Online travel market in India to be worth $13.6 bn by ’21: Praxis
online travel market in India, led by flight and hotel aggregators, is expected to touch $13.6 billion by 2021 and will account for almost 43% of the total travel category in the country, management consulting firm Praxis Global said in a report.
India’s online travel market stood at $5.71 billion in 2015, according to Praxis.
The report said most of the growth in the Indian travel market would come from the increasing penetration of international flight and hotel bookings offered by online portals such as Cleartrip, MakeMyTrip, Yatra, and others. Increase in user demand is also a factor as Indian consumers are expected to devote almost 4% of their wallet spends on travel.
According to Madhur Singhal, managing director of Praxis Global Alliance, combined packages of flight and hotel bookings are a huge hit among Indian consumers. Praxis said in its report that the number of hotel rooms booked in India, both online and offline, touched 11.4 million in 2016, while the number of flights stood at 99.9 million.
“The combination of travel and transportation offers, even those which include airport transfers, as well as holiday packages are growing hugely. Millennial customers are travelling a lot more than before, and they are seeking travel experiences, so they turn to providers who can pitch these packages together,” added Singhal.
Overall, online travel bookings in India, which include both flights and hotels, are estimated to increase at a compound annual growth rate (CAGR) of 16% during the six-year period between 2015 and 2021, according to the report.
Domestic flights will grow at a CAGR of 15%, international flights at 12%, and hotel bookings at 19% during the same time. Online domestic flight bookings accounted for 50% of the overall travel market in 2015, while online hotel bookings accounted for only 27%, the report said.
Interestingly, corporates and businesses contribute to a majority of flight and hotel bookings in India. Corporate, and small and medium enterprises (SMEs) accounted for almost half (49%) of the domestic flight bookings in 2015.