MakeMyTrip's Deep Kalra, Rajesh Magow to draw 'zero salary' due to COVID-19 impact
Online travel firm MakeMyTrip's top executives Deep Kalra and Rajesh Magow have decided to draw 'zero salary' from April 2020, while the rest of its leadership team will take a reduction of around 50 percent in their compensation amid the COVID-19 outbreak.
Group Executive Chairman Deep Kalra and its Group CEO Rajesh Magow have decided to take 'zero salary' from April 2020 as the company plans to undertake multiple "tough measures" to keep overall expenses at a minimum amid the COVID-19 outbreak.
"On people costs front, both of us will take the lead and take zero salary effective April 2020, while the rest of our leadership team have also offered to take a reduction of approximately 50 percent in their compensation," Kalra and Magow said in a message to company's employees.
The group is reviewing operating costs and plans to undertake multiple tough measures to keep overall expenses at a minimum.
Being an online company, the majority of the costs are variable, however the situation demands that it takes a hard look at all the fixed costs including people costs, the message said.
"The last few weeks have been very tough for all of us with the sudden and sharp spread of COVID-19 in India. Our stellar performance in Q3 2020 was sadly short lived as the travel and tourism sector is one of the worst sectors that have been hit by this pandemic," Kalra and Magow said.
"There has been sharp drop in bookings with spiralling cancellations and the latest restrictions on domestic air/rail/bus travel has brought the industry to a virtual standstill. These are incredibly tough times that we need to navigate through together! Economic experts across the world are predicting it to be a global economic tsunami that will have far reaching implications for the global economy," the message said.
"Therefore, we need to focus on two critical areas (i) safety and well-being of our staff, customers and the society at large, and (ii) minimising the impact to our business from these disruptions," it added.
This means the group will continue to sharply reduce variable costs like advertising, sales promotions and payment gateway costs, along with optimising IT infrastructure and expenses relating to the functioning of our offices and other establishments, they added.
"We will immediately cancel all discretionary spends such as events, trainings, etc. and also suspend brand building expenses during the following quarter," the message said.
They expressed confidence that with all these steps the group would together be able to weather this storm and come out stronger.
"At this time, please do take best care of yourself and your loved ones. Be well," they said in a filing made to the US Securities and Exchange Commission.