The Golden Goose
Once upon a time in the crowded, cut-throat world of online travel, three brothers—Nishant, Rikant, and Prashant Pitti—had a brilliantly simple idea. While every other travel website was adding extra charges called "convenience fees" at the last step of booking a flight, they decided to do the opposite. In 2008, they launched EaseMyTrip (EMT) with a powerful, game-changing promise: what you see is what you pay. No hidden fees. Ever.
This wasn't just a marketing trick; it was their entire business philosophy. They believed that by being honest and transparent, they could win customers for life. And for a long time, it worked like magic.
The "No Fee" Business Model
Here’s how their clever plan was supposed to work:
Convenience Fee
Attract tons of customers by offering the lowest final price.
High Volume
Make small profits (commissions from airlines) on a huge number of bookings.
Cross-Sell Add-ons
Sell extras like "Free Cancellation," hotels, and holiday packages to increase profit per customer.
They also built a massive, hidden army: a network of thousands of small travel agents across India who used EMT's system. This meant they got a huge number of bookings without spending a fortune on advertising. When they finally went public in 2021, investors were thrilled. Here was a tech company that was actually profitable, careful with its money, and loved by its customers. It seemed like the perfect story.
The Cracks Appear
But stories can change. The years 2024 and 2025 were when the fairy tale began to unravel. The very things that made EMT a hero started to become its weaknesses. A series of problems, both inside and outside the company, came together to create a perfect storm.
Problem #1: The Leaky Bucket
The first and biggest problem was with the money. While the company kept announcing that more and more people were booking hotels and trains, their profits vanished into thin air.
What's a P&L Statement? Think of it as a company's report card. It shows all the money that came in (Revenue) and all the money that went out (Expenses). What's left at the end is the Profit or Loss.
EaseMyTrip's Profit Problem Explained
Revenue Pours In
Money from flight commissions, hotel bookings, etc.
PROFIT LEAKING!
💧 💧 💧
The Business
Leak 1: "Free" Cancellation
Paying out refunds for cancelled flights was incredibly expensive.
Leak 2: High Service Costs
Customer support for changes and refunds required a large, costly team.
Leak 3: New Ventures
Money was being spent on new, unproven ideas that weren't making a profit yet.
Strategy Drift - Spreading Resources Too Thin
At the exact moment their core business needed attention, EMT started chasing new, unrelated ideas. This is called "Strategy Drift." Instead of focusing their money and talented people on fixing the leaks, they started spending on risky new ventures. It was like trying to fill a leaky bucket by opening up more taps.
Medical Tourism
Helping people travel for medical procedures. A complex field requiring medical partnerships and expertise they didn't have.
Study-Abroad Services
A highly competitive market dominated by specialized consultants. It was a major distraction.
Offline Stores
Opening physical franchise stores was expensive and went against their lean, online-first model.
UAE Expansion
Expanding to a new country is costly and requires deep local knowledge, pulling focus away from fixing problems in their main market, India.
The result was a disaster you can see over time. The chart below shows EMT's revenue (the money coming in) versus their profit (what's left). Notice how after 2024, the revenue bar stays high, but the profit line completely collapses. The bucket was leaking faster than they could fill it.
Where Did the Money Go? A Side-by-Side Look
The Healthy Year (FY24)
Total Revenue
₹482 Cr
Expenses:
👤 Employee Costs: ₹65 Cr (13.5%)
📢 Ad & Promotion: ₹175 Cr (36.3%)
💳 Payment Gateway: ₹25 Cr (5.2%)
💸 Service & Cancellation: ₹93 Cr (19.3%)
...what's left is Profit (PAT)
₹119 Cr
Profit Margin: 24.7%
The Crisis Year (FY26 Projection)
Total Revenue
₹456 Cr
Expenses:
👤 Employee Costs: ₹70 Cr (15.4%)
📢 Ad & Promotion: ₹150 Cr (32.9%)
💳 Payment Gateway: ₹24 Cr (5.3%)
💸 Service & Cancellation: ₹202 Cr (44.2%)
...what's left is Profit (PAT)
₹4 Cr
Profit Margin: 0.9%
*FY18 Net Profit not available.
Problem #2: The Warning Signs Investors Couldn't Ignore
Investors are like detectives, constantly searching for clues about a company's health. In 2024-25, they found several glaring ones that turned anxiety into outright panic. These weren't just small issues; they were fundamental questions about trust, focus, and stability.
Clue #1: The Promoter Exodus
The founders began selling large blocks of their shares and pledging others for personal loans.
Large Share Sales
Signaled a potential lack of confidence in the company's future from the very people who built it.
Share Pledging
Created a risk of forced selling if the stock price fell, adding to market instability.
"Market analysts have raised concerns over the recent block deals and pledging of shares...the timing...has made investors nervous." - Business Standard, Feb 2025
Clue #2: The Cloud of Uncertainty
Headlines repeatedly linked a co-founder to an external regulatory probe, damaging the company's reputation by association.
Negative Headlines
Even if the company wasn't involved, the constant negative press created a perception of risk.
Governance Questions
Raised questions for investors about the company's internal controls and leadership judgement.
"Investors are adopting a wait-and-watch approach, factoring in a higher governance risk." - The Economic Times, June 2025
Clue #3: Fighting PR Wars
Instead of fixing internal problems, the company focused on external battles, spending energy on social media campaigns and political stances.
Attacking Rivals
Launched a high-decibel social media war against MakeMyTrip over its "China link," creating noise but not revenue.
Geopolitical Grandstanding
Aggressively joined boycott campaigns (e.g., #BoycottMaldives), winning nationalist praise but making the business model reactive and unpredictable.
Clue #4: Captain Off the Bridge
The sudden resignation of a co-founder and MD during a crisis signaled deep trouble.
August 29, 2025
Co-founder Prashant Pitti resigns as MD, creating a leadership vacuum.
Confidence Shattered
The ultimate red flag for investors, suggesting a lack of a clear path forward.
"Prashant Pitti's surprise resignation...has sent shockwaves through Dalal Street...creating a leadership vacuum at a critical juncture." - Mint, Aug 30, 2025
A Deeper Look at the PR Wars
An army fighting a war on too many fronts is bound to lose. While its profits were collapsing, EMT's leadership seemed more focused on public relations battles than on fixing the business. This manifested in two major ways:
The MakeMyTrip "China Link" Spat
A co-founder launched a high-profile, aggressive campaign on social media against rival MakeMyTrip. The core of the attack was that MMT had significant investment from Ctrip (now Trip.com Group), a major Chinese travel company. During periods of heightened geopolitical tension between India and China, this is a very sensitive issue. The campaign, using hashtags and pointed posts, aimed to position EMT as the "truly Indian" choice.
The Geopolitical Stances
EMT frequently and loudly inserted itself into international political disputes. When a diplomatic row erupted between India and the Maldives, EMT was one of the first and most vocal companies to announce a suspension of all flight and hotel bookings to the island nation, promoting domestic destinations instead under the banner of #ChaloLakshadweep. They took similar stances during tensions with Turkey and Canada.
This combination of red flags created a full-blown crisis of confidence. The chart below shows how the stock price reacted to this continuous stream of bad news.
The World Moves On
A company's problems don't happen in a bubble. While EaseMyTrip was busy putting out fires, its competitors were calmly building bigger, stronger houses. They weren't distracted. They were executing their plans with discipline.
MakeMyTrip: The Disciplined Leader
The market leader, MakeMyTrip, was a picture of stability. They focused on what worked, posting record bookings and steady profits. They grew in profitable areas like bus tickets and international holidays, showing everyone what a mature, well-run travel company looks like.
ixigo: The Focused Challenger
The clever newcomer, ixigo, didn't try to fight everywhere at once. They picked one battlefield—train tickets—and completely dominated it, capturing almost half the market. With a strong base of loyal train travellers, they then began to carefully expand into flights and buses.
The chart below gives a simple scorecard. While EMT was struggling, its rivals were scoring high on all the things that matter: growth, profit, and disciplined operations.
The Path to Redemption
So, is this the end of the story for EaseMyTrip? Not necessarily. But getting back on track requires going back to basics and learning from the painful mistakes of 2024-25. It's about less talk and more action.
The 5-Step Recovery Plan
The Three Golden Rules for Founders
"Free" will cost you.
A great offer must still make business sense. Always understand the real cost of your promises.
The market hates surprises.
Your investors are your partners. Be honest and open with them, especially when things are tough.
Focus is your superpower.
It is better to be the king of one thing than a jack-of-all-trades. Win your main battle before starting new wars.
