Moneycontrol
Feb 16, 2017 06:44 PM IST | Source: Moneycontrol.com

SAIF Partners makes $400 mn on its investment in MakeMyTrip

Since the Nasdaq-listed company‘s stock price surged by over 50 percent following its merger with the Ibibo Group, the VC firm shed its balance 11 percent in the company.

SAIF Partners makes $400 mn on its investment in MakeMyTrip

Moneycontrol Bureau


SAIF Partners has sold its entire 11 percent stake in MakeMyTrip and the transactions are estimated to be largest cash exit in India’s venture capital industry, The Economic Times reported.


Since the Nasdaq-listed company’s stock price surged by over 50 percent following its merger with the Ibibo Group, the VC firm shed its balance 11 percent in the company.


SAIF is estimated to have earned more than USD 400 million on its investments in MakeMyTrip, which 16X of the investment. The venture capital firm invested about USD 25 million in travel company’s series B and series C round of funding between 2005 and 2008 and owned 41 percent stake in the company when it debuted in Nasdaq in 2010.


This is an exceptional investment exit as venture capital firms in India are facing difficulties to generate cash from the investment as only few of the companies have opted for IPO of their shares, a highly preferred exit route for investors.


“You need to be super-patient to get returns in India. For a significant period, the MakeMyTrip stock was below its IPO price,” Rutvik Joshi, director at venture capital firm Inventus told ET.


Founded in 2000 by Deep Kalra, Keyur Joshi and Rajesh Magow, MakeMyTrip picked up 76.6 percent stake in Le Travenues Technology for USD 18.5 million.


While SAIF Partners has been selling its MakeMyTrip stock, mutual funds and hedge funds including Wasatch Advisors, Capital World Investors, Janus Capital and Ruane, Cunniff & Goldfarb have been buying into the company.


In 2016, exit for venture-backed companies added up to USD 1.5 billion across 64 deals as compared to USD 1.56 billion across 66 deals in 2015. Total investments added up to USD 2.2 billion last year, down from USD 4.9 billion in 2015.


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