MakeMyTrip Limited (MMYT) 2027 Q2 法說會逐字稿

Hello, everyone. I'm Vipul Garg, Senior Vice President, Investor Relations at MakeMyTrip Limited, and welcome to our fiscal 2027 second-quarter earnings webinar. Today's event will be hosted by the company's leadership team, comprising Rajesh Magow, our Co-Founder and Group Chief Executive Officer; Mohit Kabra, our Group Chief Operating Officer; and Dipak Bohra, our Group Chief Financial Officer.

As a reminder, this live event is being recorded by the company and will be made available for replay on our IR website shortly after the conclusion of today's event. At the end of these prepared remarks, we will also be hosting a Q&A session.

Furthermore, certain statements made during today's event may be considered forward-looking statements within the meaning of Safe Harbor provisions of the US Private Securities Litigation Reform Act of 1995. These statements are not guarantees of future performance, are subject to inherent uncertainties, and actual results may differ materially.

Any forward-looking information relayed during this event speaks only as of this date, and the company undertakes no obligation to update the information to reflect changed circumstances. Additional information concerning these statements is contained in the Risk Factors and Forward-Looking Statements section of the company's annual report on Form 20-F filed with the SEC on July 27, 2026. Copies of these filings are available from the SEC or from the company's Investor Relations department.

I would like to now turn over the call to Rajesh. Over to you, Rajesh.

Thank you, Vipul. Welcome, everyone, to our second-quarter call for fiscal 2027.

We are pleased to report strong market-leading growth despite a challenging environment for the travel industry, particularly in the air travel segment. The West Asia conflict and resulting inflationary pressures due to high ATF prices and INR depreciation have weighed on air travel demand, both for international and domestic air travel.

Our performance in such difficult macro conditions is a testament to our resilient comprehensive product portfolio strategy, both in retail and corporate segments, as well as the focused execution by the team.

Our strong Q2 performance in a low leisure travel season quarter was led by domestic travel and short-haul international destinations for leisure purpose, while business travel within India continued as usual, resulting in robust growth in our corporate business. We were able to capitalize on the shift of choices with our Ground transport offerings along with unmatched accommodation options resulting in robust growth in these segments while performing in line.

With the market on air travel.

We continue to deliver growth and profitability while investing in the capabilities that will support our long-term growth. In Q2, we delivered gross bookings of $2.7 billion, witnessing growth of 20.9% year-on-year in constant currency and adjusted operating profit of $46.2 million. All business segments delivered strong growth both in volumes and gross bookings value except air ticketing where we continue to hold on to our market share in domestic air ticketing and perform better than market in international air ticketing.

Our non-air business mix has now reached 63.2% compared to 61.5% during the same quarter last year. We believe our resilience is best reflected in our ability to sustain customer engagement, serve evolving travel needs across categories and deliver profitable growth.

India's underlying economic momentum and propensity to travel remains robust. Therefore, our longer-term view of India remains unchanged. The near-term environment calls for careful execution alongside continued investment in the market with substantial long-term potential.

An expanding base of aspiring travelers, participation from smaller cities. Improving connectivity and digital payments will support growth in travel consumption over time. The opportunity includes both increased travel frequency and a greater share of that travel being booked online. Progress will vary by category and market, but the underlying need for convenient, reliable travel services remains strong.

This is why we continue to invest beyond the immediate quarter. Hotels, alternative accommodation.

Buses, intercity cabs, tourism experiences present opportunities where the supply is fragmented and is digitally underpenetrated. In these categories, growth requires us to make supply easier to discover and book, improve confidence in the product, and deliver dependable service.

Building these capabilities helps expand the online market and strengthens our ability to earn a larger share of it.

For hotels, we continue to drive online penetration by going deeper into the country and aggregating fragmented supply. Similarly, our intercity cabs business, which we started to build only a couple of years ago, is now growing upwards of 40% year on year, although on a small base.

Our objective is to build sustained share gains through a better customer and partner proposition backed by a strong tech platform.

Let me now share how we think about AI. We see AI as a net positive for online travel platforms, particularly in large emerging markets such as India.

AI can gradually change how customers search and book for travel, but it does not change what it takes to deliver a trip. Accurate and bookable supply, reliable transactions and someone accountable when plans change. We believe value will accrue to platforms that are. That own those capabilities, and these are the capabilities we have spent building over the last two decades. Travel is an involved purchase with an element of inspiration, exploration, emotion, and experience, and often a significant share of household spend.

Customers like to explore multiple options, take time to discuss with families and friends before choosing the reliable option. We expect conversational assistance and visual discovery to work together. With customers choosing how much of the journey they want to delegate.

The nature of supply in India is central to how we think about this. Much of India's travel supply is fragmented and a meaningful part of it still operates offline. Independent hotels, homestays and villas, thousands of private bus operators and local cab operators.

A large part of this supply does not have structured content or a reliable digital footprint of rates and availability. A horizontal AI assistant can only recommend what is discoverable, accurate, and bookable that is available on the internet. And in India, much of that layer does not exist on the open web. It has to be built on the ground partner by partner. Our domestic accommodation portfolio now covers more than 105,000 options across over 2000 cities, and our bus platform carries more than 50,000 schedules a day.

Behind these numbers are years of partner onboarding, content creation, inventory, and pricing tools. And quality checks. This is difficult to replicate, and AI makes it more valuable, not less.

Our second advantage is proprietary data. Over two decades of searches, bookings, cancellations, and reviews from customers who have actually traveled give us a grounded understanding of what a property is really like, which room suits a family with elderly parents, or which bus operator runs on time.

Our knowledge graph connects property attributes, reviews, images, and location intelligence with customer preferences. General purpose models built on public information do not have this transaction level understanding, and it is what makes recommendations relevant.

As AI makes information more widely accessible, we expect differentiation to depend increasingly on the relevance of recommendations, the quality of bookable options, and the reliability of service.

Third is the transaction and the relationship after it.

A traveler needs confidence that the price is final, that the payment has gone through, whether by UPI, card or EMI or with the right GST invoice for a business traveler, and that support will be available if plans change. When a flight is canceled, a booking needs to be amended or a property does not meet expectation, the customer needs a clear point of contact. Who can rebook, refund, and coordinate with the supplier. Our ability to connect discovery with booking, payments, amendments, refunds, and assistance at scale and across languages is central to our proposition.

This brings me to trust, which we believe will shape how customers adopt AI in travel.

General purpose assistants are useful for inspiration and research, and some travelers may begin their journeys there.

But planning a trip and committing money to it are different decisions. When a customer is spending a meaningful part of their monthly income on a family holiday, they want the answer to come from someone who can see live inventory and actual policies can complete and change the booking and stands behind the outcome.

A general assistant can recommend; a travel platform is accountable for delivery.

We think this distinction matters most at the point of payment and when something goes wrong, it is where a vertical assistant backed by a trusted brand has a natural advantage. In India, this matters even more. Many of the customers coming online are first-time or infrequent travelers from smaller cities, often more comfortable speaking in Hindi or a regional language than typing in English and highly value conscious. They often need help understanding an unfamiliar destination or product. A customer planning a pilgrimage with elderly parents may want to explain the budget, accessibility needs, and meal preferences in their own language and be confident that what gets booked will match. A travel specialist assistant backed by brands customers already know, such as MakeMyTrip, Goibibo, and redBus, is well placed to earn that confidence. We believe this can help bring assisted and offline travel demand online and help smaller suppliers reach demand they would otherwise find difficult to access.

These are meaningful opportunities to expand the market.

Our early experience supports this view. Building on last quarter's launch of Myra 2.0, we made our AI travel assistant smarter, faster, and more closely integrated into customer journey.

Expanding its capabilities across end-to-end trip planning, native voice interactions, and in-chat payments. Myra now engages in over 90,000 daily conversations and assists over 3,000 bookings a day.

Customers engaging with Myra convert at around 1.7 times the rate of those who don't.

In tier 2 and tier 3 cities, which account for around 55% of Myra conversations, this rises to over 2.1 times. These are the customers who benefit from the assistance, and these patterns reinforce our view that a travel specialist assistant can help more of them book with confidence. Myra also resolved over 53% of post-booking queries autonomously in relation to flights and hotels.

We have also embedded generative AI into our core hotel and flight booking journey, helping customers express their preferences in natural language and discover more relevant options.

AI-powered semantic search now accounts for around 10% of hotel searches, with conversion rates approximately 24% higher than filter-led search. Smart Filters and Myra recommendations within the booking journey are showing even greater conversion advantages, particularly among new customers.

Our approach is to keep strengthening our AI interface, Myra, while experimenting with external assistance alongside.

Customer-facing applications, our investment priorities include AI-assisted engineering, partner onboarding, and customer support.

AI can make the work of aggregating fragmented supply faster and more efficient, for example, in creating content for and onboarding smaller partners, and we see scope to reinvest part of those productivity gains and growth.

We will measure success through better customer outcomes, dependable services, and sustainable economics. With appropriate oversight where human judgment remains important.

To summarize, we are driving three economic outcomes with AI.

A, growing revenue and conversion through personalized discovery, semantic search, assisted planning, relevant cross-sell, and better matching of customer intent with available inventory.

B, improving operating productivity through automation of routine servicing, engineering productivity, supplier. Content creation and faster partner onboarding and C, expanding the addressable market by bringing fragmented supply online, enabling customers to transact in regional languages and making complex travel products easier to discover and book.

Looking ahead, we remain mindful of evolving geopolitical environment and macro situation. We will continue to serve customers across their travel needs, strengthen our presence in categories. With significant potential for online adoption and invest with discipline in future growth.

We believe this approach positions MakeMyTrip well to capture India's long-term travel opportunity and deliver sustainable, profitable growth.

With this, let me now hand over the call to Mohit for business highlights of the quarter.

Thanks, Rajesh, and hello, everyone.

During the reported quarter, the external environment remained challenging. For the Indian travel industry and particularly for our outbound and air-ticketing businesses.

While making sure that we performed better than industry in the impacted segments, we focused on driving growth momentum in the other segments of travel such as accommodations, ground transport, including bus and cabs, as well as a variety of ancillary travel services. As a result, we were able to post gross bookings year-on-year constant currency growth of 20.9%.

The ability to drive strong operational results even in a seasonally weaker quarter for leisure travel, despite the degrowth in the air ticketing industry, shows the resilience we have built in our overall business and in being able to dial up different lines of businesses and/or demand segments, largely led by our ability to offer curated travel options that suit the pocket of every Indian traveler.

In view of high airfares, we dialed up. Growth across domestic destinations, promoting drive-down breaks, short-duration holidays, pilgrimage-led trips and supported the breadth of our hotel and ground offerings. Our operating focus remained on expanding relevant supply, improving the booking experience and encouraging repeat usage.

As we build on this breadth, we are deepening our capabilities within each category to serve more travel locations and across price points.

Let me now share some segment-wise commentary, beginning with hotels and packages, which accounts for a leading 40% share of our business mix.

During this quarter, this segment delivered adjusted margin of $116.8 million, representing a strong year-on-year constant currency growth of 20.2%. Standalone hotel room nights grew 18.6%, driven by a strong growth of 20.4% in domestic hotels.

It was encouraging that despite the degrowth in outbound travel from India due to a variety of external factors, our international room nights continued to grow at mid-single-digits year-on-year.

Domestic growth was powered by curating wider supply to drive demand for variety of travel occasions, including short duration, spiritual tourism or celebrations such as anniversaries and family gatherings. International travel demand has also held up across. Destinations outside the Middle East and long-haul markets where geopolitical headwinds and high fares continue to weigh on travel.

Accommodation remains an important investment priority for us. India's supply landscape is fragmented with a wide range of independent hotels, homestays, and villas. For many partners, the opportunity involves getting discovered and bringing more of their business online.

At the end of the quarter.

Our domestic accommodation portfolio covered more than 105,000 options across 2,080 cities in the country.

Alongside expanding coverage, our priorities include improving content, availability, and personalization of recommendations so that our customers get the most relevant options to choose from and our supply partners see improving business from participating on our platforms.

While geopolitical headwinds weighed on near-term international demand, we continue to see outbound travel as a significant long-term growth opportunity and therefore continue to invest in building international hotel supply. We are expanding our directly contracted hotel network.

We have expanded our direct hotel supply by adding 45 new cities during the last one year, taking our total presence to about 110 destinations globally.

Overall. The directly contracted international hotel portfolio grew to 40,000 accommodations, a 30% increase over same quarter last year.

These investments broaden our offering and strengthen our ability to capture growth as demand recovers.

In hotels, we are combining a broader range of accommodation options with technology that helps customers find the right stay for their needs. From family holidays and pilgrimage trips to group travel, events or business-related travel, we continue to expand our supply and product capabilities to serve each of these occasions a lot more effectively.

Our focus extends across customer cohorts and price points, offering relevant choices for different budgets and preferences. We continue to accelerate our efforts to solve for specific needs of the Indian customers as they travel within India and internationally.

Flexibility with hourly bookings, solving for guaranteed early check-ins, upgrading to better rooms, getting the right meals, group stays or child stay options are some of the examples of areas which we have worked on with deep consumer insights and specific needs. While solving for customer needs on one side, these value propositions also help build incremental revenue for our supply partners.

These value propositions were driven. Largely by rolling out an AI-enabled deep learning system across our apps, combining our proprietary knowledge graph of property attributes, reviews, images, and location intelligence with customer insights on preferences and behavior to deliver more relevant recommendations for our customers.

This improved visitor conversion by over 2.5% with gains of nearly 6% for super premium stays, including villas.

The system is now live for all app users and we continue to expand the coverage and refine the model.

In homestays, we continue to invest behind building the category. We enhanced our product proposition by introducing locality highlights to help customers better understand the property's surroundings and be able to book with confidence, particularly in destinations like hilly areas where homestays and villas are often spread across offbeat locations.

This feature is now live across hill destinations and has delivered over 5% conversion uplift for the relevant properties. During the last quarter, we sold over 29,400 unique properties across 1,185 cities. We plan to extend this feature to relevant pilgrimage and leisure destinations as well.

In tours and attractions, our aim is to serve more of the trip beyond the initial flight or hotel booking.

Discovery and booking of these services remains fragmented across most destinations, making relevant activities available alongside the customer's itinerary can improve convenience and increase engagement during travel. With a view to drive convenience in booking and selection, we introduced the MMT Experience Pass, a flexible bundled offering designed to encourage customers to book multiple activities within a destination with compelling value proposition.

Early adoption across Southeast Asian destinations has been encouraging and reinforces the potential of offering these bundled experiences to drive higher customer engagement and gain larger wallet share.

Our bus ticketing business where redBus is a strong market leader with phenomenal top-of-mind recall continues to deliver strong growth. We delivered volume growth of 24.7% year-on-year with 29.4% growth in gross bookings and 29% growth in adjusted margin in constant currency terms. We continue to work very closely with our bus operating partners to add more inventory, particularly in overnight or pilgrimage-led routes, which are seeing much better offtake in view of the prevailing high airfares. Hence, almost half of the growth is led by inventory additions with the rest being market share gains.

We continue to be optimistic about this segment in view of the improving highway infrastructure and investments by our supply partners in fleet upgrades. We expect this momentum to continue in the coming quarters in line with the upcoming festive demand alongside a gradual shift towards higher quality buses with enhanced amenities.

We continue to enhance customer experience by expanding the coverage of the customer comfort score.

Displaying onboard toilets, emergency exits in seat layouts, improving in-app live tracking experience and enhancing our AI assistant tray.

Our campaign on ease of travel, particularly for women travelers on buses with inbuilt toilets gained good traction among women travelers across India. These kind of product-led initiatives are helping us further strengthen our customer proposition.

Coming to the air-ticketing business, this has been impacted by macro headwinds. Overall, market supply was constrained and domestic departures witnessed a decline of 7% year-on-year, while international departures witnessed a degrowth of 4% year-on-year.

Both high fares and constrained capacity impacted demand leading to an overall decline in flown passengers. In line with our stated strategy, we continue to maintain a leading 30% plus share of domestic air ticketing market.

AI remains an important part of our customer proposition and a source of engagement across the travel journey.

AI is becoming an important differentiator in our flights business, helping us improve both booking as well as service through smarter fare discovery, personalized recommendations, integrated trip planning and proactive disruption management. These capabilities are designed to strengthen the customer experience and improve the economics of the business.

We continue to enhance our product proposition and drive cross-sell. During the quarter, we launched an integrated flight plus cab booking experience, connecting customers to 200-plus high-demand destinations across India without airports through a single purchase journey.

The feature simplifies end-to-end travel planning and supports cross-category adoption. Rollout is underway with flights and cab combinations being optimized for total travel cost. And journey duration.

Let me now share some details specific to our B2B or corporate business as well as the indirect B2C channels. We continue to sharply target different demand cohorts via our corporate platforms, travel agent networks and affiliate partnerships to extend our reach to a broader customer base.

Our corporate travel business continues to perform strongly, tapping into a demand pool that complements B2C travel. This mix adds resilience and helps navigate short-term headwinds more effectively.

MyBiz and Quest2Travel, the two platforms that we operate on the corporate side, allow us to serve businesses with different requirements from SMEs to large enterprises.

These customers value policy controls, reporting and support alongside convenient booking. At the end of the quarter, MyBiz served about 84,600 active corporate customers. As compared to about 75,500 corporate customers during same quarter last year and Quest2Travel served 568 large customers compared to about 527 large customers served a year earlier.

Our travel agent platform, myPartner, continues to see growing adoption with more than 26,000 unique agents transacting during the quarter for the first-time. This was supported by an on-ground engagement and technology-led CRM initiatives.

Agents are also booking a broader range of offerings with healthy repeat activity reflecting stronger engagement and further cross-sell potential.

Another distribution channel for us is myAffiliate, wherein we power travel for other online platforms like Amazon Pay, PhonePe, et cetera. While myAffiliate remain a small part of our overall business, it is helping us acquire new customers.

Based on seasonality and shifting of demand patterns, we will continue to leverage our varied distribution capabilities to maximize overall growth for the business. With this, let me now hand over the call to Dipak for the financial highlights of the quarter.

Thanks, Mohit, and hello, everyone.

Before turning to the financial highlights, I would like to highlight the notional translation impact of the rupee depreciation against the U.S. dollar. Compared with last year to ensure our numbers are well understood.

In Q2, currency depreciated by around 10%, resulting in lower year-on-year growth rates by approximately 10 percentage points in reported currency due to translation itself.

Our commentary therefore focuses on constant currency growth to provide a more accurate view of underlying business performance.

To start with, gross booking value for the quarter grew 20.9% YoY in constant currency terms with all key segments growing in double-digits. The quarter performance was supported by strong growth in hotels and packages, bus ticketing business and other segment, helping us deliver strong operating performance despite macro headwinds.

Moving on to our segment results, our air ticketing adjusted margin stood at $108.6 million. Registering a YoY growth of 14.3% YoY in constant currency.

While the overall airline departures and passenger flow volume declined YoY and the fares increased in the range of 25% to 30% YoY due to macro headwinds, we performed better than the market, maintained our market share and achieved robust growth in adjusted margin on the back of strong ancillary attach and better unit economics.

For the hotels and packages segment, we recorded strong volume growth of 18.5% YoY, with standalone hotels growing faster at 18.6% YoY on the back of strong demand in domestic hotel segment, which grew at over 20% YoY.

We benefited from the shift in leisure demand towards domestic travel, including short duration and drive down holiday and pilgrimage-led travel.

Our expanding supply across established and emerging domestic markets allowed us to participate effectively in this shift.

International Hotels segment growth was muted this quarter due to macro headwinds. Hotels and Packages gross booking growth was at 19.7% YoY and adjusted margin growth was at 20.2% YoY in constant currency terms coming at $116.8 million.

Ground transport continued to grow at strong pace during the quarter.

Supply additions, wider route coverage and the continued development of India's highway infrastructure supported the category's structural growth.

Bus ticketing adjusted margin was at $45.1 million for the quarter, registering a strong growth of 29% YoY in constant currency.

Our ancillaries business, which includes intercity cabs, rail, insurance, ForEx, tours and activities and other ancillaries and is part of the other segment is scaling up well aided by higher attach rates of ancillary services. As a result, adjusted margin from other segment came at $24.4 million, witnessing a strong growth of 29.8% YoY in constant currency terms.

Moving on the expense side, most expenses came in line. Marketing and sales promotion expenses for the quarter was 5.4% of gross booking value compared to 5.2% during the same quarter last year.

We continue to invest selectively to support future growth and gain market share, particularly in categories where online penetration remains low. Our investment approach is to balance current performance with the capabilities needed for future growth. Priorities include accommodation, ground transport, emerging categories like tours and activity, customer experience and AI.

We assess these investments against adoption, repeat behavior and contribution economics. We are also investing in AI with a clear focus on returns. Early efficiency gains are creating room to fund future growth. Our financial priorities remain to support profitable growth, maintain the flexibility to invest and allocate capital with discipline.

Adjusted operating profit for the quarter came in at $46.2 million, witnessing a growth of 13.8% YoY in constant currency.

Our adjusted operating profit margin was 1.7% of gross bookings this quarter, compared with 1.8% a year ago.

This is primarily due to divergence in air ticket revenue. Our air ticket revenue is largely linked to number of tickets booked, while payment gateway charges are linked to the total booking value. With airfares going up by 25% to 30%, processing each booking became more expensive without a corresponding increase in revenue per ticket. We expect this gap between revenue and processing cost to narrow as fares and volume normalize supporting a resumption of margin expansion.

Adjusted net profit before tax grew by 27% year-on-year to $46.2 million, reflecting our underlying earnings performance. Reported profit includes non-cash charge of $29.6 million in notional interest on our zero-coupon convertible bonds and $5.9 million in translation related to foreign currency expense, neither of which represent any cash outflow. We have strong balance sheet and our cash flow generation continues to be robust. We ended the quarter with a cash and cash equivalent balance of $815 million, apart from a small investment plan.

Increase of our stake in BookMyForex, we deployed $17.2 million in the buyback program during the quarter.

The company is preemptively managing dilution through buyback program.

Cumulatively, we have now repurchased 2.23 million shares, covering about 37% of the share capital expected to be issued related to 2028 convertible bonds. On the proposed IPO of our wholly owned subsidiary MakeMyTrip India Limited, we have made a confidential filing earlier and continue to work with the capital market regulator and stock exchanges to get the due approvals. The timing of the IPO is subject to regulatory approvals and market conditions. With that, I would like to turn the call to Vipul for Q&A.

(Event Instructions) Sachin Salgaonkar, Bank of America.

Thanks, Vipul. I have three questions. First question, just wanted to get a sense.

On early indications how the December quarter is turning. Clearly, DGCA data shows traffic is down every month given the supply issues and higher oil price. So as we head into the seasonally stronger quarter, should we expect a softer quarter versus what we have seen historically? And the related question is your inducements are increasing. So does that mean marketing spend as a percentage of.

GBV should be closer to 5.5 or higher than that for this fiscal year? Let me pause here.

Hi, Sachin, maybe I'll take the first.

On the growth side, yeah, the growth on the flight side, basis the reports coming from DGCA are a good leading indicator of how kind of travel is behaving.

But you would see that over the last so many quarters now.

The overall growth for the platform for us has been a lot more robust compared to how flight ticketing per se is behaving. Like even in this current reported quarter, you would have seen the degrowth in the air industry was larger than the degrowth say we saw in the previous quarter. But despite that, the overall growth that we were able to drive across the businesses. Was actually slightly higher than even in the previous quarter or Q1. So actually, overall growth has actually improved through this quarter despite the setback on the flight ticketing side. And that would be our endeavor. And like we've been calling out over the last few quarters, we want to kind of build more and more resilience within the business, that even if there is a line of business or a segment which is not doing very well.

Due to macro headwinds, we try and kind of make that up through the other lines of businesses. So that's something that we continue to endeavor even in the upcoming quarters. On the other item, which is regarding the increasing customer acquisition costs, like I had called out earlier also, because of a degrowing and as a result of that, the mix is improving and going more and more towards. Higher margin businesses like accommodation and say for instance, ground transport or other segments which are reported in the other kind of a segmentation.

With this improved margin businesses kind of increasing share in the mix, our ability to spend a little more on customer acquisition is much better. And therefore, while making sure that on the bottom line, we continue to kind of remain robust. This should be seen in line with the mix of the business and the improving mix of the business. So if that continues, I don't think we would be, kind of worried about optically the customer acquisition cost looking slightly higher.

Got it, pretty clear Mohit. Second question, your press release does indicate customers are engaging with Myra and now I think 1.7 times more bookings are done versus non-Myra customers. So is this a sign that consumers are comfortable with agentic AI? And if that's the case, then do we see a risk that the top 1% to 5% of users and given the fact that from a Pareto rule point of view, they're heavy spenders, if they eventually move towards agentic AI platforms, we see a risk of losing revenues. So we'd love to understand how should we look at the.

Consumer adoption of agentic AIs and how big that could be a risk, especially for your top users? I do understand the mass market users may never move to an agentic AI.

Maybe I can take that question. It's a good question as always.

A couple of points here, very important to understand. So the metrics that we have shared, like 3,000 bookings and 1.7x better conversion.

Is when customers are using Myra for assistance while they are in the consumer journey. So the regular consumer journeys, they are already on their flow and in between, if you have to ask a question, they are invoking Myra. So, and people who are invoking Myra and asking more clarificatory questions end up sort of converting 1.7x more than the others who don't.

So this is actually embedded in a way along with the consumer journey. So it's not that, at this point in time that we see in India that people are immediately starting from an initial search going all the way. And getting comfortable with the agentic commerce yet. It is more of a use case that is getting early days positive signals that they are quite happy to use agent for assistance as and when they need it, right? So that is one important point. The second is just the overall conversations are growing now. Right now, the adoption in India is more on sort of asking the questions around trip planning and doing the search, complex query, and also some smaller cities through the voice as well as the vernacular usage.

The new users who have not necessarily have ever used it are coming through the conversational interface.

Again asking few questions and then trying to sort of go to the funnel and do the booking. So I would say I don't think we should jump to conclusion at this point in time in India that they are completely getting comfortable with the start to end on agentic commerce yet, agentic commerce for travel yet and therefore time will only tell. And the last point that I will make is and I think I try to cover that.

In the script very elaboratively as well, the reasons for that, not necessarily only the mass market, the comment that you made, but also the savvy users that rather than going through the general purpose or a horizontal third-party agent, I think the vertical agent.

With a trusted brand and the expert with proprietary data over the years would be better placed to service the end-to-end vertical assistance, if you will, rather than coming through the third-party agent, right? So that's really our view at this point in time, especially in the emerging markets. Because the level of deep content that we have sort of built over a period of time, given the fragmented nature of the supply underneath across the segments, is very rich and it's very hard to replicate. So unless a third-party agent starts to, they look to start building the capabilities where they can go end to end, which there is. Ample clarity and that there is no real direction on that front.

I think the vertical travel assistance or I don't know about the other category, but I would have thought, sort of the first principle even in the other categories might be in a better position to sort of leverage to that shift of trend that as and when that happens.

Thanks, Rajesh, it's very elaborate. And my last question is, what do you could share on a potential India IPO, anything new? And I'm asking it because Dipak did mention that IPO timing is subject of market conditions and SEBI approval. But looking at where macro conditions are, where oil at $114 plus and overhang on agentic AI globally on the OTAs, softer demand and even the sentiment across for stock markets across the world is not as great.

So is it fair to say that ideally.

There's no IPO happening for the next six to nine odd months or we don't know all that. Any clarity, any incremental new info would be helpful. Thanks.

Yeah, happy to take that, Sachin. In fact, we've always said that any capital market activity is always subject to market conditions. And I think the best thing that one can do is to kind of remain prepared to be able to.

Utilize a good market opportunity.

From that point of view, like it called out, they've already made a confidential filing.

And one of the reasons for doing confidential filing was that in troubled markets, confidential filing allows you a much larger tenure through which it is, kind of valid. So it's almost valid for like 18 months. Right now we are at a stage where we are still working with the regulators in terms of responding to their queries and awaiting their approval on the.

On the confidential filing post, which will kind of take the next steps as and when appropriate based on how the market kind of, remains. So I think we remain prepared and we'll kind of dial in as market conditions, suggest.

And in that sense, Sachin, actually there is no change fundamentally of the approach.

Since your question was, is there anything new or change? It's actually not change. The change might be market condition, which was always the case. So there is no real change. It's just basically we will stay, as Mohit said, we stay prepared and then keep watching the market condition and then as and when there is an opportunity, we look at it.

Got it.

Thank you all and all the best.

Thank you.

Manish Adukia, Goldman Sachs.

Thank you, Vipul. Hi, good evening, team.

Thank you for taking my questions. My first question is on the air business. I mean, historically, the way at least I understood the business was that your air revenue growth is more indexed to volume growth and less to GBV growth, but in the recent quarter, it does feel like it's tracking materially higher than the volume growth, at least the adjusted margin number. One, if you can explain.

Why that is the case. And two, in that context, is the right method to look at for your business, the IFRS revenue, maybe more than the adjusted margin? If you just maybe help me understand that, that'll be great.

So Manish, as on the e-ticketing business, it is more flattish margins than kind of completely variable, like some of the other lines of businesses such as accommodation, bus ticketing, et cetera. The margins that we earn are completely variabilized, right? And therefore, any change in the ASPs and immediate impact on the absolute margins earned also. In case of flights, it is more kind of, fixed kind of number than variable, but that doesn't mean there is absolutely no variability at all, particularly when it comes to rear-ended incentives or say any upfront incentives that we have with the airlines. Some of the segment fees etc there is a little bit of a variability as well so some of the you know the ASP increases do kind of you know help and the other thing to kind of keep in mind is usually you would find that in softer seasonality quarter the margins tend to be slightly better compared to you know the seasonally kind of you know peak quarters and therefore. Again, the margin percentages in this quarter are largely in line with say similar quarter in the previous years as well, so largely in line and in tandem, nothing specific or kind of differentiated in particular.

Thank you, Mohit. My second question is on the inducement costs. So maybe two parts of the question, right? One, I mean, I understand the mix shift that you called out earlier, Mohit, towards hotels, which is driving overall inducement costs high, but if I could just the inducement costs in the hotel segment alone, there also directionally the inducement costs have moved higher.

One, if you can explain what is driving that.

And second. Just a hypothetical scenario, let's say hypothetical if air demand were to improve next year and the inducement costs in the air business, which are today high, come down to where it used to be in the past.

And today, let's say you're talking at 5.5% overall inducement cost at a company level, right? And let's say that falls to a lower number, 5.1%, 5.2%. Should directionally all of that flow to the EBIT number, what I mean to ask is today you're at 1.7% EBIT margin, you've been in that range for a while.

Is there a possibility that if demand recovered or certain inducement costs can suddenly fall quite sharply and so EBIT margins may see a sharp expansion or am I thinking that incorrectly?

To a large extent, you're right, Manish. And like I've been saying, we've got to kind of look at the customer acquisition costs or inducement costs in line with the mix of the business and therefore, say for instance, if. If the mix is kind of growing in favor of say the higher margin businesses, the optically then you'll find the inducement cost as a percentage also kind of trending in that direction.

So you're right. The other thing that I wanted to clarify was it's only 1.7% that you look at it which is reported this quarter and might look. That we're kind of largely remaining in that range where we were, say, last year. Actually, it is a bit of an improvement because the denominator has undergone a change. Like Dipak was calling out in his part of the script, airfares have gone up by almost like 20%, 30%. That's clearly not in the normal course of business, right? Even if you were to assume that maybe up to 10% fare increases are normal in line with kind of inflationary conditions. The rest, which is almost at least 15% is kind of exceptional. And considering that air accounts for almost 60% of the gross bookings, that's almost like the denominator has gone up by 9 percentage points. So this 1.7%, but for this situation on AI pricing would have looked much better as a percentage of gross bookings. So optically, as like I always keep calling it out based on market situations, some numbers like adjusted margin or. Or say adjusted operating margin as a percentage of gross booking or customer acquisition cost as a percentage of gross booking will kind of move in tandem with market conditions.

But you are absolutely right that if kind of the overall situation on travel was to ease out and the demand was to come back a lot more comprehensively with the air kind of also contributing to growth, there clearly is an opportunity for kind of getting more efficient on the customer acquisition side. And kind of seeing some more kind of improvement on the profitability side as well?

Thank you, Mohit. Can you just also address the first part of my question on the hotel segment in particular, why the inducement charges have been moving higher?

So, again, these are all kind of more last minute attribution and therefore I don't kind of like commenting on any specific quarter or any specific segment in a quarter because this, like I said, this attribution is more post-transaction or transaction led. And therefore, looking at these over a normalized period of say about four quarters is a better way to look at it rather than for any specific period.

Where I was coming from was I just wanted to make sure there is no element of competition or competitive pressures in this number.

Actually, not really in this segment at least for sure as you would have seen because if you really look at it overall, see the travel industry overall growth has been pretty muted. In fact, even if you look at for most players in this segment, the overall growth numbers have come down. In fact, even at a very large base, we have actually been able to deliver almost to our desire of kind of keeping adjusted margin growth in the high 10s to 20s. We have almost touched the 20% mark at about 19.9%. So I think kind of. It's not really necessarily seeing any competitive pressures as such but yes at a time when the there is a little bit of a disruption in the market we would want to kind of gain as much share of the market as possible in all the relevant segments.

Got it and just last question very quickly from my end and maybe I'll also try to push my luck on this one last time on the earnings call in the shareholder letter or filing you had talked about potential.

Fungibility of the shares, which is obviously a post-India listing discussion. Again, like anything incremental you can share on that aspect in particular, that whenever, let's say, market conditions allow and you do indeed list, do you have any more clarity on what shape and form structure may take so that the shares over time can become fungible, any color if you could get there?

Manish, like we had said, when we get into the India IPO, we would want to kind of figure out a path.

Between say MakeMyTrip, the Mauritius-listed entity and the potential India listed entity to figure out a path for creating fungibility or getting into a singular listing over a period of time. Of course, there have been various exploratory kind of, discussions which have been happening with the regulators. And as and when we get there, we'll definitely have more to share. But would be premature for now. I mean, I think to begin with, we'll wait for, the regulatory approvals to come in on the confidential filing. And then as we kind of, file publicly, I'm sure we'll come back with more kind of, color on these matters.

Thank you. All the best.

Thank you.

Parash Jain, HSBC.

Hi, thank you for the opportunity. I just wanted to understand the competition dynamics within your different business, particularly in air and hotel, especially on the air side when the volumes are going sideways. And in terms of competition intensity, do you think that access to the capital is a differentiator or how do you see gaining market share if the market growth remains subdued?

Thank you. So.

Paresh, maybe I can take that. I mean, like I think we've called out through the script and in some of the previous questions, no real change in terms of.

Competitive dynamics or competitive intensity as such.

And this I'm talking overall across the business and across lines of businesses as well. So no real kind of shift or change that kind of we've seen through the quarter or over the last few quarters as well. So pretty much kind of remains as is. I think we clearly are kind of away from the days of say maybe a decade back when a significant amount of private equity play could have kind of created a bit of disruption.

And that too was kind of largely happening because online penetration was in a very kind of infancy stage back then. Today, if you look at it across most of the relevant kind of travel segments, online penetration has already reached a threshold where.

Just kind of capital dumping is not going to create any sustainable advantage. And therefore, we do believe that market dynamics or kind of competitive dynamics will largely continue to remain as is and don't necessarily see any significant kind of changes on this side.

I just wanted to understand.

From your perspective, your focus is more on winning customers on quality service rather than on price. And what I wanted to allude to is that it's really constrained and with your strong balance sheet and access to the capital, is it an opportunity to go for the kill?

It's always been the former. It's always been the former to kind of win customers more on why we're kind of providing. More kind of relevant experiences and through better servicing rather than through pricing per se.

And therefore, capital to that extent has never been a constraint.

At times, like I have said, historically, when we were kind of pushed by competitive dynamics, we haven't hesitated in terms of leveraging the balance sheet or kind of deploying capital if need be.

But those are not really the times currently.

And clearly the approach has been more the former than the latter.

And if you may just add, Paresh, since I think you probably are coming from the fact that historically that has been maybe the market condition and all. Like Mohit said, I don't think that really is the market condition, but more fundamentally, see what is also proven over the years is that you don't typically achieve stickiness with the customers by just going.

Completely deep discounting way, right? So and time and again, and from platform to platform, from category to category, including ours, right? So and therefore, while we obviously stay competitive, there's no question that we will not be competitive and not only competitive, maybe we will also have the advantage given our scale and.

And the depth of partnerships with the partners that we would be in an advantageous position for us to be able to just get the most favored nation sort of pricing, et cetera, from pretty much every category as well.

And because we have that advantage and the fact that we have a large size of customers who have transacted with us a very high repeat rate. And we continue to keep acquiring new users, I think we are overall in a good position for us to be able to sort of grow even at the kind of scale that we have at a robust growth rate, pretty much every category. Even in the matured category, we've been sort of growing.

And wherever there is sort of lower growth that is by like, for example, domestic air, we've been sort of holding onto our share and that is by design our strategy. When market improves organically, we will get disproportionate share of that. So I think because of overall advantages that we have built over a period of time, both on the demand side as well as on the supply side.

We have been able to sort of so far continue to sort of grow with new users as well as the repeat rates, including getting more wallet share from the Indian travelers and we will continue to keep doing that. And so I don't think there is any sort of question around whether. It is going to be, the excess capital or lack of it is going to be the real differentiator anymore. It is more a question of holistic strategy that we've applied and sort of working out nice.

And maybe Rajesh, if I can squeeze one last question and that people actually have been over the past few months has been very kind to explain it to me. And like one of the pushback that we hear from. Your current investors is that potential listing of India will inherently bring a holding company discount. And I understand that the group has a plan eventually to find a solution of this dual listing.

How are you tackling that when you are interacting with the investor?

Hi, Paresh, I think I just kind of answered that.

In a previous question posed by Manish, if I'm right. And maybe therefore, in the interest of time, we'll move on to taking more questions.

Okay, sure.

Thank you.

We are out of time. So this was the last question.

And over to you Rajesh, for your closing comments.

Thank you, Vipul, and thank you everyone.

Thank you, everyone for your patient listening and.

As we said, we've covered pretty much every aspect of the business very elaboratively in the script. So we would encourage everyone to go through that and refer to that as and when you have follow-up questions and feel free to reach out to us as well and we'll be accessible and available.

And we will keep coming back with any material updates that we have as well. So looking forward to seeing you next quarter.

Thank you so much.

Thanks, everyone.

Thank you, Rajesh.

Thank you, everyone for joining. You may now disconnect the call.

Thank you.

Thank you.