Competition Commission of India (CCI) on Wednesday imposed a total fine of over Rs 392 crore on online travel services provider MakeMyTrip, Goibibo and hotel services provider Oyo for unfair trade practices. The commission, in its 131-page order, said that MakeMyTrip-Goibibo (MMT-Go) has been fined Rs 223.48 crore and Oyo Rs 168.88 crore. MMT-GO was alleged to have enforced price parity in its agreements with hotel partners. Under such agreements, hotel partners are not allowed to offer their rooms on any other platform or on their online portal at a price lower than what they are offering on the platform of these two entities.
Instructions to modify the agreement with hotel operators
Along with imposing the fine, the CCI asked MMT-GO to revise its agreements with hotel operators. An allegation was also made that MMT favored OYO over its platform, thereby hindering market access for other companies. The regulator had in October 2019 ordered a detailed probe into the matter. MakeMyTrip (MMT) acquired ibibo group holding in 2017 which operates under the name goibibo bonds.
Oyo’s market valuation falls to $6.5 billion
Hospitality and travel technology company OYO, which is preparing to launch its initial public offering (IPO), has lost its valuation in the private market to around $6.5 billion. In the week ended September 30 this year, around 1.23 lakh shares of the company were sold in the private market as against 1.6 lakh shares sold in the previous week. A source said investors started selling shares of Oyo after its largest investor SoftBank slashed the hospitality platform’s valuation by 20 per cent to $2.7 billion in its books. Due to this, after Oyo’s financial report came out last month, the company’s share price in the private market had increased to Rs 94 per share. However, investors started selling shares after SoftBank’s undervalued Oyo, which saw its valuation fall nearly 13 per cent to Rs 81 per share. OYO had last month told the stock exchanges that it received revenue of Rs 1,459.32 crore for the three-month period ended June 30, 2022. The company had filed draft documents with SEBI in October last year to raise Rs 8,430 crore through IPO.
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