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MakeMyTrip Won by Waiting for Indian Market

NEW YORK (TheStreet) -- Shares of Indian travel agency MakeMyTrip (MMYT) jumped nearly 90% on the company's debut last week, giving it the best performance for an initial public offering in nearly three years. While he enjoyed the jump in his company's share price, CEO Deep Kalra nonetheless says MakeMyTrip is much more than an overnight stock sensation. In his view, it's a business ready to boom now that the Indian traveler has grown more comfortable booking trips online.

Kalra spoke to TheStreet about the company's post-IPO plans and why the online Indian travel business is just getting started.

Why do you think the IPO of MakeMyTrip was so successful?

Kalra: Over the course of the road show we met almost 80 different investors, perhaps more if I include the group luncheons. On the last day when we were totaling all the orders, we saw a staggering demand. Clearly people liked a couple of things about our story. I think investors liked the India story with the consuming class growing so fast. And on the other side, people liked what they saw about the company and that we would be able to maintain our leadership position as the market really opens up. I think the combination of the two clicked with the investors.

How did MakeMyTrip get started?

Kalra: I was working with GE Capital (GE) heading up new businesses for their consumer businesses, looking at new areas for distribution including the internet. I was completely mesmerized by the medium, like a lot of us. I also believed this is the perfect platform to do your own thing, and I guess I had that entrepreneurial dream hidden in me somewhere. A clinical evaluation told me that a couple of businesses would do well, and one of them was online travel. The other was online stockbroker.

How big can this market grow to be?

Kalra: The total India travel and tourism market is expected to be over $110 billion in the next 10 years. If you look at the online piece of that, the penetration is 10% right now. But today the penetration in the U.S. is about 60%. I see no reason over the next decade that over half of the $110 billion won't move online, so I think it's a pretty good market.

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