By Maksym Misichenko · Yahoo Finance ·
What AI agents think about this news
The panelists generally agreed that MakeMyTrip's (MMYT) diversification into hotels, packages, and bus services has been successful, with resilient margins despite geopolitical headwinds. However, there's disagreement on the impact of AI initiatives and the OneCircle loyalty program on long-term margins and their ability to defend against intense competition.
Risk: The risk that air travel demand rebounds, leading management to reallocate marketing spend away from OneCircle and back to international segments, potentially starving the loyalty program of investment and undermining its moat.
Opportunity: The opportunity for OneCircle to structurally lift repeat rates and average order value (AOV) in Tier 2/3 cities through personalized loyalty loops, driving margin expansion even without a rebound in air travel demand.
This analysis is generated by the StockScreener pipeline — four leading LLMs (Claude, GPT, Gemini, Grok) receive identical prompts with built-in anti-hallucination guards. Read methodology →
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Wednesday, Aug. 5, 2026 at 7:30 a.m. ET
Vipul Garg: Good evening, everyone. Welcome to MakeMyTrip Earnings Call for Q1 FY '27. We will just give a minute for everyone to join. Okay. Hello, everyone. I'm Vipul Garg, Senior Vice President, Investor Relations at MakeMyTrip Limited, and welcome to our fiscal 2027 first quarter earnings webinar. Today's event will be hosted by 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 U.S. Private Securities Litigation Reform Act of 1995. These statements are not guarantees of the 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 the call over to Rajesh for his remarks. Over to you, Rajesh.
Rajesh Magow: Thank you, Vipul. Welcome, everyone, to our first quarter call for fiscal 2027. Before we go into the financial and operating details, I would like to put the quarter in context. This was a quarter in which external events continued to influence where and how customers traveled. The quarter began with the continuing impact of the West Asia conflict. In the initial phase, the impact was broad-based. Flight operations were disrupted and customers became more cautious about international travel, particularly on westbound routes. As flight operations gradually resumed, the nature of the challenge also evolved. Higher fuel costs and ATF prices translated into elevated airfares, affecting westbound international travel as well as price-sensitive domestic air demand to an extent.
Higher ATF cost also affected the profitability of airlines, leading to short-term capacity cuts. However, as we moved into the peak summer holiday period, we saw seasonality began to support the underlying resilient travel intent for leisure travel, whereas essential travel and business travel largely continued as uninterrupted, except for long-haul westbound business travel. International leisure travel saw some shift from westbound to East and Far East destinations and domestic leisure travel was a combination of popular leisure destinations and nearby short-distance getaways by road. Thanks to our comprehensive product offerings, we were well positioned to offer our customers alternative transport and accommodation options for their choice across both established and emerging leisure destinations during the quarter.
As a result, we delivered a strong performance during Q1 despite significant macro and geopolitical headwinds, reflecting both the resilience of travel demand and the strength of our diversified platform. Growth in hotels and packages and ground transport helped offset softness in air ticketing to deliver targeted adjusted margin growth and profitability. Both our bus ticketing and intercity cabs continue to grow at a strong pace, driven by sustained supply additions, wider route coverage and the continued expansion of India's highway infrastructure. We continue to curate pilgrimage plus leisure itineraries, short duration holidays and drive-down breaks. These formats are increasingly becoming popular for customers looking for convenient, affordable and experience-led travel closer to home.
The broader conclusion from this quarter is consistent with what we have observed post-COVID. Travel in India is gradually moving from an occasional purchase to becoming a recurring consumption category. Customers are taking more frequent trips across leisure, family visits, pilgrimage, short breaks and extended weekends. We have seen external events impacting the demand sentiment initially. But when macroeconomic or geopolitical environment starts to show some improvement, demand recovers quickly. This quarter was another validation of this behavior among Indian travelers. The long-term structural growth drivers also remain unchanged.
Growth in the aspirational middle class, increasing participation from Tier 2 and Tier 3 cities, expanding physical infrastructure and great digital continue to support the long-term positive outlook of the travel market in India. Let me now give an update on the progress we are making on our AI-first transformation. We view AI as a foundational layer across travel discovery, planning, booking, payments, servicing and loyalty. During the quarter, we launched Myra 2.0, the next version of our AI-powered travel assistant to enable end-to-end conversational booking within the Myra interface possible now.
Customers can now search, compare, ask contextual questions, upload documents and complete bookings, including agentic payments through a single conversational interface via text chat, voice-only chat or a combination of voice or text chat across 8 Indian languages. In the meantime, customer adoption of Myra being used as an assistant in the existing funnel continues to scale well. It has handled over 8 million conversations during the quarter, including more than 3 million conversations in June alone. Over 45% of usage came from Tier 2 and smaller cities. We believe conversational AI feature will continue to simplify and personalize travel planning, improve customer engagement and serve as a key long-term differentiator for our platform.
We are also expanding the use of AI and automation across customer support, content creation, supply onboarding and operational processes. These investments are intended to reduce friction in the customer journey, improve conversion and enhance organizational productivity. We're already seeing the productivity benefits of AI translate into our operations. AI now generates more than 75% of our code and our AI-powered customer support bot independently resolves over 50% of customer calls, meaningfully improving both engineering velocity and customer service efficiency. During the quarter, we launched AI-powered smart filters on the flights and hotels listing page to enhance discovery, enabling users to express preferences in natural language and instantly refine results using natural language instead of relying only on predefined filters.
Travelers can now search for highly specific preferences such as micro locations, early check-in, premium room amenities for hotels or exact baggage allowance, cancellation penalties, seat inclusions, layover preferences, et cetera, in case of flights, thus making discovery more intuitive and personalized for the customers. Looking ahead, higher oil prices and weakening of rupee remain important variables to keep overall travel inflation in control. We remain cautious about the near-term environment while staying positive about structural drivers for long-term growth in the sector. We will continue to navigate the near-term challenging environment by tapping into growth opportunities in our non-air ticketing segments while calibrating our marketing investments in line with market conditions.
With this, let me now hand over the call to Mohit for business highlights of the quarter.
Mohit Kabra: Thanks, Rajesh, and hello, everyone. As explained by Rajesh, this was a quarter in which the external environment remained challenging, which impacted our outbound and air ticketing businesses. We leveraged the resilient travel sentiment by focusing on domestic travel, drive down on short duration holidays and pilgrimage air travel, supported by our widespread offering across hotels and ground transport. This has helped us deliver strong growth in our hotels and packages business with adjusted margin growth of 21.3% year-on-year in constant currency terms. This was led by stand-alone hotel booking volumes growing just over 20% or 20.2% year-on-year despite the weakness on the international demand side. This was coupled with strong growth in our ground transport business.
Our bus ticketing business delivered strong adjusted margin growth of 22.4% year-on-year in constant currency, supported by strong volume growth of 23.9%. Similarly, our intercity cabs business grew in the 40s, albeit on a smaller base. This strong performance in an impacted quarter demonstrates the strength of our diversified and comprehensive bouquet of travel services, which is helping drive growth much ahead of the industry and also driving increased customer engagement. Our ability to serve multiple accommodation and transport options across price points allows us to ensure that we curate travel experiences customized to the budget options of our customers.
As customers book multiple travel segments on our platforms, we also gain better understanding of their travel preferences, and this helps us get better and better at offering more relevant, connected and personalized travel solutions. Let me share some more details on the holidays and packages segment. To drive the growth in hotels, we have significantly scaled up the breadth of stay options we offer in India to improve the coverage across destinations, price points and travel needs. We now have over 11,000 accommodation options available on the platform, covering over 2,070 cities in the country. We continue to innovate and solve for unique requirements of the Indian traveling customer.
To better serve families and travelers, we have made it easier to discover multi-bedroom properties along with better understanding of room layouts, which is resulting in higher booking confidence with more relevant room combinations being showcased during the booking process. We also launched probably an industry-first feature around guaranteed early check-in or guaranteed late checkout, a facility which is a paid feature enabling travelers to have assured room access aligned with their travel schedules right at the time of booking. This feature is helping address one of the most common pain points for travelers.
This is even more relevant for Indians traveling overseas as the landing or takeoff times for most of our international connections have a significant gap with the usual check-in or checkout times offered by hotels in those destinations. One of the long-standing pain points in the accommodation segment has been inability to optimize hotel reward programs, both for travelers as well as for accommodation service providers. As we entered the new fiscal year 2027, we're trying to address this with the launch of OneCircle. OneCircle is our cross-network hotel rewards program. Initially spanning over 13,000 properties across Indian and international destinations, OneCircle will enable travelers to earn and redeem rewards seamlessly across a large network of hotels, homestays and villas.
This will help them access wider array of properties on a single reward program, driving loyalty and repeat of stays across our accommodation ecosystem. Equally importantly for our hotel partners, OneCircle provides access to a broader base of loyal travelers, which can help drive both new always as well as repeat demand to their properties. We believe this will allow our domestic hotel partners to showcase their properties as well as drive demand, particularly from India's fast-growing Tier 2 and Tier 3 markets. For our international hotel partners, this will be of great relevance in cities which see high travel demand from India.
In Home, we continue to invest and build the category and are enhancing our product proposition to improve customer experience as well as drive the appeal of such properties. We launched our Star Host program to recognize and reward hosts who consistently deliver outstanding guest experiences. Hosts meeting defined quality benchmarks across guest ratings, responsiveness, booking performance and content quality are rewarded the Star Host badge, which is prominently surfaced across search results, property pages and host profiles to improve trust and discovery. The Star Host badge also helps customers spot properties from these hosts and book with confidence, particularly in case of new properties.
Our holiday packages business continues to scale well and we are witnessing a shift towards shorter duration and nearby gateways in line with the current market trends. On the outbound side, destinations across Southeast Asia and Far East are driving the growth charter. Leveraging on the opportunity, we scaled up our group tours to over 15 destinations and generated about 90 departures or operated about 90 departures across Vietnam, Singapore, Georgia, Almaty, et cetera. During the quarter, we continued to build our tours and attractions business by strengthening customer acquisition, expanding our experiences portfolio and investing in platform-led differentiation.
Our international experiences portfolio now spans across 1,100 cities, spanning 139 countries with a catalog of over 250,000 tours and attractions covering sightseeing, tickets, buses, performances, day trips, food experiences and unique local activities. Building on this portfolio, we have launched domestic experiences as well, spanning across 50-plus Indian cities, offering 3,000-plus products and strengthening our presence in a segment where we see significant growth potential in the future. This will help broaden our addressable market while strengthening our position as a one-stop platform for relevant travel experiences across both domestic and international destinations. 1/4 of our tours and activities are currently being bought while the customers are on a trip.
This highlights the strong relevance being built with the platform for our customers while they are on the ground and looking for last mile things to do. As mentioned, we delivered strong growth in our bus ticketing business, driven by robust growth in the private bus inventory in line with the summer holi
Four leading AI models discuss this article
"Diversified non-air growth and AI investments position MMYT to outperform industry despite near-term macro headwinds, supporting continued margin expansion."
MMYT reported resilient Q1 FY27 results with hotels/packages adjusted margins up 21.3% YoY (constant currency) and bus ticketing margins up 22.4%, driven by 20.2% stand-alone hotel volume growth and 23.9% bus volume growth despite West Asia conflict, elevated ATF prices, and rupee weakness crimping air ticketing and outbound travel. AI initiatives (Myra 2.0, smart filters, 75% code generation) signal long-term differentiation. Structural tailwinds from rising Tier 2/3 demand and recurring travel consumption remain intact. Valuation likely reflects premium for diversification beyond air.
The article glosses over sustained high oil prices and rupee depreciation potentially keeping travel inflation elevated longer than expected, risking margin compression across non-air segments if customers trade down further or defer discretionary trips; international exposure recovery could lag if geopolitical tensions persist into peak seasons.
"MakeMyTrip's transition into an AI-enabled, diversified travel ecosystem is successfully decoupling their profitability from the volatility of international air travel."
MakeMyTrip is successfully executing a pivot from a transactional air-ticketing platform to a high-margin ecosystem play. The 21.3% growth in hotel margins and 22.4% in bus ticketing, despite geopolitical headwinds, validates their 'non-air' diversification strategy. The integration of Myra 2.0 and the OneCircle loyalty program are critical; they aren't just features, but defensive moats designed to capture the entire customer lifetime value in India's fragmented travel market. By shifting focus to Tier 2/3 cities and domestic leisure, they are insulating themselves from the volatility of international air travel. If AI-driven operational efficiency continues to scale, expect significant margin expansion as customer acquisition costs (CAC) drop relative to lifetime value.
The reliance on domestic travel and 'drive-down' getaways may be a temporary defensive posture that masks a structural decline in high-margin international bookings, which are far more sensitive to the rupee's volatility and fuel costs.
"MMYT's Q1 beat masks a structural shift away from high-margin air ticketing into lower-margin hotels and buses, with AI productivity gains not yet translating to customer acquisition economics."
MMYT delivered solid Q1 FY27 despite geopolitical headwinds—hotels +21.3% adjusted margin, buses +22.4%, intercity cabs in the 40s. The diversification story is real: when air ticketing weakened (West Asia conflict, elevated ATF), ground transport and hotels offset it. Myra 2.0 handling 8M conversations (3M in June alone) with 45% from Tier 2+ cities suggests AI adoption is scaling. But the transcript conflates AI productivity claims (75% of code generation, 50% support resolution) with revenue impact—we don't see concrete conversion or AOV lift yet. Rupee weakness and oil prices are acknowledged headwinds, not resolved. The 11,000 hotel properties across 2,070 cities sounds impressive until you realize OTA saturation in India is intense; OneCircle is a loyalty play, not a moat.
Management is burying the lead: air ticketing—historically MMYT's highest-margin segment—was soft enough to require 'calibration of marketing investments.' If westbound travel stays pressured and domestic leisure normalizes post-summer, the diversification benefit evaporates and margins compress back to pre-quarter levels.
"MMYT stands to outperform on a secular Indian travel rebound and AI-led efficiency, but its near-term profitability hinges on a rebound in air-ticketing and stable macro conditions."
MMYT is presenting a narrative of durable, domestic travel growth in India, supported by a diversified mix (hotels, packages, bus/intercity cabs) and an aggressive AI push (Myra 2.0) that purportedly boosts conversion and efficiency. Notable metrics include hotels up ~20% YoY in volume, bus margin up 22.4%, and 8M Myra conversations with broad Tier 2/3 usage, plus loyalty initiatives like OneCircle and Star Host. The caveat: near-term upside hinges on air-ticketing rebound and favorable macro conditions (lower inflation, stable rupee, lower oil), while marketing costs and competition risk compress margins. Real earnings quality and cash flow depend on air-demand recovery and sustained AI-driven productivity beyond headline metrics.
The bullish case could unravel if air-ticketing demand remains weak or if marketing intensity escalates further; moreover, AI productivity claims may not fully translate into lasting margin gains in a competitive OTA market.
"OneCircle + Myra data loop creates a compounding moat overlooked by the panel."
Claude's skepticism on AI-revenue linkage is fair, but everyone underweights OneCircle's data moat. 8M Myra chats feeding personalized loyalty loops could structurally lift repeat rates and AOV in Tier 2/3 faster than marketing-cost offsets. If domestic leisure normalizes without air rebound, this flywheel still compounds margins where pure OTAs cannot.
"AI-driven support resolution provides a tangible margin floor that offsets the commoditization of loyalty programs in the Indian OTA market."
Claude is right to question the AI-revenue link, but misses the operational reality: 50% support resolution via Myra 2.0 isn't just 'productivity,' it is a direct reduction in variable opex, which is the only way to defend margins against intense OTA competition. While others fixate on air-ticketing volatility, the real risk is that OneCircle becomes a 'loyalty tax'—a necessary expense to prevent churn in a commoditized market rather than a genuine moat that drives pricing power.
"OneCircle's margin benefit is contingent on sustained air-ticketing weakness; if air rebounds, management's capital allocation shifts and the loyalty moat collapses."
Gemini's 'loyalty tax' framing is sharper than Grok's flywheel optimism. But both miss the timing trap: OneCircle's margin defense only works if MMYT can sustain 20%+ hotel/bus growth without air recovery. If air rebounds sharply, management reallocates marketing back to high-CAC international segments, starving OneCircle of investment. The moat isn't structural—it's cyclical. Grok assumes the flywheel compounds; I'd argue it only compounds if air stays weak.
"OneCircle is not a durable moat; Myra-driven opex savings alone won't sustain margins if CAC persists and air demand rebounds, making diversification cyclical rather than structural."
Gemini's case on 50% Myra 2.0-driven opex savings as margin protection is incomplete. Even with lower variable costs, OneCircle's moat depends on sustained high repeat purchases; a loyalty tax can become price competition, especially if CAC stays high or air demand rebounds and marketing shifts capital back to international channels. The result: margin durability is not assured, and diversification may prove cyclical rather than structural.
The panelists generally agreed that MakeMyTrip's (MMYT) diversification into hotels, packages, and bus services has been successful, with resilient margins despite geopolitical headwinds. However, there's disagreement on the impact of AI initiatives and the OneCircle loyalty program on long-term margins and their ability to defend against intense competition.
The opportunity for OneCircle to structurally lift repeat rates and average order value (AOV) in Tier 2/3 cities through personalized loyalty loops, driving margin expansion even without a rebound in air travel demand.
The risk that air travel demand rebounds, leading management to reallocate marketing spend away from OneCircle and back to international segments, potentially starving the loyalty program of investment and undermining its moat.