10 SEPTEMBER 2022 BW BUSINESSWORLD

THE BIG BANG‘REVIVAL’
COVER STORY
T R A V E L H O S P I T A L I T Y N ESSAY
Withthetravelbugbitingmoreand
morepeopleastheCovidfearswane,
thehospitalityandtourismsector
isseeingamajorturnaroundinits
fortunes.Thisisaptlyreflectedin
thestrongfinancialperformance
reportedbyalmostalllistedhotels
By Team BW

52 | BW BUSINESSWORLD | 10 September 2022

he travel and hospitality sector in the country is back in business. After
being hobbled for almost two years by closures, lockdowns, lay-offs and
losses, the hotel industry seems to be jogging back towards profitability.
All key operating metrics like revenue per available room (RevPAR),
average room rate (ARR) and occupancy room rate (ORR) are way
ahead of pre-pandemic levels during the first quarter ended June 30,
2022. With international travel set to pick up further in the second, third

T and fourth quarter, the second half of financial year 2022-23 is looking
much healthier.
“While the occupancy room rate (ORR) remained above pre-pandemic
level throughout Q1FY23 at around 65 per cent (up about 2 percentage
points versus Q1FY20), ARR was on a rise in April (4 per cent)/ May (9
per cent)/ June 2022 (10 per cent) versus April/ May/ June 2019, respectively,” said a Motilal Oswal
Financial Services report dated August 24.

The stock prices of some of the major listed hotels such as The Indian Hotels Company (Taj
Group), Lemon Tree Hotels and Chalet Hotels have risen 50-55 per cent in the first seven months
of 2022 suggesting active investors interest, according to a senior market analyst.

Boosting the recovery trends, the Union Cabinet recently enhanced the corpus of sovereign-guar-
anteed credit facility for small enterprises, Emergency Credit Line Guarantee Scheme (ECLGS),
from Rs 4.5 lakh crore to Rs 5 lakh crore, exclusively for the hospitality sector. “The Cabinet has

Photograph by Unsplash 10 September 2022 | BW BUSINESSWORLD | 53

COVER STORY

T R A V E L H O S P I T A L I T Y N ESSAY

approved the proposal to raise the limit of Emergency

Credit Line Guarantee Scheme for travel, tourism and

hospitality sectors,” Anurag Thakur, Union minister for

Information and Broadcasting said.

Abhishek A Rastogi, Partner, Khaitan & Co said: “The

government’s decision to provide easy credit facility to

the hospitality and tourism sector is timely as demand

for these services are picking up and timely help will

boost growth of the sector, which faced intense head-

winds during the pandemic period.”

The Indian Hotels Company (IHCL), India’s largest

hospitality company, recently reported its consolidated

and standalone financials for the first quarter ending

30 June 2022. It posted a revenue of Rs 1,293 crore in

Q1 FY 2022-23, an increase of 250 per cent over Q1 FY

2021-22. “All brands displayed growth and key metro

cities such as Mumbai, New Delhi and Bengaluru show-

cased RevPAR levels exceeding that of Q1 FY 2019-20.

IHCL generated free cash flow in each month of the first

quarter and remains net cash positive,” the company said

in a statement.

IHCL also signed on 10 new hotels to date in the cur-

rent financial year, with three hotels each under the Taj

and Ginger brands, and two hotels each under the SeleQ-

tions and Vivanta brands. Today, IHCL has a presence in

more than 100 locations. It added its pan-India footprint

with the opening of four new hotels to date in the current

fiscal, including Taj City Centre, New Town, Kolkata;

Anand Kashi by the Ganges,

Rishikesh, IHCL SeleQtions, “MICE destinations such as Goa and Chandigarh
Vivanta Katra, Vaishno Devi

and Ginger Goregaon, Mum-

bai. mental EBITDA to incremental revenue) in Q1 FY23 v/s

Commenting on the Q1 performance Puneet Chhat- Q1 FY20, with Chalet leading the pack (2.4x) followed by

wal, Managing Director & CEO, IHCL said, “IHCL re- EIH, Ober and Lemontre. The RevPAR grew compared

ported its best first quarter in the company’s history. This to the pre-pandemic level across hotels fuelled by better

performance has been boosted by a surge in demand occupancy and ARR with gradual pick-up in leisure and

across markets and segments, with both occupancy and business travel, it said. “The ORR is likely to improve fur-

rates exceeding pre-Covid levels. This has resulted in a ther while ARR would remain resilient in anticipation of

milestone EBITDA margin of 31.3 per cent, which is an a resumption in foreign inbound travel that would con-

improvement of 1,140 bps over Q1 FY 2019-20.” tinue to propel topline,” Motilal Oswal said in the report.

According to HVS Anarock, ORR and ARR have been

Splendid Q1 Performance able to sustain over the pre-pandemic levels in Q1 FY23,

As per an analysis by Motilal Oswal of the performance indicating a strong recovery. The pan-India occupancies

during Q1 FY23 of major hospitality players including in June 2022 reached the 65 per cent mark (3 per cent up

the Indian Hotels (IH), Lemon Tree Hotels (Lemon- from June 2019) along with higher ARR at Rs 5,850 (10

tre), Chalet Hotels (Chalet), EIH, Oberoi Realty (Ober), per cent higher than June 2019). The report added that

Brigade Enterprises (Brgd) and ITC, the occupancies the RevPAR also improved 13 per cent compared to the

surpassed the 65 per cent mark in June with ARR be- pre-pandemic levels for the month.

ing higher by 10 per cent than the June 2019 levels. The “Despite a drop in domestic air traffic by 8 per cent

hospitality basket reported higher flow through (incre- in June 2022 compared to the previous month due to

Photograph by Guvendemir/CANVA 54 | BW BUSINESSWORLD | 10 September 2022

are continuing to show strong growth in average rates”

seasonality, demand in hotels remained buoyant with per cent growth in ORR while its ARR was up 37 per
travellers using other modes of transport. As per the cent. The company’s revenue was also up 5 per cent as-
RBI, FASTag collections per day in June 2022 have seen sisted by increased business travel. The company will in-
a 2 per cent increase to Rs 1,434 million compared to the fuse Rs 700 crore as capex for FY23 with some spill-over
May numbers indicating that more and more travellers in FY24, analysts said. It is said to have started the Delhi
are opting for hotels within drivable destinations,” an Hotel Project that will be connected to the Terminals 3
analyst said. and 4 of the Indira Gandhi International Airport. It may
also be adding one more commercial office in Powai in
For H1 there was an overall growth in ARR, Occupancy the next two to three years.
and RevPAR over Q1 FY20, respectively. The ORR in
Q1 FY23 exceeded the pre-pandemic level in almost all For EIH, the ARR for its domestic hotels (including
hotels, except for Ginger where the ORR declined due managed hotel) was at Rs 11,066 in Q1 FY23, up 14 per
to its strategy to increase room rent. Experts said H1 has cent versus the same period last year while ORR was 72
8,100 rooms in pipeline, representing 40 per cent of total per cent against the last year’s comparable period. While
operational portfolio. the employee costs were down 10 per cent, the repair
and admin expenses increased due to intensified travel
Lemontre saw increased demand for MICE supported activities.
growth. It also saw its ORR improve across Delhi, Hy-
derabad, Bengaluru and Mumbai. Analysts expect the Positive Indicators
ORR to be in the 75-80 per cent range for H2 FY23.
As per the latest report by HVS Anarock, despite a 7 per
The Chalet’s hospitality business also witnessed a 70

Photograph by Anyaberkut/CANVA 10 September 2022 | BW BUSINESSWORLD | 55

COVER STORY

T R A V E L H O S P I T A L I T Y N ESSAY

cent dip in domestic air tra¬vel in July 2022 (seasonal dip) tion in demand by 78 per cent. Our businesses too experi-
compared to the previous month, mainly due to seasonality enced significant losses. In particular, the drop in sched-
and rising airfares, the average rates and RevPAR continue uled departure flights during the pandemic impacted
to be higher than their pre-pandemic levels for the month. the overall business.” However, the firm eventually has
In July 2022, Bengaluru recorded the highest occupancy recovered since March 2022 and witnessed four-fold
rate (74-76 per cent), followed by Pune (73-75 per cent) and growth in corresponding quarters over last year.
Mumbai (72-74 per cent). “MICE destinations such as Goa
and Chandigarh are continuing to show strong growth in Challenges & Caution
average rates, helping the India average,” it said.
Statistics and all possible indicators are currently weigh-
MICE stands for Meetings, Incentives, Conferences & ing in towards recovery, growth and improving business
Exhibitions. Simply put, MICE is everything related to for the hospitality sector that is directly impacted by the
business travel and tourism. And now it is growing too. travel sector. But Mandeep S. Lamba, President – South
Asia, HVS sounds a note of caution. He points to the
Echoing similar sentiments, Sukesh Jain, CEO BI World- rising raw material, labour and borrowing costs due
wide said: “Big conferences, industry events, product to rising interest rates weighing in on hotel operations
launches, music concerts, corporate offsites, dealer meets, and the gross operating profit. “Companies must build
and distributor’s travel incentives – all of them are back in flexibility and the ability to adapt quickly to changing
the business already. Brands are opting for hybrid and on- market conditions,” he states in his commentary on the
ground events, promotions, launching new products and first half recovery in the sector. “Despite the strong in-
having customer events — early signs for the MICE indus- crease in demand, the sector is likely to be impacted by
try to emerge as a prominent contributor at a global level.” global economic headwinds in the year’s second half.
BI Worldwide is a global engagement agency that uses the Many countries are experiencing high inflation because
principles of behavioral economics to produce measurable of a combination of factors such as rising fuel prices,
business results by designing and delivering solutions that ongoing supply disruptions, strong demand, and the
engage employees, channel partners and customers. Russia-Ukraine war.” In short, the sector may be coming
out of the woods, but it has to tread cautiously for some
Pankaj Kumar, Founder & COO, MICE Professionals more quarters, at least. We wish the segment a continued
recalls the lockdown and the post-Covid impact: “Under growth!
the conditions of harsh travel restrictions and protocols
of the pandemic, the MICE business faced a sharp reduc-

Photograph by Photobyphotoboy CANVA 56 | BW BUSINESSWORLD | 10 September 2022



COVER STORY CORPORATE

ThrRouecgohvery
Rediscovery

Scripting a dramatic turnaround from
pandemic-induced lows , India’s largest
online travel company discovered new
business segments, raised $225 million
and posted its biggest profits. How did it
manage to do all that?

By Ashish Sinha

IN THE SECOND QUARTER of 2020, the revenue gow, Co-founder and Group CEO, MMYT, in the spacious
of MakeMyTrip (MMYT), country’s largest player meeting room located on the 19th floor of Epitome, a
in the online travel business, fell as much as 95 per prominent office address in Gurugram to get the fully
cent. Two years later, for the quarter ended June story. Magow walked in at the appointed time with his
30, 2022, it reported an adjusted operating profit trademark smile. After a quick exchange of pleasantries
of $16.5 million, the highest till date, compared to and the initial ‘what’s’ going on in the economy’ discus-
an adjusted operating loss of $8.6 million in the same pe- sion, the conversation moved to the subject of the pan-
riod a year ago. The company attributed this phenomenal demic and how it had impacted MMYT.
growth to ‘strong recovery’ and an ‘increased demand for
travel’. But that is only a part of the story though behind “The impact was severe, and it happened at a time when
the dramatic turnaround of the Nasdaq-listed MMYT our size was big. We had faced multiple headwinds in our
which owns and operates well-known online brands in- early growth years, and one can bounce back fast when the
cluding goibibo.com and redbus.in. size is manageable but when you’re big in size, it is more
challenging and takes more time to control the situation,”
What happened to MMYT after a countrywide lock- Magow said. “Fortunately, it wasn’t an existential crisis for
down came into force in late March 2020? What was us.” With the benefit of hindsight Magow has two words
going on back then when the travel sector virtually came that best describe the pandemic. “It was ‘unpredictable’
to a standstill? This reporter caught up with Rajesh Ma- and unprecedented’. Nobody really had a clue of how the

58 | BW BUSINESSWORLD | 10 September 2022

pandemic would pan out,” he said. EBIT margins can continue to expand.”
The silver lining was that MMYT was sitting with $200
Cost Rationalisation
million on its balance sheet. “We had some comfort,” said Aa a strategic response, MMYT used this opportunity
Magow. “We were very agile -- it didn’t take us months, to evaluate if it needed to fundamentally look at the cost
perhaps few weeks to control the situation. Need of the structure of its business. Essentially, the task at hand was
hour was cost rationalisation given the significant revenue to identify opportunities where the company could tinker
drop in Q1,” he added. its cost structure—from ‘fixed cost’ to ‘variable cost struc-
ture’.
At a tactical level, MMYT immediately reached out to
its partners and negotiated better deals. Given its cred- The company identified a few key areas and doubled
ibility in the marketplace, and its strong relationships, down on that, according to Magow. One was its overall
the partners were very supportive. Citi Research, while customer services unit. Given its consistent increase in
commenting on its financials said, “MMYT is leveraged scale and size over the years, MMYT had outsourced mul-
to travel recovery and consumer sentiment, management tiple services to a bunch of service providers who were
remains strong. New demand and supply-side initiatives supervised by a small internal team. “We were always
should continue to support growth. More important, meaning to crack whip on this cost element, but the pan-
MMYT has demonstrated sustained profitability and demic helped in accelerating the pace of automation,”
given the competitive environment, we think adjusted

10 September 2022 | BW BUSINESSWORLD | 59

COVER STORY CORPORATE

“We
continue

to add
more
properties
on our
platform”

RAJESH MAGOW,
Co-founder and Group CEO,
MakeMyTrip talks to ASHISH SINHA
about the fantastic turnaround,
current and future plans and much

more. Excerpts

stated Magow. From the call centre services to higher level now have over 100 franchise stores,” said Magow. MMYT
of automation for post-sales booking, the MyTrip section also reviewed all other cost heads including marketing
on the website and its mobile application have automated and sales promotion, technology infrastructure costs etc.
every single post-booking help use case. “Customer can to- and found opportunities to optimise them. The real estate
day download e-ticket/voucher, do web-check-in, change costs were also rationalised, he added.
dates of booking, cancel booking and check the refund
status. Effectively, it means our dependency on call cen- Pain & Remedy
tres has reduced dramatically and we are offering better What about the layoffs? How many people lost their jobs
customer experience besides saving costs,” said Magow. because of cost optimisation and cost rationalisation? “We
unfortunately had to right size roughly about 10 per cent
With the travel market moving online in a bigger way, of our workforce (about 350-400 people)…most of them
MMYT, which had set-up 21 stores for holiday packages in were part of our company owned stores. As mentioned
all main cities under a fixed-cost model got converted into earlier, they were all converted to franchisee stores,” said
franchisee stores. “We not only converted but also expand- Magow. Staffers on the international business also lost
ed the number of stores. So instead of 21 owned stores, we

60 | BW BUSINESSWORLD | 10 September 2022

How has the cost of customer tinations we are now seeing growth proved infrastructure, increased
over pre-pandemic levels which per capita income and disposable
acquisition moved and what are helped the overall volumes recov- incomes, and higher propensity to
ery to 87 per cent of pre-pandemic booking travel online.
the challenges due to macroeco- volumes. We continue to add more
properties on our platform. We What is your mission?
nomic headwinds? now have accommodation service Our mission, from a consumer of-
The cost of customer acquisition providers in about 1,900 cities (up fering standpoint, is to be a travel
as a percentage of gross bookings from 1,600 cities earlier). We aim super app. A one-stop-shop for
has come down significantly due to to have accommodation supply in every single travel use case and also
high contribution of direct and or- 2,000 cities before the end fiscal. for any adjacent use cases as well.
ganic traffic and repeat buyers on We also follow an omni-channel
our platforms. Overall, my view is What is your outlook for the next strategy where some of our of-
that as compared to the rest of the ferings are spread offline. An all-
world, India is better placed to deal 5 years? women team of Holiday Experts is
with the current macro headwinds India is still an under-penetrated the force behind our growth within
due to high inflation in the world. travel market with a huge poten- the Holiday Packages segment. In
Some countries in the world might tial of growth. We believe there are FY’22, this team of women free-
slip into recession but we might significant tailwinds supporting lancers helped curate packages for
still end up doing low-single digit robust growth over the medium nearly two lakh travellers – closing
growth. term of next 3-5 years because of the year with highest-ever packag-
multiple reasons. Post pandemic, es sold in over 10 years. Currently,
How was Q1 FY23 for you across there is a permanent shift in how more than 43 per cent of the 850
people perceive travel - with au- holiday experts are mothers and
segments? thentic travel experiences becom- caregivers working from metros.
In our air business, we continue to ing an essential for travellers. Then We are now aiming to expand
maintain our leadership position there is also a secular uptick in the the franchise network as well as
and market share. We are recover- online buying behavior which increase the pool of holiday
ing faster than the market; during bodes very well for us as most seg- experts.
the quarter we witnessed over 90 ments of the Indian travel industry
per cent recovery as compared to have traditionally had low online [email protected];
pre-pandemic levels. In our Ho- penetration. Some of the factors fa- @Ashish_BW
tels, Packages and Alternative Ac- voring these growth trends are im-
commodation business, we wit-
nessed a strong recovery driven by
leisure travel. In many leisure des-

their jobs. “This was clearly the most painful part, but business recovered. It is important to note that we not
this was the right business decision given the Covid situa- only restored, but also released an ex-gratia payment to
tion. We wanted to set the tone from the top. Deep (Kalra, make up for their pay cuts during the crisis time. This
Group Chairman & Chief Mentor) and I went on zero payback was very well received and helped us maintain
salary. The leadership team and other senior folks also the credibility of our already strong employee friendly
took pay-cuts,” recalled Magow who was earlier the chief brand,” said Magow.
financial officer and COO of MMYT.
Getting Future Ready
MMYT tried to soften the blow as much as it could, The most important fallout for MMYT was to become
according to Magow. It took care of impacted employees future ready. It would be fair to say that the two years
for a year so that they could use this time to find another of pandemic were perhaps the most productive years in
suitable opportunity. Besides this, the company also kept terms of delivery of key tech projects including building
its options open—when the business comes back, it would new platforms. The company built a B2B platform called
be able to evaluate its ex-employees for suitable vacancies. myPartner that was conceptualised, developed, and made
“The good part is that we restored all the salaries soon as

10 September 2022 | BW BUSINESSWORLD | 61

COVER STORY CORPORATE

“Onecanbouncebackfastwhenthesizeismanageablebutwhenyou’re
biginsize,itismorechallengingandtakestimetocontrolthesituation”

market-ready during the pandemic. myPartner empow- will soon be going live with hotels. Apart from this, we
ers travel agents across the country with wide selection of have joined hands with PhonePe, and now travellers can
online travel inventory with a promise of helping them to find travel options seeded through MakeMyTrip easily on
enhance their service standards for their customers. “So Google search. We have also integrated our inventory with
far, more than 28,000 travel agents have registered on the HDFC SmartBuy,” said Magow.
platform,” Magow informed.
The company has extended its ground transport strat-
In the past two years, MMYT also launched its ad tech egy via redBus so that the bus commuter could also com-
platform to help its partners and brands within the travel mute through rail or take a cab. MMYT has launched
industry and beyond, target the right and a wider set of independent redRail app to penetrate deeper into India.
customers. This further helped them maximise their ROI For example, it is tested to operate smoothly and book
on MMYT’s platform through relevant audience targeting IRCTC train tickets even in low internet bandwidth areas
tools, Magow said. and on phones with low memory configuration.

It also built a horizontal fintech platform called Trip- MMYT also launched its intercity cab service under the
Money where it offers insurance products, consumer brand name rYde by Redbus. “Our rail and intercity cabs
lending products such as BNPL (Book Now Pay Later) offerings continue to help new set of travellers across the
and forex services. Recently, MMYT acquired Book My country…The pandemic made us think of new initiatives
Forex, India’s largest non-bank online foreign/currency beyond what we had originally envisaged,” Magow added.
exchange marketplace. Through this the company is now
offering a full-suite of forex and other ancillary services Truly, the dramatic turnaround from a period of life-
will be seamlessly integrated with the innovative travel- sapping losses due to the pandemic-induced lockdown
related finance offerings of Trip Money. and travel restrictions to posting record quarterly profits
and raising large amounts of capital, the story of MMYT
On the corporate travel front, it continues to enhance is one of resilience, grit and determination in finding op-
its offerings through myBiz and Quest2Travel. And on the portunities when the going gets tough.
B2B2C front, it launched its affiliate platform. “We are live
on Amazon Pay with our flights and bus inventory, and [email protected]; @Ashish_BW

Photograph by Unsplash 62 | BW BUSINESSWORLD | 10 September 2022

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COVER STORY CORPORATE

“We are
witnessing a golden era

for Indian OTAs”

T hetravelindustryisonarevivalpathandsoisthebusinessoftheonline
travelagencies(OTAs).EaseMyTripthatgotlistedattheBSElastyear
continues to do well at the bourses. PRASHANT PITTI, Co-founder,
EaseMyTrip tells ASHISH SINHA about revival in the travel sector, highlights
ofthefirstquarterandmuchmore.Excerpts:

Do you see a revival in the travel industry? By when do Standard Chartered Bank as a part of our marketing ini-
you expect a complete revival? tiative to offer exciting deals.
We are actually witnessing the golden years for the Indian
OTAs (online travel agencies) as the travel and aviation Tell us about the expansion into international mar-
industry is witnessing an upward growth trajectory. With kets?
the surge in demand and revenge travel, the industry is EaseMyTrip remains true to its words and continues to
reviving sooner than anticipated and is seeing a posi- expand globally. The company cites its entry to the new
tive outlook once again. People are not shying away from market - New Zealand by incorporating a wholly-owned
travelling. That said, our profits itself jumped by 125 per foreign subsidiary, apart from its other subsidiaries in
cent year-on-year and 45.36 per cent month-on-month Philippines, Thailand, Singapore, UAE, UK, and USA. In
in Q1FY23 which shows the recovery is on the right track. this aspect, EaseMyTrip has shown a stellar performance
in its Dubai expansion and marked a cumulative GMV of
Please expand on the first quarter highlights? 70.74 million in just three months.
The company did not only join the elite club of India’s first
100 unicorns last fiscal while remaining bootstrapped We also signed a Memorandum of Understanding
and consistently profitable but has also grown in Gross (MoU) with the Saudi Tourism Authority to boost inbound
Booking Revenue (GBR) this quarter by 366 per cent to tourism. Through this MoU, EaseMyTrip and Saudi Ara-
Rs 1,663.1 crore from Rs 356.7 crore as compared with bia Tourism will explore opportunities to jointly collabo-
Q1FY22 and Profit After Tax (PAT) by Rs 33.7 crore from rate on key initiatives and undertake various activities to
Rs 14.9 crore year-on- year in Q1FY23. In spite of the chal- promote and develop quality tourism experiences in Saudi
lenges that came while the travel and tourism industry is Arabia and expand its presence in the Indian market.
reviving from the pandemic, EaseMyTrip has been instru-
mental in generating remarkable profits and reflecting How are you leveraging the growth? What are your
resilience and strong fundamentals which have earned plans?
the trust of its stakeholders as well. We also launched the EaseMyTrip is focused on expanding its non-air verticals,
first-ever co-branded Credit Card and Debit Card with this fiscal. In the coming quarters, EaseMyTrip aims to
continue its growth across the air ticketing segment and

64 | BW BUSINESSWORLD | 10 September 2022

“EaseMyTrip aims to continue its growth across the air ticketing
segment and expand its hotels and holidays segments too”

expand its hotels and holidays segments too. To continue and became one of the rare, listed consumer internet
the efforts for global expansion, the company will fur- startups in the world to gain unicorn status while being
ther keep looking at profitable markets. Additionally, completely bootstrapped.
the company will also look to develop a FinTech arm, to
provide customers with a ‘Buy Now Pay Later’ option. We What are the current travel trends?
are witnessing the golden era for the Indian OTAs as the With an underlying pent-up travel demand, we are wit-
travel and aviation industry is showing an upward growth nessing a growth in revenge travel. Due to the safety con-
trajectory, with significant support from the government cerns, we expect a rise in demand for unique, unexplored
the industry is set to reach ultimate heights due to the destinations, short weekend getaways and road trips to
growing demand. nearby tourist destinations. Reunion travel is set to be
a major trend this year as people look to reconnect with
How do you look back at the last few months? family by taking a quick getaway trip.
We celebrated our 14th year anniversary through plan-
ning a mega sale which offered lucrative deals to our As an aftermath of the pandemic, there will also be a
customers. We had a successful initial public offer. We rise in the people that are opting for short getaways that
also continue to be one of the best performing stocks offer wellness and self-care activities. This year, travellers
despite industry disruptions. We are one of the very few are set to showcase an increased preference for locations
e-commerce platforms in the world that bootstrapped that have focus on wellness activities that help them re-
itself to the successful IPO. EaseMyTrip joins the elite juvenate, take a break away from the monotony of their
club of India’s first 100 unicorns as the company’s mar- daily lives and lead healthier lives.
ket capitalisation crossed $1 billion in September 2021
[email protected]; @Ashish_BW

10 September 2022 | BW BUSINESSWORLD | 65

IN CONVERSATION

“Data analytics can
play a key role in
business of any size”

L atentViewAnalyticshasprovenitsmettleintheUSaswellasontheglobal
landscapesince2006throughitsdataanalyticssolutions.Asthecompany
turnsitsattentiontowardsIndiatoreduceitsdependenceontheUS
market, Rajan Sethuraman, CEO, LatentView Analytics shares with Rohit
Chintapaligrowthopportunitiesthatdataanalyticscanbringtothefore
forbusinessesandorganisationsinthecountry.Excerpts:

Could you tell us about the true scale of opportunity with Where do you see data analytics making the biggest im-

regard to data analytics in India? pact in India?

There are four sets of opportunities for data and analytics Several government initiatives such as NITI Aayog or the

in India. One of them is, of course, all the work that is being eGovernance bodies of state governments are aimed at using

outsourced to India/ India-based service providers, the bulk data and analytics to improve the penetration and quality of

of which comes from North America and Western Europe. services provided in agriculture, healthcare, and education.

The second set of opportunities comes from outside India Large private sector organisations are also using analytics

aswell,throughthebackoffices/GCCsofMNCs,mostlyFor- to impact innovation, product development, customer ser-

tune500-1,000companies.TheGCCsarenowexecutingthis vice, marketing, procurement, manufacturing, supply chain

workbut,inseveralinstances,ittakessupportfromlarge,mid performance, improve financial controls and governance.

and small service providers in a managed services, project- Some sectors we have been in conversations with include

based or staff augmentation model. commodities trading, airport infrastructure, FMCG, media

The third set of opportunities pertains to MNCs with sub- and entertainment, life sciences, retail, and apparel.

stantial India business (targeting consumers in India). These We are also seeing interest from public sector organisations

organisations need data and analytics sup- in the aerospace and defence sectors. All

port and they look to external partners and Emerging regula- these sectors have tremendous potential
service providers for such support. tions and govern- for leveraging data and analytics to drive
revenue growth.
And finally, the fourth set of oppor-

tunities comes from Indian companies ance mechanisms With such opportunities, are you plan-
and organisations, both from the private around data priva- ning to focus more on India now?
and public sector. Large Indian business

houses are starting to double down on cy and controls will Yes, we have started off with a core team
using data and analytics for driving com- be an important that is now focused on business develop-
petitive advantage and business growth. ment with GCCs, MNCs with India busi-

We are also starting to see public sector aspect of how this ness and Indian private/ public sector or-
organisations increasing focus and spend evolves ganisations. We have about half a dozen
on analytics. conversations in progress, and we see that

66 | BW BUSINESSWORLD | 10 September 2022

our value propositions and capabilities are relevant and resonating well with employees, patients, citizens, service provid-
the target audience. We intend to contextualise our value propositions even ers, governance agencies, intermediaries),
further to ensure that they are helping address the most pertinent challenges machines or processes. Online, digital inter-
and opportunities in an impactful manner. We are also flexible with our en- actions generate a vast amount of granular,
gagement models to get this off to a good start. We expect to have a few closures nuanced data that was not available earlier
in the coming quarters. The intention is to grow the India business to about 10 for analysis and interpretation.
per cent contribution to overall revenue in the next three to four years.
The increasing availability of data and the
How can data and technology insights help the MSMEs grow? associated progress being made in storage
Data analytics and insights can play a significant role irrespective of the size of and computation technologies will enable
the enterprise. However, given volume considerations, MSMEs might be bet- digital representations (such as digital twins
ter off focusing on problems that have a large ticket size, such as manufacturing in the manufacturing space) of a broad spec-
efficiency, inbound/ outbound logistics, sales force effectiveness/ customer trum of interaction environments, further
acquisition costs, rather than initiatives that are likely to give only a marginal fueling the growth of data and analytics.
incremental lift. In the past, we have worked with insurance, retail, and QSR
(quick service restaurants) sectors in India, but these have been with larger Emerging regulations and governance
organisations and not in the MSME space. We have worked with several young mechanisms around data privacy and con-
organisations in the ecommerce, fintech and technology sectors in North trols will be an important aspect of how this
America in the areas of customer behaviour and supply chain analytics. We evolves. An ideal scenario would be one
believe that these value propositions would be relevant in India as well. where data ownership and control reside
not with the technologies (and tech compa-
How do you see metaverse affecting the data pipelines worldwide and nies) that generate the data (or make data
in India? generation possible), but with the people
The metaverse presents the possibility of more and more interactions shifting that the data is about. That would provide
to the online, digital world. These could be human interactions (consumers, a more robust framework for metaverse-
linked technology solutions to progress at
a rapid pace.

10 September 2022 | BW BUSINESSWORLD | 67

BWi

Vinay Pratap Singh,

Business Unit Director -
India & SAARC Countries,

ROXUL ROCKWOOL
Technical Insulation

Pvt. Ltd.

ROCKWOOL Stone
wool is more than a
fire-resistant material
— it is a fire resilient
material, which can
hinder the spread of
fire, decreasing fire-

related damages
and the associated

environmental,
societal and financial

impacts
By Vinay Pratap Singh

Every major city in the world is competing for the attention of tourists,
investors, and businesses. And one way they make an impact on the
global stage is by making architectural statements. The result is a
plethora of stunning buildings, many of which lay claim to being either
the tallest, the most eco-friendly, or offering the greatest ergonomic
efficiency, dominating the skylines of capitals around the globe.
These architectural masterpieces add to the excitement of a city but
they have to conform, of course, to fire regulations and the other safety safeguards that are
required for all buildings. Their complexity, however, presents new challenges for fire safety
rules, and regulations includingthe choice of the right material going in the building fabric.

68 | BW BUSINESSWORLD | 10 September 2022

Fire safety needs to be implemented revision of the current building legislation.

at the highest level What can be done? While fire safety is always one of the
priorities in our country, developing a comprehensive fire
Not only India but the world has been experiencing a series safety strategy can be another step towards a better future.
of building fires that have endangered the lives of citizens, Strict implementation of the state and national bylaws
firefighters, and destroyed heritage monuments like the related to fire safety is also the key. More actions need to be
Glasgow School of Art, Notre Dame de Paris. Though the taken so that Indian citizens can live and work in buildings
number of fires is going down, their impact on society has where fire safety is at its highest level.
increased and there has been a spike in costs too. Moreover,

in the current context where mitigating the effects of climate Develop a comprehensive strategy on
change is the top priority, it is essential to proactively fire protection
address all fire risks.

India is setting the bar with

THE ambitious energy efficiency,
EMERGING the use of non-fossil fuel,
SCIENCE and sustainability policies.
OF FIRE These goals must be achieved
SAFETY while preserving the highest
level of fire safety. Fire costs
(which include losses, the
cost of fire service, insurance
administration, etc.) are about
1 per cent of GDP in most
advanced countries across
the world -- a potentially huge
burden on the country.

Part 4 of the National
Building Code of India and
its committee have taken an
important step by setting
up a platform to exchange
information on fire safety,
and states have recently been
strengthening their fire safety
regulations from time to time
which is very encouraging to
witness.

In my opinion, the next step
is to develop a comprehensive

strategy that could make all the

difference. For example, just

like for road safety, set annual

Thanks to the steps taken by our national bodies like targets for limiting the level of injuries, casualties, and

BIS, BEE to set the guidelines for achieving better energy fire-related costs. Produce reliable and easily comparable

efficiency as well as less CO2 emission which will reduce fire statistics to create a common fire safety vision for India.
the energy consumption and greenhouse gas emissions Promote more research to ensure the safe development

tremendously, if the fire safety standards are also respected. of essential technologies. Investigate existing fire testing

We have not yet forgotten the Grenfell Tower Tragedy and classification methods from time to time to assure they

which is an example of a building that had been renovated reflect realistic fire scenarios and regularly update them.

for energy efficiency purposes but without considering Last but not the least, make stricter regulations in using

fire safety. The fire in June 2017 shook the fire safety completely fire-safe materials and systems for general

community as well as the local government, urging a building applications.

10 September 2022 | BW BUSINESSWORLD | 69

BWi

Choosing the correct material is the key

From a fire’s point of view, the worst-case scenario is to
encounter non-combustible materials on which it cannot
feed. Instead, it is contained and burns itself out. What a fire
prefers, of course, is to be fuelled by materials that reinforce
it, allowing it to grow in intensity and spread rapidly.

Just as there is “no smoke without fire”, to use a well-
known phrase, there’s also no fire without smoke. Inhaling
toxic smoke from fires can be extremely dangerous, and is
the cause of most fire-related casualties.

In sufficiently high concentrations over a long enough
time, toxic smoke creates hazardous health conditions for
people exposed to it and may impede their ability to rescue
themselves from the fire.

One of the prime causes of toxic smoke generation during
any fire accident is the presence of unwanted material which
contributes largely to smoke generation. Non-combustible
insulation materials, such as stone wool, play a crucial role
in improving the fire resistance of buildings, boasting good
thermal properties that help limit the spread of fire and assist
in ensuring a safer environment for all residents.

Various tests have shown that stone wool does not product may be because of its thermal or acoustic properties,
produce significant amounts of toxic smoke and makes a its behaviour in the presence of intense heat or fire is also
negligible contribution to fire toxicity in comparison to other an important consideration for architects, builders, and
insulation materials. installers.

Fire plays a big role in insulation ROCKWOOL stone wool is rated non-combustible,
application having been classified as belonging to Euroclass A1
following EN 13501-1 reaction to fire tests. The fire safety
Let’s talk about some statistics to provide a better overview performance of ROCKWOOL stone wool lasts a lifetime,
of how important will be this portfolio. Over 3.7 million with no maintenance required. ROCKWOOL Stone wool
fires occur in cities worldwide every year and more than is more than a fire-resistant material -- it is a fire resilient
43,000 lives are lost as a result. This, combined with the material, which can hinder the spread of fire, decreasing
fact that fires today develop more than six times faster than fire-related damages and the associated environmental,
in the 1950s, means there are good reasons for looking at societal and financial impacts.
improving fire safety requirements.
Fire resilient materials are key drivers in reducing the
So, whilst the principal reason for choosing an insulation major cost of fires. By minimising the potential impact of
fire, stone wool products also contribute to maintaining a
healthy and safe environment. ROCKWOOL insulation
products truly support fire-resilient societies.

The lesson to be learned from such disasters is that those
responsible for building design, the choice of insulation and
other materials, and their installation, should leave nothing
to chance.

Regardless of the information source, negative stories
abound about the role of insulation materials in fires.
Published stories or reports about positive cases where
fire-safe products have helped to save lives and property are
almost non-existent.

My humble request to all stakeholders out there would
be to choose the material as well as the system wisely after
giving due importance to codes, regulations and testing to
make a fire-safe society.

70 | BW BUSINESSWORLD | 10 September 2022

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IN DEPTH CRYPTO

CRYPTO REVIVAL
ON CARDS IN 2022?

Crypto winter extends into the summer and beyond, but what
can we expect for the rest of 2022? By Rohit Chintapali

72 | BW BUSINESSWORLD | 10 September 2022

A STHECRYPTOindustrylumbersandreels have in bitcoin and the potential of the asset in building wealth
under one problem after another, the value for investors. The analysts were brimming with enough confi-
of bitcoin and other digital currencies has dence to predict bitcoin at $100,000, but then we were faced
depreciated severely in the last few months. with multiple global events that led to uncertainties and then a
The result? The total market capitalisation of prolonged bear cycle,” says Rajagopal Menon, Vice President,
the cryptocurrency market has come down WazirX.
from $3 trillion to $1 trillion. The crash also profoundly im-
pacted the NFT market, which has seen a drastic drop in sales. As the Ukraine-Russia war leaned heavily upon the inter-
national markets, supply chains across the globe were pressed
After peaking at above $60,000 last year in November, and economies across the globe were justifiably petrified with
while the value of gold was sliding in the markets, bitcoin and the idea of an impending downturn. But the crypto market
cryptocurrency — at large — received attention like never seemed to be holding on its own until April. The dip came
before. Six months later, the value of bitcoin plummeted and during mid-May and snowballed into a huge crash with a
went below $18,000 briefly, reminding everyone about the string of events affecting investor sentiments, including the
volatile nature of crypto. collapse of stablecoin Terra, liquidation of hedge fund Three
Arrows Capital, troubles associated with Celsius, and Vauld
“Bitcoin crossing $65,000 was a monumental feat for the pausing withdrawals. The crash has also affected crypto min-
whole ecosystem. It illustrated the confidence that investors ers leading them to sell their hardware. Unfortunately, some
crypto platforms have also been shut down due to the crisis
at hand. Moreover, NFTs worth $40 billion became virtually
worthless with the collapse of the Terra blockchain ecosystem.

More recently, crypto behemoth Coinbase posted an un-
expected quarterly loss as investors stayed away from trading
in crypto due to the worries around risky assets. In fact, the
trading volumes for Coinbase have come down to $217 billion
in the second quarter from $309 billion in Q1 2022, with retail
participation decreasing 68 per cent and institutional trading
dipping 46 per cent.

But what about other crypto platforms? How are they cop-
ing? “Despite the harsh reactions of the market, we as an
organisation ensured we reached out to our entire investor
base through various channels. Our take was and continues
to be plain and simple: Time spent in the market is always
greater than trying to time the market,” says Edul Patel, CEO
and Co-founder, Mudrex.

Being a global crypto investing platform, Mudrex’s inves-
tors are retailers with long-term goals. Patel says that this
meant that they faced no significant challenges. He further
added that Mudrex had witnessed a near-40 per cent jump in
month-on-month investing users on the platform.

Indian Crypto Ecosystem

The Indian central bank’s position around crypto has al-
ways been cynical. In fact, RBI governor Shaktikanta Das
had termed cryptocurrencies to be a clear danger in the 25th
Financial Stability Report (FSR), published earlier this year.
“Anything that derives value based on make-believe, with-
out any underlying, is just speculation under a sophisticated
name,” he said in the report. The FSR went as far as stating
that cryptocurrencies can erode capital account regulation for
developing nations too. But none of these statements made as
big an impact as Finance Minister Nirmala Sitharaman’s re-
marks when she made it clear in Lok Sabha that RBI thought

10 September 2022 | BW BUSINESSWORLD | 73 Photograph by DaLiu

IN DEPTH CRYPTO

that cryptocurrencies should be banned. Crypto Forecast
Problems only seemed to mount for the crypto industry Considering that crypto has been around for just over a dec-
ade, innovation has been aplenty in the space. With time, the
in India as a 30 per cent tax on virtual digital assets was an- crypto ecosystem is bound to attract more institutional money
nounced in Budget 2022, which was followed up by a 1 per and involvement, which will improve the market depth and
cent TDS on all crypto transactions. According to WazirX help ameliorate volatility eventually. Naturally, regulations
and Zebpay’s Trader Sentiment Survey, this has had severe will also play a more significant role in formalising the in-
implications, as 83 per cent of crypto traders revealed that the dustry.
recent tax rules deterred their trading frequency. The survey
also said that 24 per cent of respondents were looking to shift “The regulations levied in India have been baby steps
their trading activities to international exchanges and 29 per toward institutional participation in the crypto exchange,
cent of the respondents traded lesser than the pre-tax period. whereas globally, the conversation around crypto has tried

The Trader Sentiment Sur- to answer more nuanced
vey further showed that 28 per questions about cryptos’
cent of the respondents aged categorization as a Security
between 18 and 35 have sold vs. a Commodity. The SEC
more than 50 per cent of their Chairman, Gary Gensler,
holdings before April 1, 2022. has gone on record to say
that ‘only Bitcoin is a com-
But the crypto industry at modity, every other crypto
large has done better in India is a security.’ There is a need
in comparison to crypto play- for such discourses in India,
ers internationally, which saw along with a sensible taxa-
a number of exchanges shut tion policy,” says Rajagopal
shop and announce bankrupt- Menon.
cies. “The situation abroad has
been created due to investors There also had been
opting for higher returns that some murmurs interna-
also entail much higher risk tionally predicting bitcoin
and staking their crypto as to duck under $15,000, but
collateral with crypto lending for now, it looks unlikely
companies. So far, such com- as crypto markets start to
panies haven’t gathered steam gather steam. “We had never
in India,” reasons Menon. thought of bitcoin reaching
$68,000 in 2021, but it did. We did not expect it to fall to
Fall In NFT Sales $19,000 after hitting its all-time high, but it did. It is pretty
While NFT sales volumes have dipped significantly this year challenging to predict the market as it depends on various
after a huge uptick earlier, the second quarter of 2022 regis- external factors such as demand, supply, regulation, macro-
tered a total of 9,50,000 addresses that transacted with NFTs, economic situations and many more,” says Mudrex’s Patel.
a significant increase from the 6,27,000 addresses in the last While the crypto winter extends into the summer and be-
quarter of the previous year. “The number of participants in yond, it remains to be seen whether crypto markets can get
the sale of NFTs has charted a steady quarterly growth from back to pre-May levels in 2022. Most investors continue to
Q2 of 2020. Central and South Asian countries have recorded remain unaware of the many functions of the various crypto-
the highest levels of web traffic on popular NFT platforms,” currencies and their use cases, which makes it a risky invest-
said Abhay Aggarwal, founder and CEO, Colexian. ment as many who venture into the world of crypto come in
to make a quick buck.
A huge number of NFT projects are still acquiring funding The crash this year and its subsequent effect on crypto ex-
despite the crypto winter. After Nike in 2021, Puma became changes worldwide have prompted governments to spring
the second major brand in the footwear segment to venture into action and build frameworks to protect citizens from
into the world of NFTs recently. More companies are expected making bad choices. But the regulations need to come into
to come on board the NFT bandwagon to leverage their enor- play sooner. Increasing awareness around investing in crypto
mous potential in marketing. Industry experts opine that among people is the need of the hour in times ahead.
NFTs could find their true value with the growth of metaverse
in the near future and crypto winter will have less bearing on [email protected]
those plans.

Photograph by Peshkova 74 | BW BUSINESSWORLD | 10 September 2022

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