Bhanu Chopra and Megha Chopra are the company promoters.
Promoters have 67.29% shareholding in the company and the remaining shares are held by public shareholders including Wagner and Avataar.
Investor Wagner will offload 17.1 m equity shares through offer for sale (OFS), while promoters Bhanu Chopra, Megha Chopra, and Usha Chopra will sell 5.5 m equity shares.
Category-wise reserved portion
Up to 75% of the net issue is reserved for qualified institutional buyers (QIBs), whereas non-institutional buyers will have 15% shares allocated for them.
Retail portion has been fixed at 10% of the net offer. Retail investors can invest a minimum of ₹14,875 for one lot, and their maximum investment would be ₹193,375 for 13 lots.
The company has also allocated equity shares worth ₹50 m for its eligible employees and will give a discount of ₹40 per share for eligible employees bidding in the portion reserved for them.
Utilisation of the net proceeds
As per the red herring prospectus (RHP), RateGain will now use ₹852.6 m to repay a loan taken by RateGain UK from Silicon Valley Bank. In the DRHP, this expense was pegged at ₹864 m.
Further, the company will use ₹252 m of the proceeds in deferred consideration for the DHISCO acquisition from 2018. This consideration was earlier at ₹262 m.
It will also look to invest ₹800 m towards strategic investments, acquisitions and inorganic growth and ₹500 m for technology innovation, artificial intelligence (AI), and other organic growth initiatives.
Earlier, the company had proposed to allocate ₹433 m for purchase of certain capital equipment for its data centre and this proposed expense has now been brought down to ₹407.7 m.
A brief insight of the company
RateGain Travel Technologies is one of the leading distribution technology companies globally and the largest software as a service provider in the travel and hospitality industry in India.
The firm offers travel and hospitality services across different verticals like hotels, airlines, online travel agents, meta-search companies, package providers, car rentals, cruises, and ferries.
The business provides inter-connected products to manage the revenue creation value chain leveraging big data capabilities and integration and over the period, expanded product portfolio to AI and machine learning capabilities.
RateGain Travel delivers travel and hospitality technology solutions through the SaaS platform through 3 business units.
1. Data as a Service (DaaS)
3. Marketing Technology (MarTech)
RateGain Travel Technologies' customer base
As of 30 June 2021, it had over 1,400 clients, including eight global Fortune 500 companies.
Its customers include Six Continents Hotels, InterContinental Hotels Group firm, luxury hotel chain Kessler Collection, Lemon Tree Hotels, and Oyo Hotels and Homes Private Limited.
It caters to 1,186 large and mid-size hotel chains, 104 travel partners, such as airlines, car rentals and cruise companies, and over 144 distribution partners such as online travel agency (OTAs) like GroupOn and distribution companies like Sabre GLBL Inc. as clients in over 110 countries.
Quick look at the company financials
The company posted a consolidated loss of ₹285.7 m in financial year 2021, against loss of ₹201 m in previous year. Revenue in the same year declined to ₹2.5 bn from ₹4 bn.
In the five-month period ended August 2021, the loss stood at ₹83.3 m against loss of ₹78.5 m in the same period last fiscal.
However, revenue from operations increased to ₹1.3 bn during the same period, from ₹978.9 m year on year (YoY).
The Covid-19 pandemic adversely affected the company's business, financial condition, and results of operations.
According to the travel tech's prospectus, disruptions in the operations of the firm's customers and prospective customers, including as a result of travel restrictions and business shutdowns, uncertainty in the financial markets or other harm to their business and financial performance, leading to reduction in information technology budgets, delayed purchasing decisions, longer sales cycles, extended payment terms, the timing of payments, ability to pay for services and solutions on time or at all and postponed or cancelled projects, all of these have negatively impacted the company’s business and operating results, including sales and cash flows.
Strong customer base with 1,434 customers including 8 Global Fortune 500 Companies as of 30 June 2021.