India is the most dynamic and fast growing online travel market in the APAC region. The online travel market in India has witnessed tremendous growth and is attracting large number of national and international players. Private equity players have made huge investments in the online travel agency (OTA) segment in the past two years. The report begins with the overview of the online travel market, including market size, growth and market share of key segments. It provides overview of industry value chain and commission structure of online travel agencies. An analysis of drivers explain factors contributing to the growth of online travel market based on increasing internet users, growth in low-cost carriers and secure payment mechanisms. The key challenges discussed are low margins, high operating costs, and poor internet and credit card penetration. The keys trends identified include shift in competition from air to non-air segment, growing m-commerce platform and offline counters, entry of meta search engines, travelogues and booming religious tourism. Competitive landscape identifies the major players and provides details of their revenues, market share and brief business description including financials. The report also covers the details of the private equity investments and other key developments in the industry.

1. Online Travel Industry - India
June 2009

2. Executive Summary
Online travel market valued at USD X bn in 2008; Expected to reach USD Y bn by 2011
Online airline ticket booking share is more than x%
Market
Online Travel Agency (OTA) is the most sort after segment by the private equity players with
investments worth USD xx mn in the past two years
Drivers: Challenges:
LE
– Proliferation of internet – Low margins & high operating costs
Drivers & – Growth in low-cost carriers – Poor internet and credit card penetration
P
Challenges – Secure payment mechanisms
– Indian Railways online portal
Trends S M
Competition in online ticket booking is moving away from air to non-air segments
A
Online travel going mobile: changing e-travel to m-travel
OTAs looking for offline counters leveraging on their brand value
Meta search engine is the latest innovation in online travel
Religious travel is becoming a hot segment in online travel
Emerging travel information portals backed by OTAs
Online travel industry will see consolidation in the coming years owing to stiff competition
OTA GDS Meta search engine
• Makemytrip • Amadeus • IXIGO
Competition
• Yatra • Galelio • Ezeego1
• Cleartrip • Abacus • Zoomtra
ONLINE TRAVEL INDUSTRY – INDIA.PPT 2

3. •Market Overview
•Drivers & Challenges
•Trends
•Competition
•PE Investments
•Key Developments
ONLINE TRAVEL INDUSTRY – INDIA.PPT 3

4. Online travel is a fast emerging business segment in India
attracting enormous investments from private equity players
Overview Market Size & Growth
•Online travel market in India valued at USD X
USD bn
bn in 2008 Z
6 x%
•Online travel bookings are x% of the total USD 5 Y
Y bn travel market in India
LE
4 X
•Investments worth USD xx mn made in the 3 W
P
Online Travel Agency (OTA) space in past two 2
1
years
Online Market Share by Channel
2005 SAM 2008
0
2008
Online Travel Penetration
%
2009E 2010E 2011E
E
z% 25
y% z% 20
15
y% D
x% 10
x% C
B
5 A
Supplier Website
0
Traditional Travel Agents (Via Suppliers)
2005 2006 2007 2008 2010E
Online Travel Agents
Source: DNA interview with Scott Blume, APAC Head, Travelocity, Nov 2008; Web Analytics India “Online Travel industry in India”, Jun 2008; Livemint interview with Vish A.
Viswanathan, vice-president, business development, at Sabre Holdings, the parent company of Travelocity, Oct 2007; Expedia news artciles; PhocusWright:
ONLINE TRAVEL INDUSTRY – INDIA.PPT 4

5. Airline ticket booking contributes to more than x% of the online
travel market in India
Online Travel
Ticket Bookings Hotel Reservations Car Rentals Tour Packages
Air
PLE
Non – Air
(Train & Bus)
Overview
SA
• Non-air ticket booking segment is growing fast with
M Online Travel Market Share (2008)
Buses/Cars
the entry of Indian Railways in online space Hotels
Z%
(www.irctc.co.in) and many OTAs providing online Y%
bus ticket
• Large number of hotels have online portals for Rail x%
booking their inventory
• Demand for tour packages have increased both
among domestic and international tourists
W%
Flights
Source: Press Articles; Study by PhocusWright
ONLINE TRAVEL INDUSTRY – INDIA.PPT 5

6. Drivers & Challenges
Drivers
Challenges
Proliferation of Internet
Low Margins & High Operating Costs
Growth in Low-Cost Carriers Poor Internet and Credit Card
Penetration
Secure Payment Mechanisms
Indian Railways Online Portal
ONLINE TRAVEL INDUSTRY – INDIA.PPT 6

7. Trends
Competition in online ticket booking is moving away from air to non-air segments
Online travel going mobile changing e-travel to m-travel
OTAs looking for offline counters leveraging on their brand value
Trends `
Meta search engine is the latest innovation in online travel
Religious travel is becoming a hot segment in online travel
Emerging travel information portals backed by OTAs
ONLINE TRAVEL INDUSTRY – INDIA.PPT 7

8. Online travel industry is over crowded with many new players
entering the market
Overview Revenues* of major OTAs (Mar 2008)
•Online travel market is the most crowded 0 5 10 15 20
arena in the E-commerce segment with many USD mn
Makemytrip x
new players entering this space
•Makemytrip, Yatra, Cleartrip and Travelguru Yatra y
LE
are the leading players in the OTA segment Cleartrip z
More than x%
market share in
•IXIGO, Ezeego1 and Zoomtra are the leading
meta search engines in online travel
MP Travelguru w gross sales
A
•With the existing competition online travel *Revenues through commissions on gross sales
space is sure to see consolidation in the
coming years
•One can expect numerous acquisitions and
buyouts to happen as cash rich international
S GDS market share India
Abacus
WorldSpan
z%
w%
players are entering the market
•Added to that airline companies like SpiceJet,
x% Amadeus
IndiGo and KingFisher in India are coming up
with their own portal Rang7, which will affect y%
Galileo
OTA’s
Source: Travel Biz Monitor interview with David Brett, President (Asia Pacific), Amadeus, Jan 2009; Business Outlook India “Going places “, May 2008
ONLINE TRAVEL INDUSTRY – INDIA.PPT 8

9. Thank you for the attention
The Online Travel report is a part of Research on India’s Tourism Industry Series.
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ONLINE TRAVEL INDUSTRY – INDIA.PPT 9