too only on highly essential same day travel.

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Economical  The government of India has a huge amount of income from the tourism department which has stopped.  The Figure are as follows:

 As we can see the graph there is a decline of $ 3,177 Million to $ 2,557 Million.  The approx. loss stands to 44,92,56,00,000 INR (74.4 RS conversion rate ).

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 This data is the comparison of the current earning with the earning before the virus outbreak.  The decline had started way before the lock down  The Retail part of India is also facing a huge problem due to the decline as the tourist had trend to by local goods.

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BECAUSE OF COVID19.

THE ECONOMICAL IMP IMPACT ACT P PAST AST HIST HISTOR OR ORY Y: Online travel aggregator MakeMyTrip (MMT) has reported revenue of $118 million for the quarter ended September 30, 2019, an increase of 13.8% YoY. The company saw losses of $36.8 million, slightly lower from losses of $47 million in the same quarter last year. Total adjusted revenue increased by 13.1% year-on-year; adjusted operating loss decreased to $19.3 million from $25.4 million YoY.  Adjusted revenue for hotels and packages increased by 1.9% YoY in the quarter ended September 30 to $87.1 million in the quarter ended September 30. Adjusted revenue margin, however, decreased to 22.7% YoY in the quarter ended September 30, from 24.4% in the same quarter last year. Revenue from hotels and packages increased by 4.2% to $46.8 million in the quarter ended September 30. 10

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IMPACT OF COVID-19 ON MMT

Gross bookings increased by 9.6% YoY, driven by 12% increase in the number of hotels room-nights YoY Nearly 7.4 million room nights booked despite lower marketing spend to achieve efficiencies, and seeing weak outbound demand in the traditionally weak second quarter. For international hotel bookings, the room night growth was at about 60%.  Revenue from the air ticketing business increased by 12% YoY to $46 million, while adjusted revenue increased by 16.7% YoY. The company said that the increase in adjusted revenue was due to an increase in gross bookings of 22.4% which was mainly driven by growth in outbound air ticketing business. In the domestic air ticketing business, the company saw a growth of over 7%, which it claimed far outpaced the market’s growth, which was less than 3% during the quarter. Further, our as we continued to focus on driving online penetration in this largely off-line market segment. International air ticketing segment grew by over 36% as a result of using the international inventory build of Ctrip, which owns 49% of MakeMyTrip.  Revenue from bus ticketing business increased by 20.4% YoY to $14.3 million; adjusted revenue increased by 37.4% YoY.

 So seeing the growth rate and the size of MMT we can understand that MMT is currently recurring a loss of $ 39.99 Mil. in just this lock down period.  But due to this the company has its fixed expenses which are recurring in nature and thus the payments for the same has to be done.  MMT has a good option of savings when it comes to the rental part as the GOVT of India has asked the landlords to give extensions / waive off the rental chargers.  But the Chinese company which invested a huge chunk of amount in MMT will not accept the waiver of the it ROI and thus it’s a huge drawback for the company. The Chinese company is CTRIP. 11

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 At present the company if operating at a very minimal scale as many of its operating countries have seal the border and have declared complete locked down.  We need to understand that the international market for MMT is not as huge as the Indian market.

IMP IMPACT ACT ON SUPPL SUPPLY Y CHAIN:  The company has to bear the losses due to supply chain as the services opt by the customers has been cancelled by the government. Due to this MMT has to refund the total amount of money to the customer.  MMT has to refund the total amount including its commission or the convince fee as well.  MMT had to bear with loses by booking holiday packages both overseas and domestic.  It also had to use logistics support for returning of passport the clients.

HR POLICY T TAKEN AKEN PLACE:  Make my trip has launched 'Stays for Saviors’ initiative to provide temporary accommodations at special rates for the medical frontline force fighting COVID-19.  MMT have said every customers who had booked flights, hotels, cabs, holiday packages and got stuck because of covid19 will get 100% refund.  Since govt have allowed booking after 14 th April 2020, so MMT have also given an option to customers if they want to change dates of their trips.  MMT have started work from home for the safety of its employees.  Cut-off in salaries- CEO and co-founder of the company are not being salaried for this month and others 50% cut in compensation.

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PRO PRODUCTION DUCTION AND SALES:  MMT is an OTA (online travel agent). Currently MMT offers a wide range of service which include tickets booking, hotels booking, cabs, packages etc.  Now for the tickets the production is done by the software and the ticket is generated after the payment is received.  Since no flight car, ship, buses, trains are running in lockdown thus there is no sale and production.  But the countries like Malaysia, UAE are not yet into complete lockdown and thus ticket bookings are available there. 

Secondly the packages, tour set ups, making of itinerary and bookings for customers have been stop since people from India cannot travel abroad. And thus a huge loss of $ 20 mil.

 We all know that the month of March to June are the months where people prefer going on a holiday.  MMT for doing all these things charges commission for its services provided and thus the company has been affected as the company cannot take bookings.  Rather the refund provided by MMT is costly for them as they have to refund there convince fee as well.

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PLANING FOR L LOCKDO OCKDO OCKDOWN: WN: 

MMT has made sure that the employees work from home to understand and keep solving the needs and grievances of customers.

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MMT during the lockdown cannot preform any kind of production or supply since all kind of services provided by the company is under disaster act and has be stopped by the central government as well as the government of different countries.

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Whereas the company has got a relief as the government has allowed travel bookings after 14th of April 2020

LESSON LEARNT LEARNT:: 1. That the companies should have a plan for disasters. 2. The company have now understood in a way that employees are the real owners of the company and thus companies needed them that’s why work from home was brought in. 3. Companies now understood the need of sanitizing at work place. 4. The companies also have learnt that they need to have a strong supply chain systems and production systems which should be strong enough to handle these kind of situations

LETS PRA PRAY Y GOD THA THAT T CO COVID-19 VID-19 P PASSES ASSES AWA AWAY Y SOON.

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