NEW DELHI: Recently disclosed earnings data for India's travel and hospitality service providers highlights the damage that the pandemic is wrecking on the vast sector. Thomas Cook India's (TCIL) consolidated FY21 loss, for instance, ballooned to Rs 416 crore from Rs 69 crore in FY20.
"The performance was impacted due to the pandemic," said the company, whose operations range from providing leisure and corporate travel packages to running properties such as Sterling Holiday Resorts.
However, TCIL added that it continues to maintain short-term liquidity and balance sheet strength "given the uncertain environment" with a continued focus on cash conservation. The company boosted its cash reserves by securing fresh funding of Rs 435.7 crore from its parent Fairbridge Capital (Mauritius) Limited during the year.
Gurugram-based online ticketing giant MakeMyTrip’s (MMT) revenue fell by a whopping 68 per cent year-on-year in FY21 to USD 163 million and it reported a USD 56 million loss during the financial year.
MakeMyTrip is India's largest online travel agency and has an over 50 per cent market share in all the verticals. The company pointed out that the pandemic has severely impacted travel demand by affecting consumers’ sentiment and their willingness to travel.
This caused airlines and hotels in India and around the world to operate at significantly reduced service levels throughout much of calendar year 2020, it added. The Federation of Hotel & Restaurant Associations of India (FHRAI) estimates that the Indian hotel industry has taken a hit of over Rs 1.30 lakh crore in revenue for the fiscal year 2020-21.
Likewise, Hotel Association of India (HAI) said more than 40 per cent of hotels have shut or are on the brink of closure, while 70 per cent of overall jobs are now in danger directly or indirectly. "We currently expect the impact of the second wave on our financial results to be greater in the first quarter of FY22... travel demand has been significantly impacted during April and May 2021," said MMT.
The sector is now pinning its hopes on a relief package from the government.