Walmart-owned Flipkart in talks to buy travel company Cleartrip
Flipkart is in talks to purchase a controlling stake in online travel aggregator Cleartrip, which would help the Walmart-owned e-commerce giant diversify its business and tap the opportunities in the travel space, according to the industry sources.
“The discussions are going on between Flipkart and Cleartrip, whose financial performance was hit due to the Covid-19 pandemic and the restrictions,” said a person familiar with the matter. “On the other hand, Flipkart is eyeing different business such as financial services, insurance and travel and sees it as a good opportunity to acquire travel firms during the pandemic.” Moneycontrol first reported the development.
The move by Flipkart would enable the firm to take on travel companies such as MakeMyTrip, Yatra, Booking.com and EaseMyTrip. Flipkart is expecting to see travel and tourism booming again as the economy starts recovering from the Covid-19 pandemic impact. Flipkart did not respond to the query related to this development.
Besides air travel, Flipkart would also be able to offer train bookings through Cleartrip, which has a partnership with the Indian Railways Catering and Tourism Corporation (IRCTC).
In 2018, Flipkart formed a strategic partnership with MakeMyTrip Limited in the travel services segment. The aim was MakeMyTrip’s multiple brands, including MakeMyTrip, Goibibo and redBus, would leverage the large customer base of Flipkart’s platform to drive online bookings in travel services. In 2019, Flipkart strengthened its travel offering by introducing an enhanced native experience in partnership with Ixigo, a mobile travel platform. The aim was to provide simplified access to quality airfare.
Both the firms came together to solve ever-growing consumer demand and had built a product that is India-first. The travel page on Flipkart’s website is powered by Ixigo.
Last year, Flipkart’s rival Amazon India partnered with ‘Indian Railway Catering and Tourism Corporation (IRCTC), to provide its customers with the facility to book reserved train tickets on Amazon. With this launch, the e-commerce company’s digital payments arm Amazon Pay added another travel category, thereby offering its customers a one-stop-shop for booking flights, bus and train tickets. Incidentally last year, Amazon also partnered with Cleartrip to add a flight-booking option to its payment service Amazon Pay in the country.
Cleartrip reported its revenues for the financial year 2019-20 as Rs 319 crore, a 2 per cent fall since the last financial year. The company further reported a net loss of Rs 14 crore during the same fiscal. This is a 53 per cent decrease from the last financial year, according to financial data accessed by the business intelligence platform, Tofler. The company’s total expenses for the fiscal were reported as Rs 333 crore.
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