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DATE

Wednesday, Jan. 21, 2026 at 7:30 a.m. ET

CALL PARTICIPANTS

  • Co-Founder & Group CEO — Rajesh Magow
  • Group CFO — Mohit Kabra
  • Head of Investor Relations — Vipul Garg

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TAKEAWAYS

  • Adjusted Operating Profit -- $50.7 million, marking the company's first time surpassing the $50 million threshold for this metric.
  • Adjusted Net Profit -- $51.4 million, with adjusted diluted EPS increasing by 33% year over year.
  • Air Ticketing Adjusted Margin -- $207.9 million, reflecting a 20.4% year-over-year growth in constant currency; international air ticketing now constitutes 43% of adjusted margin in this segment.
  • Share Repurchases -- 550,000 shares and $5 million principal of 2030 convertible notes bought back, totaling $46.1 million in program utilization, the highest in MakeMyTrip (MMYT 3.45%) history.
  • Domestic Air Market Growth -- Achieved 2.2% year-over-year growth compared to industry growth of 0.9%, with market share rising to just over 31% during the period.
  • Hotels and Packages Volume Growth -- 20.3% increase year over year, with standard hotels growing 20.6% and non-premium segment room nights up 23%; gross booking value growth was 15.9% in constant currency, attributed to GST rate reduction on sub-₹7,500 hotel rooms.
  • Bus Ticketing Adjusted Margin -- $42.4 million, up 26.1% year over year in constant currency, supported by private bus inventory rising to 45,000 daily schedules.
  • Ancillaries Adjusted Margin -- $27.5 million, up 45.5% year over year in constant currency, driven by expanding services including insurance, visa, forex, sponsorship, ad tech, and tours/activities.
  • Adjusted Operating Margin -- Improved to 1.82% of gross bookings versus 1.76% during the same period last year.
  • Marketing and Sales Promotion Expense -- Accounted for 5.6% of gross bookings, described as aligned with seasonality and a higher-margin segment mix.
  • Cash and Equivalents -- Ended the period with over $100 million in cash and equivalents.
  • Myra AI Implementation -- Scaled to 50,000+ daily conversations, with 72% rated as good quality; 45% of users in tier-two cities and beyond and 20% of daily interactions from new users, many from tier-three/tier-four cities, highlighting penetration into new markets.
  • GST Rate Impact -- GST on hotels below ₹7,500 reduced from 12% to 5%, resulting in volume growth outpacing gross booking value, specifically a blended 5% impact on gross booking growth from the tax change.
  • Corporate Travel Customer Count -- MyBiz active customers reached 77,500+, up from 64,000; Quest2Travel active corporate count grew to 539 from 493 in the same prior-year period.
  • Accommodation Offerings -- Platform now lists 97,000+ accommodation options in 2,050+ cities, with properties sold in 1,950+ cities and 100+ new cities sold for the first time in the trailing twelve months.
  • Hotel Margins -- Margins remained stable at 17.7%, with the company targeting high-teen margin levels for this business.
  • Other Financials -- Non-cash interest cost on zero-coupon convertible bonds was $28.3 million, and rupee translation-related foreign currency losses totaled $5.3 million.
  • International Hotels and Packages Mix -- Share of international revenue in hotels and packages rose to 24.2% from 23%.
  • AI-Powered Initiatives -- Launched AI-empowered features for supply partners and customers, including performance analytics for hotels in Hindi and English, women-specific ratings, review summaries, and safety indicators live across 33,000+ properties.

SUMMARY

Management confirmed that the GST rate reduction for hotels under ₹7,500 led to a distinct divergence between strong booking volume and more modest gross booking value and revenue growth. Strategic use of proprietary AI, including the Myra platform and new analytics for partners, was presented as a catalyst for user acquisition, customer engagement, and operational scalability, especially in tier-two and smaller cities. The company described its largest-ever in-market buyback and continued focus on reinvesting in AI-driven organic growth and select strategic opportunities. A shift toward higher-margin segments such as hotels, bus ticketing, and ancillaries led to improved blended profitability metrics and operating margins. Leadership indicated ongoing investments in corporate travel, ancillaries, and expanded in-destination offerings as essential elements for sustaining long-term growth.

  • Mohit Kabra disclosed, "We ended the quarter with cash equivalents of over $100 million," highlighting continued financial flexibility for investment.
  • Leadership stated the GST impact on gross bookings and revenue will persist for four quarters before cycling out of comparison, without suggesting additional one-off effects.
  • On the potential impact of generative AI competition from global search/AI platforms, Rajesh Magow said, "trip planning is the only piece where, you know, there is definitely a possibility given the richness of the data that they will have based on the LLMs. That they might get more traction," but countered that direct app traffic and proprietary data are defensive advantages.
  • The integration of Happay was described as "now complete," transforming the platform into a full-featured travel and expense management solution for corporate clients.

INDUSTRY GLOSSARY

  • FDTL (Flight Duty Time Limitation): Regulatory rules limiting flying hours and duty schedules for airline pilots, impacting airline capacity and operational scheduling.
  • LLM (Large Language Model): AI model trained on vast text data, enabling natural language understanding and interaction, applied by MakeMyTrip through its Myra product.
  • Adjusted Margin: Segment-level profit metric used by MakeMyTrip, which may exclude certain expenses or apply adjustments not consistent with GAAP.
  • Adjusted Operating Margin: Operating profit expressed as a percentage of gross bookings, excluding certain items to provide a clearer view of underlying business profitability.
  • Myra: MakeMyTrip's AI-driven conversational platform, supporting multi-lingual, voice-based, and personalized customer interactions across the booking journey.
  • Ancillaries: Non-core travel services and products offered on the MakeMyTrip platform, including insurance, visa, forex, and travel activities.
  • Quest2Travel: Corporate travel business acquired and operated by MakeMyTrip, serving large corporate clients.
  • MICE: Meetings, Incentives, Conferences, and Exhibitions; segment of group business travel often impacting demand cycles.

Full Conference Call Transcript

Rajesh Magow: Thank you, Vipul. Welcome, everyone, to our third quarter call for fiscal 2026. At the outset, I am pleased to share that Q3, which traditionally represents the high season for leisure travel in India, witnessed strong demand recovery, barring temporary disruption in December caused by new and stricter flight duty time limitation rules (FDTL) for pilots. The festive season and a series of long weekends fueled this demand momentum, reinforcing our belief in the emerging trend of Indian travelers' desire to spend more on travel. Our diversified product portfolio and market leadership continue to act as mitigating factors in case there is any macro disruption that happens in one of the segments.

For instance, while domestic air was impacted in December, we were able to capture some of this demand on other means of transport like bus and cabs. We continue to believe the Indian travel market is poised to expand, driven by a confluence of economic, social, and technological factors. Our focus remains on delivering superior value and seamless booking experience and support to our customers with constant product innovations leveraging AI. We see AI as a very welcome and positive tech evolution, opening up many new opportunities in our business. Leveraging AI, we are aiming to improve all aspects of the customer journey, right from inspiration, discovery, search, booking, and post-sales.

One of the most significant impacts of AI is the ability to offer a highly personalized experience. We have developed AI models using LLMs and vast amounts of in-house proprietary data to power Myra, helping customers interact with it from planning to eventually booking their trips. We believe over time, our product will be more relevant and effective because of our own proprietary data for travelers. Myra has now scaled to over 50,000 conversations daily, with over 72% of conversations being termed as good conversations. Around 15% of the conversations happen during the early stage of trip planning, enabling us to influence destination and product choice earlier in the customer life cycle.

Myra is also helping us drive penetration into smaller cities, whether it's vernacular voice capabilities, with over 45% of Myra users coming from tier two cities and beyond. Voice-led interactions are 50% higher in non-metro cities. AI is also helping us improve post-sales customer experience through a virtual assistant providing instant 24/7 support to travelers. Our AI voice and chatbots are now autonomously resolving about half of the customer queries across flight and hotels, significantly improving service scalability and efficiency in the system. We are also using AI to augment our data intelligence support to our supply partners.

For example, to empower our hotel and host partners, we have introduced a Geni-powered digital performance analytics summary in audio playbook format in Hindi and English, significantly improving partners' engagement. Besides following our one-stop-shop strategy with a view to meet all travel and travel-related needs on our platform, we have now expanded our product offerings with the recent launch of tours and activities, giving Indian travelers access to over 200,000 bookable activities across 1,100 cities in 130 countries worldwide. Indian outbound tourists often struggle with dispersed information, foreign currency pricing, and disjointed planning tools when booking activities and experiences.

Stitching all of it together, we aim to remove friction and make it convenient for travelers to book in-destination experiences also in advance before they start their travel. Let me now turn to business segments, starting with the air ticketing business. The air market supply and growth bounced back on the back of robust seasonal demand in October and November, with domestic daily departures growth of 25% year on year, respectively, from a degrowth of minus 4% in Q2. However, new flight duty rules caused disruption in December, leading to daily departures degrowing in December at minus 5% year on year as against expected 5% growth year on year.

Despite this disruption in the domestic market, we were able to deliver good performance aided by robust growth in international travel and our diverse portfolio of all modes of transport as some of the seasonal demand moved to other modes of transport. International outbound travel from India presents a significant growth opportunity. We remain focused on growing this segment. We have launched a new feature in the international flights funnel that provides users with end-to-end visa guidance for their destination. It covers visa types, processing timelines, permitted length of stay, required documents, and applicable fees. Users can also initiate their visa application directly on MakeMyTrip through this feature as well.

Early results show strong engagement on the listing page, along with a positive impact on both conversions and visa attach rates. Our accommodation business, which includes hotels, homestays, and holiday packages, delivered a strong 20.3% volume growth year on year. Growth was driven by strong demand for leisure travel with the highest ever check-ins recorded on December 25th, with wedding season demand and MICE events. The reduction of GST on hotel rooms under the rupees 7,500 category has also been a catalyst for the growth. We have seen a surge in booking volumes in this segment as customers responded to attractive pricing.

It is important to note that this has led to a divergence between volume growth and gross booking value growth. The gross booking growth is more moderate as it reflects the lower tax component in the final price paid by the customer. Lower GBV growth is an arithmetic consequence of the tax change and not a sign of any weakness in the segment. We continue to drive deeper penetration into India. We now have 97,000 plus accommodation options available on the platform covering 2,050 plus cities in the country. We are also driving online penetration in this segment with strong demand coming from tier two cities and beyond.

During the quarter, we sold properties in over 1,950 plus cities across the country, with almost 100 plus new cities selling for the first time in the last twelve months. On the product side, we have made GenAI-led interventions across the top 25 international cities, including prominent international beach destinations, to power beachfront discovery for beach holiday-seeking travelers. We are also using this knowledge graph information to determine and introduce clear beach proximity tags, like on the beach, beachfront, short walk to beach, on listing pages, thus improving discovery and conversion. In addition, for women travelers, we now feature women-specific ratings, AI-generated review summaries, and safety scores derived from female travelers to support deep information-seeking behavior.

By adding specific safety indicators and top-rated by women filters, we are building a confidence-driven ecosystem for a segment that travels 25% more in groups. These features are already live across 100 plus cities and 33,000 plus properties. This comprehensive approach ensures that the growing number of women travelers can explore with predictability and trust. Our holiday packages business witnessed strong seasonal performance as well. During the quarter, we successfully operated MakeMyTrip chartered flight packages to Phu Quoc in Vietnam, thereby unlocking the potential in an unexplored destination for our outbound travelers. This reinforces our belief that direct connection along with simplified visa process help open new destinations very well. The Philippines, for instance, is another such recent example.

Our homestay business continues to scale well. During the quarter, we sold 27,600 plus unique properties covering over 1,050 plus cities. This business now contributes early double digits to the overall hotel volume. Our bus ticketing business witnessed strong growth in Q3, aided by festive and holiday travel with all regions growing in double digits. Inventory addition remained buoyant throughout Q3 fiscal year 2026, with private inventory crossing 45,000 daily schedules by the end of the quarter compared to 40,000 daily schedules during the same quarter last year. During the quarter, we strengthened our cross-sell strategy by introducing unified inventory on the rail search page, enabling rail users to discover available buses on their search routes.

On our Southeast Asia Red Bus platform, we partnered with Grab to integrate intercity bus and ferry bookings into its platform, providing more options and making travel more convenient for users. Our corporate travel business, where both our platforms, MyBiz and Quest2Travel, are witnessing strong growth on the back of new customer acquisition. Our active corporate customer count on MyBiz is now over 77,500 plus, compared to 64,000 customers during the same quarter last year. And for Quest2Travel, the active customer count has reached 539 large corporates compared to 493 customers in the same quarter last year. You would recall that we had acquired travel expense management platform, Happay, at the start of the year.

I am happy to report that our integration with Happay is now complete, with flights and hotels resulting in Happay becoming a complete travel and expense management solution now. With this, let me now hand over the call to Mohit for financial highlights of the quarter.

Mohit Kabra: Thanks, Rajesh, and hello, everyone. The highlight of the quarter was our strong performance in October and November, wherein we capitalized on the improved sentiment by launching a first-of-a-kind festival travel sale called Travel Kamhurat Seed. It saw the widest travel participation from our suppliers across travel services as well as our non-trade partners. It helped us engage with our 75 million users during this same period of about thirty-three days. It also helped us build significant advanced purchase behavior, particularly for the upcoming peak holiday travel in December. It also helped us mitigate the impact from the low light of the quarter, which was the disruption of flight operations, particularly during the first fortnight of the December month.

This significantly impacted travel plans and bookings during that period. While the situation has now stabilized, complete supply recovery is likely to get pushed out into the next fiscal year. We are pleased to report that despite the disruption in the month of peak seasonality, we were able to drive strong performance overall for the quarter. Moving on to our segment results, our air ticketing adjusted margin is $207.9 million, registering a year-on-year growth of 20.4% in constant currency. Robust performance was driven by strong growth in the international air ticketing business, which now accounts for about 43% of the existing margin within the ticketing segment.

In the domestic air market, while the industry grew by just 0.9% year on year, we were able to deliver 2.2% year-on-year growth. On a flown basis, we saw slight market share gains, with our share now increasing to just over 31% during the quarter. On the hotels and packages segment, we recorded strong volume growth of 20.3% year on year, with standard hotels growing even faster at 20.6%. This was largely on the back of strong demand aided by the recent rationalization of GST rates for hotels priced under 7,500, where the GST rate has been reduced from 12% to 5%. This has resulted in strong room night growth of over 23% in the non-premium price segment.

As a result of this mix shift, as explained by Rajesh, we saw a slightly neutral gross booking growth year on year at about 15.9%. The adjusted margin in the standalone business was in line with the GMV growth. It is encouraging, this tax rationalization initiative of the government of India has had a positive impact on driving up volumes in the hotel segment. The mix of international hotels and packages revenue has also increased to about 24.2% in the quarter compared to about 23% during the same quarter last year. In our bus ticketing business, the consistent margin stood at $42.4 million, registering a strong year-on-year growth of over 26.1% in constant currency.

Our ancillaries business, which is part of the other segment, is scaling up well. This is helping us get a larger share of the wallet of our customers by building the attach of a variety of ancillary services. As a result, the adjusted margin from the other segment came in at $27.5 million, witnessing a strong growth of 45.5% year on year in constant currency. Moving on to the expenses side, most expenses have come in line. Marketing and sales promotion expense for the quarter was at 5.6% of gross bookings, again, in line with high seasonality and improving mix coming in on the back of strong growth in higher margin segments like hotels and packages, bus ticketing, and ancillaries.

This improvement of the mix is also translating into marginally better profitability overall. The adjusted operating margin has improved from 1.76% of gross bookings during the same quarter last year to 1.82% of gross bookings during the current reported quarter. We are glad to report our first $50 million plus adjusted operating profit updates in the quarter, with the actual number standing at $50.7 million. The non-cash interest cost on our zero-coupon convertible bonds for the quarter was recorded at $28.3 million, and the translation-related foreign currency losses in view of the rupee depreciation stood at about $5.3 million. Our reported net profit for the quarter was $7.3 million.

The adjusted net profit came in at about $51.4 million, with adjusted diluted EPS growing by about 33% year on year. You would recall that as part of our capital allocation strategy last quarter, we had increased the size of our buyback plan to $200 million and also included the recently issued 2030 convertible notes in the repurchase plan. We have repurchased 550,000 shares for an aggregate amount of approximately $41.5 million during the quarter. We also repurchased 2030 notes with a principal amount of $5 million for an aggregate amount of approximately $4.6 million. Accordingly, the total utilization for the buyback program was about $46.1 million, which has been our highest in-market buyback to date.

We ended the quarter with cash equivalents of over $100 million. We continue to dial up investments in core growth capabilities like AI and other organic initiatives while scouting for potential strategic investment opportunities. With that, I'd like to turn the call over to Vipul for the Q&A.

Vipul Garg: Thanks, Mohit. All the participants will now have the opportunity to ask a question from the management. Anyone who is willing to ask a question can click on the raise hand button on their screen, and we will take the questions one by one. The first question is from the line of Aditi Suresh of Macquarie. Aditi, you may please ask your question now.

Aditi Suresh: Well, thank you for the opportunity. So two questions. The first is on the standalone hotels segment. There's clearly been a very strong acceleration in your number of hotel room nights booked. Could you further break down that by maybe a premium segment, the budget segment, and also in terms of the growth you're seeing there? And then in relation to that, are there any changes to the online take rate you're seeing as this mix is changing?

Mohit Kabra: Thank you. Maybe I can take that. Like I just called out, the whole GST rationalization, which came in September, was expected to be a tailwind for growth in the hotel segment. And we have actually seen this coming through. While our overall standalone hotel room nights have grown at about 20.6%, the room night growth in the non-premium segment, which is the budget to mid-pricing, has been much stronger at about 23% year on year. So we clearly saw that benefit coming through. In terms of overall margins, I think our margins have largely stayed in line at about 17.7%. So there's no real significant change in the margin structure per se.

Like we've been calling out, we want to keep the margins in the high teens category, and we're pretty comfortable in having a stable regime on the margin side.

Aditi Suresh: Thanks, Mohit. And then the second piece is on ancillary services. Here you're seeing really strong revenue growth. Is it now possible for you to quantify the underlying margin you're seeing here? Because I assume that a lot of this is just a lockdown to EBITDA. Please talk through and give us any color on the underlying margin for the growth you're seeing in ancillary services. Thanks.

Mohit Kabra: Sure. The growth in the other segment or ancillaries has been a continuing trend if you look at it over the last few years. It is also coming in from the fact that we have been adding a lot of new services on the platform over the last few years. Over a period of time, each one of them is scaling up well. Just to give you an example, a couple of years back, we were running the capacity cap segment, dialing up the input transfers. We have started dialing up rail ticketing, particularly for the high-speed air-conditioned trains. There, our market share has gone up closer to about 4-5%.

Apart from this, we've also been adding a lot of non-transport ancillaries, whether it is buy-side insurance, forex, sponsorships, and ad tech on the platform. Visa service is something that I just called out. All of these put together, we believe, and this year, we also added a new segment of tours and activities. This is interesting because a lot of these travel customers book their core travel bookings with us, but there is a requirement for in-destination services as well, largely on tours and activities. Building that on the platform helps us retain them even for these services with us.

With this increasing spread of other travel or travel-related services, which we are going on adding, we do believe that the other segment will keep delivering good growth for us. At some point in time, maybe five to seven years down the line, some of these segments could become meaningful to be reported on their own basis. But, yeah, there are some segments that are more transport-related, and there the margins are in line with the industry. For some of the others, there's a significant fall down to profitability. When we look at profitability, we largely look at it at a platform level and therefore report margins at a segment level but report expenses and profitability at a platform level.

Vipul Garg: Thanks, Mohit. Thanks, Aditi. The next question is from the line of Sachin Salgaonkar of Bank of America. Sachin, you may please ask your question now.

Sachin Salgaonkar: Thanks, Hi, management. I have three questions. First question, a follow-up to Aditi's question. Mohit, when we look at the year-on-year growth in the hotel business, it was 17% last quarter. It's now 9%, which has gone below 10% this quarter. I understand the impact of GST. Also understand the impact of rupee depreciation. But, you know, how to think about it? Is there some kind of a one-off out here? How should one think about a normalized growth from this business? This business was growing at 20 odd percent plus in previous quarters. So, you know, do we see the growth resuming back to that number? Should I say all three questions, or should I take one by one?

Mohit Kabra: Yeah. Sorry. Let me just explain this a little better. Because there's something which is more like a one-off starting in this particular quarter onwards. Right? Because the GST rationalization almost happened at the end of the previous quarter. It's important to explain this. At a very high level, if you really look at it, we have reported more than 20% growth on the volume side. Now if you look at the price segment, which is below 7,500 rupees, there's been a GST reduction of almost 7%. And almost two-thirds or 70% plus of our volumes come from this particular price segment.

So roughly a blended impact of about 5% plus goes through purely on account of the GST-related impact on the gross booking value. Therefore, like I said, gross booking growth year on year in constant currency has actually come in at about 15.8%. If you factor in this additional 5% impact, which came in on the GST side, then our growth actually pretty much remains in line with the volume growth. So I thought I'd just share the overall impact with the GST rationalization. Otherwise, there's no real one-off impact. It's just that we had a different GST rate in the previous year, and on a year-on-year basis, this looks slightly different.

Sachin Salgaonkar: Sorry, Mohit. If I may just ask you to clarify. I heard you saying 9% number somewhere. Which number are you referring to?

Sachin Salgaonkar: So, Rajesh, I was referring to the reported hotels and packages revenue, which is $133.2 million. In Q3 2025, it was $121.9 million. So it sort of implies a 9% year-on-year growth.

Mohit Kabra: No. That's true. And, you know, therefore, I was just trying to bake in the currency impact as well. In calling out the constant currency growth.

Sachin Salgaonkar: So no. I get it. You know, Mohit, now that we end up seeing numbers on a reported currency basis, going ahead, we should sort of look at a similar kind of growth, sliding from these levels. Right?

Mohit Kabra: Absolutely. Absolutely. At least for the four quarters, now, beginning this quarter that we reported, this GST impact would be there. Constant currency impact would largely be dependent on how the currency plays out in the coming quarters. The GST impact would largely remain on these lines.

Sachin Salgaonkar: Got it. Second question on Indigo. We all know they've been asked to cut 10% of capacity. General checks in the market indicate that, till date, other airlines have not been able to fully offset that capacity impact. So as we head into calendar '26, how should we look at the domestic air traffic growth for the industry? Do we see that normalizing, or do we still have a bit of an out there for the full year '26?

Rajesh Magow: So maybe I can take that, Sachin. Yeah. This particular disruption was not even factored in. It came from nowhere, to be honest. Because these rules were always there. But, you know, I don't think anyone anticipated that this would cause this kind of a disruption. And therefore, the reduction of supply will happen and largely happen with Indigo because that's the largest airline in the market. Now our sense is that at least the estimates that we see basis our conversations, while things might have just from a disruption standpoint stabilized, in this running quarter, JFM quarter, it should come back to, again, the positive territory.

I'm talking about daily departures getting back to, because December, it was negative growth of minus 5% on daily departures on an overall basis. The estimates are now suggesting that it should be back to the positive zone, albeit at a flat or a one or 2% year-on-year positive growth. As things progress and more we get out of this particular issue where the rules settle down, the pilots come on board, etcetera, slowly and gradually, this will continue to keep improving. Outside of this, nothing else changes. Because the new plane schedules, whichever were coming, the supply that will continue to keep coming.

We also learned that even with Air India, the refurbishment of the planes is also happening at an accelerated pace. Along with the fact that they also keep getting new planes on a regular basis as well. That is likely to continue. So I think the overall picture, in all fairness, will be more clear, I would say maybe the next seasonal quarter. Which is April, May, June quarter, when the summer schedules are filed, and I think we will be in a better position to see overall what kind of supply schedules are being filed factoring in this temporary issue because of the new rules on flight duty travel for pilots.

And the new infusion or the refurbished planes that are coming in. So I think we'll have to wait net one more quarter, and I've already given you this quarter's sort of estimates that the industry is talking about.

Sachin Salgaonkar: Thanks, Rajesh. And my third question is on generative AI, maybe two parts to the question. One, would love to understand the feedback on Myra since you guys launched. And second, in a market like the US, we're actually seeing Google and ChatGPT launch their generative AI on travel. Now, hopefully, and subsequently, perhaps at some point, it might come into India. So as and when that comes, how should we think that from a MakeMyTrip perspective? Is it a new competition for MakeMyTrip where consumers now have an option to go towards these LLMs and book their ticket? Despite the fact that at the back end, fulfillment perhaps could be done by, let's say, MakeMyTrip only.

Rajesh Magow: So let's talk about that. Firstly, progress on Myra. Very encouraging, I must say. In fact, some of that I was sort of mentioned in the script as well, but I'll give you more color. There are a few metrics that we've been tracking. One is how the interactions, the number of interactions are growing. So from, let's say, a couple of months ago, about 20,000, 25,000 a day, we have now touched about 50,000 interactions a day, not transactions a day, but interactions a day on Myra. Which is, you know, two times growth in two months. And, you know, we are sort of seeing pretty much day on day, week on week growth on that.

So clearly good traction coming up. And then on the quality metrics side, we also measure what we call as good conversation and also the quality score of the interaction. And that is also progressively improving. So we now have a quality score of about 3.9 on a scale of one to five, and about 72% of the conversations are good quality conversations. So it's not like just to give you a sense of what the good quality conversation is, that the interaction is happening with more and more back and forth sort of question answer. Rather than just asking a sort of a 30,000 feet level query and then just going off the interface.

And that number is about 72%. The other two very important and encouraging metrics that we are tracking, one is, and that was one of our hypotheses as well. One is about the new users. So we are seeing out of these 50,000 interactions about 20% interactions are happening from the new users never transacted before. And that is largely coming from tier three, tier four cities, which is exactly what we were sort of aiming to get. You know, where the voice bot is being largely used. In vernacular language or the spoken language that consumers prefer. Coming in from whichever city, whichever state that they're coming from.

So and then last but not the least, I would say, which is sort of will be a perfect segue to your second part of the question, that the trip planning part, because that was another thing that, you know, the OTAs had not really been globally focusing on the top end of the funnel, which is the trip planning piece. On Myra, we have seen at least about 23 or 24% of the interactions are related to more trip planning and not necessarily immediate travel. So all these metrics are pointing towards quite promising, encouraging sort of trends, and we will continue to keep monitoring.

And in parallel, obviously, we are working very hard to further improve the product as well. So that journey is also in progress. Now coming to your point on, you know, what Google might have launched in North America, and when it comes to India, etcetera. You know, our take is as follows. What is happening is, like I just mentioned earlier, that as far as transactions and fulfillment and the kind of traveler who's willing to, who's made up his mind or her mind and coming to, you know, just to book the transaction and get done with it. I don't think that is going to get anyway, sort of potentially disrupted.

And trip planning was the piece which was not being done by OTAs in any case. Right? So then it remains to be seen. That if they launch, let's say, their own GenAI tool for trip planning, you know, whether they will attract more traction. And I think in all probability, there is a possibility that they will attract traction and that the customers from conventional search will move to using AI tools for doing trip planning. And to my mind, there's a large part of that is going to be share shift happening from a conventional search to the AI tools.

But our counter to that to an extent, will also be our own GenAI tool for trip planning as well. But the thing to watch out for will be, you know, how do we sort of continue to keep protecting our direct traffic, which is, you know, the majority of that is on our app, as you know. That they continue to keep coming to us directly. Or we end up sort of, you know, keep growing that direct traffic as a percentage of the overall traffic.

And the share of the paid traffic from any of these, you know, sort of new avatars of the search engines, we don't end up sort of increasing the share of the paid traffic from there. I don't really see, at least at this point in time, this is our conversation and this is, you know, the kind of development that has happened, including the development that is in progress. That there is anyone who is trying to talk about, you know, getting to really deep in the funnel and also looking at even the fulfillment, post-sales activities, etcetera. Because those are the modes that will continue to stay with the OTAs.

I think trip planning is the only piece where, you know, there is definitely a possibility given the richness of the data that they will have based on the LLMs. That they might get more traction. But the counter to that for that will be our, you know, sort of live to date customer base and the direct traffic contribution that we already have. And, you know, how powerful and popular is the brand that, you know, MakeMyTrip and RedBus are. And are we able to sort of protect that progressively or not.

So our sort of energies, investments, resources are channelized towards that as we continue to watch this space and then accordingly sort of, you know, if we need to tweak our strategies as we go along. We are seeing this as more, you know, sort of the overall, I called that out as well specifically. As more opportunity than threat. And I don't think and, you know, even in the conventional search, you know, sort of space, this debate was always that, you know, whether Google is our competition or Google is the competition for OTAs and all, OTAs or not, and I don't think and that debate might still come back.

But the reality is that, you know, like in the past, I think there are clear distinct modes and their advantages that the OTAs bring to the table. And I think they have a very clear and distinct sort of objective and the business model that the horizontals or the generic search engines have. I'm not sure that even with this evolution of new technology, there's going to be a significant overlap going forward either.

Sachin Salgaonkar: Okay, thanks for the detailed answer. Very clarification, Mohit. We saw the NCLT approval for MakeMyTrip and the RedBus merger, which in a way sort of removes any legal or overhang from a potential India IPO point of view. So any revised timelines should look from an IPO point of view? That's it from me. Thanks.

Mohit Kabra: Not really. I think, you know, should we kind of think of that? We'll come back separately. This, as you know, we have been in this restructuring process. A couple of years back, we had done a legal entity restructuring wherein we got the OTA businesses to come together. And now all the key operating businesses have been brought under a single legal entity. But, yeah, it does facilitate an eventual IPO at some point in time. To that extent. But no real change in thought process over there.

Vipul Garg: Thanks, Sachin. The next question is from the line of Manish Adukia of Goldman. Manish, you may please ask your question.

Manish Adukia: Thank you, Vipul. Hi. Good evening, team. So wanted to just go back to the growth discussion we were having in the early part of the call. So I understand, Mohit, what you explained and then the volume being strong, 20% plus, and GBV, 15% because of GST. Why should revenue growth get impacted? Do you get paid from the hotels based on the GBV or the actual revenue that they recognize? And I would have imagined that if growth is faster in mid to premium, sorry, mid to budget hotels, technically, your take rate should expand because you typically would have higher take rates in mid to budget compared to, you know, premium hotels.

So I'm unable to reconcile the revenue slowdown. I understand GBV slowdown there, but I'm unable to understand the revenue bit. So if you can just explain that, that'll be helpful. That's my first question.

Mohit Kabra: Yeah. No. Just to repeat it, Manish. The idea, if you really look at our margins largely coming on the booking value. Right? And therefore, the impact in a manner of sort flows both into the booking value as well as into the overall margin absolute margin that we get. So the percentage doesn't change, but the absolute margin that we get gets impacted as well. But I think like we have been calling this out even last quarter, when this change had come in, we were calling it out as a significant positive because this just helps unlock volumes or demand particularly at the price point, which is very sensitive. Right?

Customers are pretty price sensitive in the mid to budget segment. And therefore, this is an important unlock. And therefore, if you really look at it, the growth has actually accelerated very nicely through this quarter. In fact, not just only in hotels, but across segments. Despite domestic air being at a very marginal growth for us. And for the industry. Our overall segment growth across all segments that we report also stood at about 22%. So I think I'm kind of more taking encouragement from the fact that this segment growth or the volume line growth continues to be strong. The rest is largely a play out of the changes in the landscape.

And they will get normalized over a four-quarter period.

Manish Adukia: Very helpful. And your air growth, of course, in the quarter was impacted by what happened with Indigo. Hotels were extremely strong, partly driven by the GST cut on volume. But would the hotel volume growth, in your opinion, have been even faster without the Indigo disruption? Like, I mean, I'm just trying to think that here on, even on volume, is there room to accelerate in the foreseeable future?

Mohit Kabra: Needless to mention, you know, Manish, actually, flights is a lead indicator. Right? It kind of if you look at the entire travel plans, for most Indians, they start with a flight booking. And then everything else follows. Right? So I think what we are trying to do is that whatever is the significant adverse impact coming in from the disruption on the flight side, to a large extent, we are trying to mitigate it through modes of transport. And therefore, if you see, we have been dialing up or seeing good growth on the bus ticketing side, also on intercity cabs, etcetera. So I think the clearly, could have benefited with the only description on the flight side.

And if I really look at it, very briefly, in terms of how the growth has panned out, between the months during the quarter, clearly, December was a month of much slower growth for us. And therefore, again, indicates the same. So it would have helped, but I think given the circumstances, the hotel growth was very, very encouraging.

Manish Adukia: No. Absolutely. And just a couple of other follow-up questions from earlier. On the overall spend on marketing and promotion at 5.6%, one of the highest we've seen in recent periods. Is there, like, some bit of, like, one-off there? I mean, should it go back to the sub-five number you in the past indicated? And, again, is that a function of the fact that, again, when budget or mid hotels grow faster and they probably have a higher component of promotion that impacted us. So I just want to understand the outlook also on that number, and then just have one last follow-up question after that.

Mohit Kabra: Yeah. Yeah. Absolutely. No one-offs. In fact, two parts to it. You know? One, I would say, is the very fact that low margin businesses like air ticketing have seen an adverse impact on growth. Right? And therefore, the growth has come in predominantly from higher margin businesses. Now what that means is clearly, you're getting a much better improvement in the blended margin for the business as a whole. So if you were to look at adjusted margins across segments, and then look at it probably as a percentage of gross bookings, then it would look much more healthier. The customer acquisition cost also. So it's completely linked to the mix shift.

And then within that mix shift, there's also the fact that there's slightly more accentuation towards the mid to kind of mid segment of hotels, where, again, the customer acquisition cost tends to be slightly higher. So I think purely reflective of the mix, and therefore, if you really see despite the 5.6%, there's no impact. In terms of the adjusted operating number. That continues to be 1.8% plus as a percentage of gross booking. So wanted to call that out. And it's very difficult. Like I said, the mix and the blended margins were very different, say, until about a year back. And which very different, you know, in this one-year period.

Due to these, you know, one-offs that have got paid out.

Manish Adukia: Thank you. And maybe just my last question, taking a step back and looking at the overall business, 20% constant currency revenue growth in the quarter, which was a fairly noisy quarter, which in my opinion, is a very good outcome. When we think about, let's say, over a one to three-year outlook, when it is it fair to say that to deliver 20% growth you have to continue to reinvest in business and margins don't expand, which means over a period of time, your EBITDA growth broadly tracks revenue growth. Because I would have thought that in a country like India, if revenues are growing at 20%, operating costs probably grow at a lower pace.

Is that something that may not play out? I mean, is it not an operating leverage story anymore? And margins will largely be in line to where they are? Or how should we think about the growth outlook versus the EBITDA growth outlook, revenue growth versus EBITDA growth? That's my last question.

Mohit Kabra: Sure. If you look at it over the last five, ten years, we've clearly called out a substantial portion of the margin improvement that was supposed to come in leveraging volumes and leveraging penetration, building in a market leadership in each of the segments of the business, that's largely played out by 2024. Right? So and thereafter, we have been calling out that in our customer acquisition costs are actually pretty efficient right now. We don't really look at dialing them down. We'd rather keep focusing on dialing up growth. And looking at growing in the twenties. And that opportunity is getting delivered despite the market growth coming down very significantly. At least in this year, right, across quarters.

So I think the last part of our objectives in setting the mix where we are. So say, for instance, where the accommodation mix is still in the forties. Right? So till the time we remain in the forties and say, closer or the sub 50% mark, we do believe our adjusted operating margins are pretty healthy. I've always given the example of the global players and how their best-in-class margins play out. And if you just superimpose our mix over there, this margin percentage looks very healthy. So I think we will really need now the mix going beyond the 50% mark. For any significant improvement on the adjusted operating margins to play out.

Until then, I think the operating leverage will likely come in more from the more fixed than variable cost. Which again is very small. So in our case, the fixed costs are just about, probably, like, about 20, 25% of the overall expenses. And therefore, the improvements are going to be much smaller in nature. In line with what we have seen in the last two years or so compared to what we have seen in the five years before that.

Manish Adukia: Very helpful. Thank you, Mohit, for answering my questions. All the best.

Mohit Kabra: Thank you.

Vipul Garg: Thanks, Manish. The next question is from the line of Vijit Jain. Vijit, you may please ask your question now.

Vijit Jain: Yeah. Hi. Thank you. So my question, you know, in the hotel segment, with the GST cut, did demand somewhat shift also from higher ticket size to sub 7,500 category? And within that, given that, you know, you even called out that growth did accelerate here. So is that because, you know, in general, you have better selection in that and therefore some market shift? Market share shift might have happened from others or from offline or other channels to you. Is that something that happened here?

Mohit Kabra: We as you know, on the premium side, we pretty much have all the hotels that are available in the country on the platform. So most of our expansion actually keeps happening more in the mid to premium or more in the mid to budget or more in the budget segment. Right, from a price point of view. Where we keep adding more and more hotels on the platform. Because there's a much larger number of hotels in that particular price point, which still need to be contacted and put on the platform. For maybe new hotels which come across all price points. So that improvement in the booking of offerings in the budget segment will keep increasing.

No doubt about that. But this is more, I think, what we saw during the quarter was more on account of the significant price differential, which is now emerged. The sub 7,500 versus, say, the 7,500 to 9,000 or 10,000 price range because there's suddenly a significant impact coming in from the steep change in the GST rates. So that's seeing a lot more of the volume coming through in the sub 7,500 price range. In fact, a lot of the hotels who were on the marginal side, just about the 7,500 price, would have also wanted to bring the prices in line for the overall customer benefit to play out.

So that's what's playing out, and that's what we've seen. Largely on expected lines. And like I said, there has been a little bit of a share shift from a volume point of view we've seen roughly about 2 to 3% shift happening from premium, super premium to maybe more like the mid to budget segment. And, again, on the overall mix also, roughly about 4 to 5%, whether in terms of gross booking value or in terms of adjusted margins. So yes. But this is very much on expected lines. Like I was saying, the real underlying benefit of it is it's really helped unlock demand in the overall hotel schedule.

Vijit Jain: Got it. Thanks, Mohit. My second question, just reflecting on your comment earlier, Rajesh, on generative AI and LLMs and those things. I'm just wondering if trip planning is what moves to LLM. And trip planning is the arguably on search versus LLM. LLM offers much better. Does that mean that it could accelerate further your online shift in categories like international or other packages and stuff where traditionally, people have used agents because it's complex and make it easier. Could that conversely actually help online shift in India?

Rajesh Magow: No. I think it's an interesting take, Vijit, I must say. Quite possible. See, listen. In any case, overall, across the categories, not necessarily on travel and within travel also, all segments directionally going in that direction only, from offline to online. And, you know, can we say that the digital agents tomorrow or even on the trip planning when it is becoming more popular, I don't know whether the trip planning per se because, you know, I could also argue that even, you know, historically, the people were going to Google and searching and doing some bit of trip planning there, right, or going to TripAdvisor to do some trip planning.

Specifically or coming to OTAs to do some part of trip planning, etcetera. I'm I don't know whether that per se will trigger this shift. But I think what is potentially what can potentially trigger is actually what we have built. Which is Myra is a digital agent because it is in because you can ask the question in your own language that you are comfortable. And you can look for complex itineraries, ask as many questions as you want, and you will get accurate answers. Then along with that, the booking will also be stitched. In a very smooth manner. That might actually help.

Because the hypothesis is that, you know, you're going to a travel agent or human travel agent to ask for help specifically for customization. Right? And now you can achieve that customization on a digital agent as well. Almost as effectively, if not better, as you would do it with the other alternative, right, so that you were doing it or you were it earlier. I think that might actually help do the shift or accelerate the shift better. I'm not sure. Only trip planning.

The only trip planning where trip planning could help is that where overall sort of inspiration for travel goers, because if that, in any case, is the consumer behavior is changing and spending more and more on travel in any case. So you go on your preferred either the social media channel for inspiration and then come to let's say, horizontal search or and or an OTA like MakeMyTrip to do trip planning and you find it easier and smoother, domestic or an easy travel use case or a complex travel use case. That potentially can definitely help.

But specific to international travel, I think unlock might be the digital agent mode, which is answering all the and also stitching the booking experience together. Put and also post-sales and in-trip in a single interface, that might actually help trigger that shift.

Vijit Jain: Alright. Thanks, Rajesh. And my last question, on the total marketing spend, which I think to Manish's question earlier, you mentioned how mix shift has contributed to it rising to 5.6. So as air recovers maybe from the summer season onwards or maybe even marginal recovery in the March, does it trend? Does your total spend trend back towards what you've previously said, five to 5.5%?

Mohit Kabra: Most likely, Vijit. It should start reflecting the mix. Because, like I said, there's nothing in terms of a one-off over here. And therefore, it should start to play in the mix depending upon what kind of changes we see over there.

Vijit Jain: Got it. Thanks, Mohit. Those are my questions.

Vipul Garg: Thanks, Vijit. The last question we will take from the line of Gaurav Rateria of WFM. Gaurav, you may please ask your question now.

Gaurav Rateria: Hi. Thanks for taking my question. So just a couple of questions. One is the net take rate on air is about 7% this quarter, 7.2% last quarter. Is that a normal number, or is it running higher than a normal range of, like, six and a half or so?

Mohit Kabra: Yeah. I think, you know, we generally tend to range around this mark. It can be about half a percentage point lower or higher depending upon what kind of phase of prevailing, depending upon the kind of lag between booking versus flown, etcetera. So nothing exceptional over here, Gaurav.

Gaurav Rateria: Okay. Got it. And then the second question is going back to the hotels and packages business. So when we think of the constant currency bookings growth of fifteen, I think you explained it as volume growth of 20 and then five points of impact from GST. But then apart from volume and GST impact, there's also pricing. With all these hotel companies report, like, pretty decent ADR growth. So for you, the price net pricing growth is, like, zero almost. Right? So I guess there is some price growth and then negative mix impact. Which is canceling each other.

But if I just think about going forward, let's say, next one year where you mentioned for the next four quarters, this GST impact will hit you. Are we thinking of broadly an algorithm where your constant currency GBV growth will be, like, five percentage points below your volume growth like it was this quarter, or does that gap sequentially keep reducing? Maybe if I can share a one-year view as well as a two, three-year view. That'll be helpful.

Mohit Kabra: Directionally, it is only just a one-year impact because the comparable number for the previous year is at a different GST rate. So therefore, it's just more of an optical thing than anything actually impacting the business. So this is more optical and don't see any real impact as such over here. Sorry. I missed the first part of the call. Question, what was that?

Gaurav Rateria: Yeah. I got that, Mohit. Maybe I'll just quickly address that. And then just Gaurav, to your point on hotel companies reporting higher price rise and all, you should just be mindful of one thing. See, what you are looking at, it is only a few data points. Like, let's say listed companies reporting some, and, again, their ADRs have also not significantly gone high. On our platform across the segments we are selling hotels. Right? And, you know, on a blended basis where there is a possibility in one particular segment in certain cities, some because of the demand-supply gap, etcetera, some price movement would have happened.

But as a general trend, on a blended basis, the segments, if we do and even if we sort of look at different segment hotels, whether it's a budget hotel segment or a mid-segment or a premium and then super premium kind of segment, we haven't really seen any price increase which is extraordinary or out of the ordinary now happening. So it's actually that era is over. It is actually pretty stable now, and you would only see either because of seasonality, there will be some movement or there will be an inflationary increase year on year. Right?

So I don't think we should jump to the conclusion that the average selling price for a room night across the board the rates have only gone up in pretty much every segment. I thought I'll just clarify that because, you know, on our platform, we also have, out of our hotel and packages business, about 10% homestays. Now homestays pricing and year on year, and across segments, and therefore, on a blended basis, it the border and pan India basis, if you would see, there is no significant price increase on the except for the seasonality impact that we've seen.

Gaurav Rateria: Got it. Maybe just one last follow-up on the domestic hotels business. So at least among the listed OTA players, we don't see anyone else having any meaningful hotel business right now. So at least in the domestic segment, is that a fair conclusion that there is not really much competition? And when we look at, like, the broader industry data, hotel, domestic plus international, there we see I guess you have competition from these global players. But let's say, least on the domestic segment, would it be fair to conclude that? You would be the one dominating and not one competition?

Mohit Kabra: Reasonably fair to say, but just keep in mind that in the overall online penetration in the segment is still in the early stages. So there's a long headroom over there. But fairly in the right direction.

Gaurav Rateria: Thank you. Thank you.

Vipul Garg: Thank you, Gaurav. For in the interest of time, this was our last question. We'll now hand over to Rajesh for his closing comments.

Rajesh Magow: Thank you, Vipul, and thank you everyone for your patience. We look forward to seeing you next quarter.

Vipul Garg: Take care, everyone. You may now disconnect the call.