March 17，Indian media disclosure，188bet game received a “life extension” fund。SVF India Holdings and RA Hospitality Holdings, two major investment entities under SoftBank Vision Fund，Injected 8 into 188bet game parent company Oravel Stays.USD 0.7 billion。

Oravel Stays at 52643 per share. premium，Issuance of a total of 15,325 Series F Mandatory Convertible Preference Shares (CCCPS) to two entities。Among them，SVF India Holdings with 5.Subscribed 9626 shares at a price of US>245_word_end<.7 billion，RA Hospitality Holdings subscribes for 5,699 shares for US0 million。After allotment，On a fully diluted basis，The two will hold 188bet game 46 respectively.42% and 23.74% of shares。

188bet game spokesperson confirmed the above information to India's "Economic Times"。The spokesperson said that the funds will be used for the company’s sustainable growth、Operations、Management training and improving customer experience。

Recent，188bet game is plagued by negative news，There have been reports of large-scale layoffs in China、Executive Shuffle、Hotel contract termination and other news。According to Tech Planet report，188bet game China’s layoff rate is as high as 80%，The business scope has been reduced from the original 11 regions to 7，48 Hubs (area centers) reduced to 30，And merge and manage many cities。

Many employees gathered and rushed to 188bet game China Shanghai Headquarters to ask for wages，They gathered in the lobby holding A4 papers with white background saying "188bet game returns my hard-earned money"，There are also many hotel owners who are owed the minimum guarantee amount。

Indian media pointed out，188bet game is like the defeated Germany in World War II，Facing the difficult "Battle of Bulger"，Launch a final desperate counterattack。

188bet game’s “Battle of Bulger”

From a valuation perspective，188bet game is the second largest startup company in India，If something goes wrong with it，That will have a shock to the financing of all startups in India。

For 188bet game，Last year was very rough，Both franchise hotels and customers have expressed dissatisfaction with the company。Of its 12,000 employees in India，Nearly 20% were fired。188bet game’s businesses in other countries are also facing layoffs。

188bet game still has a fatal problem - funding。The reason why 188bet game can expand rapidly，A large part can be attributed to the funds raised，The most important one comes from SoftBank (holds nearly 50% of 188bet game shares)。But，After the aborted listing of WeWork，Sun Zhengyi’s requirements for invested companies have also changed。Now，188bet game has to abandon the slogan of “Growth at All Costs”，Turn to a "sustainable profit path"。

Can 188bet game be sustainably profitable? The answer lies in its financial reports.

Mid-February，188bet game’s financial report data for the fiscal year 2018-2019 (as of the end of March 2019) shows，Its losses exceed revenue growth。188bet game’s total revenue in this fiscal year is 9.US.1 billion，An increase of 4 compared to the same period last year.5 times；Loss 3.US.5 billion，An increase of 7 times compared with US million in the same period last year。

Comparison of 188bet game fiscal year 2019 and fiscal year 2018 data，Source: The Ken

The data is pessimistic。Not only did 188bet game’s losses grow faster than its revenue in this fiscal year，The proportion of losses to revenue is also expanding，Grown from 25% to 35%。In annual report，188bet game further stated，Total gross profit margin from 10.7% reduced to 7.1%。Almost no signs of profitability。

But the company’s management sees it differently.

188bet game CEO and founder Ritesh Agarwal thinks，The company’s business can be divided into three different stages in the market。

India first。India is 188bet game’s largest market，It is also the most mature market。In India，The company claims，"Chasing the best gross profit margin，Finding ways to make profits”。

Followed by markets such as China and Southeast Asia。188bet game has invested heavily in these markets，Although these investments have dragged down the company's financial performance，But now it is also ready to bring revenue and gross profit margin to the company。

Last，Other markets in the world besides the above regions - such as the United States and Latin America。188bet game has entered these markets less than a year ago，Currently building the business。

Tell a nice story

Fiscal year ending March 2019，188bet game’s total revenue in India is 6.USD 0.4 billion (64% of total revenue)，Up from 2 in the previous year.USD 1.1 billion，Nearly 3 times the year-on-year growth。Its losses increased from US million to US million，Small increase。Calculated as a percentage of revenue，India’s proportion of total losses is only 14%，Decreased from 24% the previous year。

Former 188bet game India CEO、Current board member Aditya Ghosh said in an interview with the media，The gross profit margin of the Indian business increased from 10% in the previous fiscal year.6% increased to 14.7%，“This demonstrates the strength of our business model。”

Are his words credible?

First，The company has cross-departments、Cross-market fee rationing problem。188bet game an accounting perspective，In order to present a good performance in the market，The practice of attributing spending to other market segments。Some large companies often adopt this approach，Bring a good story to shareholders and the public。

188bet game has at least 40 subsidiaries in India and around the world。If from India Marketing Department，Or human resources and other departments come up with million，Then accounted for in another subsidiary，It’s not that difficult。

We saw it in the financial report，FY2019，188bet game’s operating income in India reaches 5.USD 8.1 billion，Gross profit margin is 14.7% (gross profit approximately US million)，Both numbers are very impressive。

But these numbers are also misleading.

From April 1, 2018，188bet game changed its accounting method，Calculate "net realizable value" (representing the total value of goods) as revenue。188bet game begins to include room sales revenue in gross profit margin，This change means，Indicators previously viewed as “income”，Now regarded as "gross profit"。

If aware of these changes，The numbers on the financial report are not so pretty。

Will 188bet game give up on China

188bet game is still far from being truly profitable in India，Although the numbers have improved，But it is unlikely to move towards profitability。

So what is the situation of 188bet game in China?

188bet game’s financial data display，As of March 2019，Nearly 75% of the losses came from the Chinese market。The company claims，Loss is due to，To develop new markets、Invested in preliminary preparation and manpower recruitment，The decline in revenue has led to greater losses in initial investment。

But the actual situation is， 188bet game only launched in China in November 2017，No large expenses were spent in the early stage。

According to public data，188bet game China has more than 50,000 guest rooms in less than a year。March 2019，Aditya Ghosh once said: “India and China are both our home markets，Even China has more rooms than India。”

In an interview in August 2018，Li Taixi said that 188bet game is already the second largest hotel chain in Shenzhen，Shenzhen is also the fastest growing market in China。He also said，188bet game China’s business received a large amount of funds，Achieved asset-level profits within two months of going online。

Based on these statements，188bet game China’s losses are due to entering new markets，Obviously untenable。

Coincidentally，188bet game’s series of negative news in international markets such as China and Japan，Very similar to complaints faced in India。For example，188bet game failed to honor the guaranteed amount to the participating hotels、The guest room conditions are not up to standard, etc.。

Currently affected by the new coronavirus epidemic，Almost predictable，188bet game’s business in China will suffer huge losses。

Therefore，If both Indian and international markets are far from achieving profitability，Is 188bet game destined to lose the expansion battle？

Maybe there is a glimmer of hope。188bet game latest 8.US>340_word_end<.7 billion in financing，Showing Sun Zhengyi’s attitude。Whether 188bet game is currently the most important startup in the world，But it is definitely one of the most important startups in Son’s eyes。The Vision Fund cannot afford to open a second WeWork。

*Source of this article: WeChat public account "Zhixiang.com”(ID: passagegroup)，Author：Yanni, Diqing, Bingchen，Original labelTitle: "SoftBank and others invest US7 million, 188bet game "continues to live" 》.