Q3 2025 MakeMyTrip Ltd Earnings Call
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Good evening everyone.
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Hello, everyone.
Vice President Investor Relations at make metric limited and welcome to our fiscal 2025 top quartile earnings slip at all today.
Today's event will be hosted by the company's leadership.
Baddish Model: Comprising baddish model, our cofounder and group Chief Executive Officer, and Mohit <unk>, Our group Chief Financial Officer.
Baddish Model: As a reminder, this lighter weight 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.
Baddish Model: Furthermore, certain statements made during today's event, maybe considered forward looking statements within the meaning of the safe Harbor provision of the U S. Private Securities Litigation Reform Act of 90 95. These statements are not guarantees of future performance are subject to inherent uncertainties and actual results may differ materially any forward.
Baddish Model: Looking information daily duty disobey speaks only as of this date and the company undertakes no obligation to update the information to reflect changed circumstances and he said 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 D. A.
Baddish Model: On July 2nd 2020 full copies of these filings are available from the FCC or from the company's Investor Relations Department.
Speaker Change: I would like to now turn over the call over to dish or to your knowledge.
Baddish Model: Thank you.
Speaker Change: Welcome everyone to our third quarter call book as good as 2025.
Speaker Change: Happy to start the call by shedding Ambac Indian travelers continued to demonstrate their eagerness to traveling.
And experience new horizons in the seasonally strong quarter for leisure travelers.
Speaker Change: Confluence of rising income limit and changing consumer behavior to spend a bigger portion of available discretionary surplus is driving the growth for both domestic and international tourism in India.
Speaker Change: And Sylvia by visa indicate that 62% over NIM can do mine planning to increase their spending on discretionary goods and services.
Speaker Change: These favorable macro trends combined with our focus execution have enabled us to outpace industry growth consistently we are pleased to deliver strong performance across all our business segments with an accelerated year on year growth rate of 26.8% and gross booking value in constant currency terms during the day.
Speaker Change: Good quarter compared to a growth vehicle created to appoint 9% during the first half of this fiscal year.
Speaker Change: Alongside accelerated bookings growth, we have also been able to drive operating leverage and the adjusted operating profit, which is at an all time quarterly high of $46 million has a history of year on year grow it off about 38%.
Speaker Change: On the macroeconomic front, India's GDP growth forecasts reflect a positive economic outlook driven by strong domestic demand and strategic public investments. The World Bank recently said that India's growth is projected to remain steady at 6.7% <unk> for the next two fiscal years.
Speaker Change: Beginning April 2025, making it the fastest growing largest economy in the world.
Speaker Change: India is undertaking significant investments in infrastructure to avoid stood at normal economic growth and achieve developmental objectives travel infrastructure comprising roads Railways and airport infrastructure is a pivotal part of these investments, making point to point travelers seamless convenient and reliable.
Speaker Change: The seamless connectivity has been one of the major reasons for the growth of travel and tourism in India and will continue to drive growth in the future as more and more domestic and international destinations get connected.
Speaker Change: Along with domestic Indian Drumlin's.
Our increasingly.
Speaker Change: Exploring international destinations at all in the first half of 'twenty, 'twenty 415 million Indian travelers abroad Indians travel abroad, marking a 14% year on year increase and a 12% rise compared to 2019 skipped projections suggest that by 2027, India.
Speaker Change: Will become the world's fifth largest outbound travel market, that's presenting a huge opportunity for us.
Speaker Change: Our international outbound business continues to grow at a faster pace for Q2 fiscal year 'twenty five our international Air ticketing revenue grew by over 32% year on year for auto outpacing industry growth. Similarly on international <unk> revenue grew by over 63 per San Diego Aneel, making this one of our <unk>.
Speaker Change: There is a growing business segments let.
Speaker Change: Let me now turn to the business segment, starting with our air ticketing business, where near term near term supply challenges, particularly in the domestic air market remain.
Speaker Change: Despite the slow growth in domestic air supply, we have been able to maintain our leading market share position, while outpacing the industry growth rate overall on tobacco during the penetrated international Air segment.
Speaker Change: Air ticketing revenue grew by 20% year on year in constant currency terms.
Speaker Change: Youre not endeavored to keep improving consumer experience, we have recently launched a very customer friendly broader creature ballpark payment on internationally indicated which enables our customers to get a confirmed booking by being only a third inputs into a total fair upfront.
Speaker Change: The remaining balance of monthly period needed before the traveling data on within 45 digital booking whichever comes close this will help increase affordability and address cash flow issues. We also launched value bundles for international flights, including relevant predict products, such as visa with addiction full refund.
Speaker Change: Cancel for any reason and for you to change that.
Speaker Change: This has provided more flexibility add ons for the customer and led to more adoption.
Speaker Change: Our accommodation business, which includes retail and home stays in packaging continues to witness strong growth. We recorded a 24, 9% year on year growth in there just did margin on a constant currency basis, while October was a little slow due to the festival.
Speaker Change: The season picked up significantly in November and December on tobacco holiday season in mice and wedding related demand. We also witness broad base grew this quarter. There was an uptick in demand across all price points and consumer segments and use cases as a result of EBIT net record chickens in the last 10 days.
Speaker Change: Of December during the peak holiday season.
Speaker Change: So potential tourism is emerging as one of the other key growth drivers I'll do them in India.
Speaker Change: The new destinations getting added to the existing popular destinations lake widen if he could draw paedopathy surety et cetera. Besides specific events like mahogany related demand for this segment.
Speaker Change: To cater to that demand we have enhanced supply dipped in these emerging new cities on our platform and help such traveler to easily find suitable property my highlighting key aspects such as distance from pilgrim inside Reshade accessibility availability of lived and vegetarian food options. These features are now.
Speaker Change: We integrated into our product to provide smarter more personalized property recommendations as a result, this segment is growing faster for us, reflecting strong customer demand and satisfaction.
Speaker Change: We are also seeing concert driven demand across their gear, London Metro, which is a relatively new phenomenon in India, but estimates for the recent Coldplay concert in Mumbai around 25% of their goodbyes, where local home Bakers <unk> 75 per cent traveled from other Indian states.
Speaker Change: Presenting a new demand use case for driving we're also seeing good demand not only for domestic but also go to international destinations for example, Coldplay concert in Abu Dhabi and Taylor Swift in Singapore.
Speaker Change: And other consumer segment that is showing great promise for us as in bone, especially roaming noon guys, Florida.
Speaker Change: You might recall that last year, the meda platform <unk> compliant, making it accessible in London in 50 countries. Recently, we have also enabled it might be currency feature lying payments in 'twenty two major global currencies solving an important need of these customers I am happy to report that we have started to witness growth in inbound.
Speaker Change: Bookings, albeit on a small base.
As part of our overall journey a strategy. This quarter, we expanded mitre is Jenny I powered chatbot for Arctic Commendation product.
Speaker Change: Might I N handset the booking experience by handling real time pricing availability in specific hotel related queries.
Speaker Change: Complements our other general and generative AI capabilities, including image ordering.
Speaker Change: Creditors and user review analysis, helping customers find the best places to stay with us.
Speaker Change: Our homestay business continues to scale during the quarter.
Speaker Change: <unk> continues to scale during the quarter, we sold over 21500, plus unique properties across 920, plus unique destinations with strong growth across business and leisure destinations.
Speaker Change: Demand for from Predetermine cities grew the highest on the back of increased supply in this nation.
Speaker Change: And this year, you, they're pretty Agua Libre omni Fedex it et cetera.
Speaker Change: While property ratings and reviews have always been a cornerstone of our platform. We have taken a step further by introducing subcategory rating then summarizes it.
Speaker Change: Croskey elements like amenities food and location.
Speaker Change: Diff enhancement aims to build a deeper trust and transparency, especially in the non standardized care to video of alternative accommodation empowering customers to make more confident and informed choices.
Speaker Change: Our holiday packages business delivered robust performances that achieving highest ever gross booking numbers driven by strong growth in international bond packages with militia N C. A S countries witnessing Duane Arnold Road, Iranian oil and Vietnam witnessing over 70% year on year growth in orders.
Speaker Change: In our bus business grew it has further improved in Q3 on the back of about 15% year on year growth in private blood supply.
Speaker Change: Demand has was blind in the quarter due to the effective period in October traveling for weddings and auspicious locations in November and the holiday period in December as a result market growth has been robust with occupancy rates going up by nearly 5% points year on year.
Speaker Change: As market leader.
Speaker Change: Our growth was.
Speaker Change: Ahead of the market, resulting in share gain for us during the quarter, we expanded our language offering and redbook redbud and now offer a full fledged booking and fulfilled expedience, and indeed, Tamil Telugu and Canada as well.
Speaker Change: Our international business continues to grow well in all countries as as well with a growing contribution to the overall pie.
Speaker Change: What a real business, we continue to bring in new users to the platform. Besides growth in ancillary revenue was primarily from seed guarantee product.
Speaker Change: But our gaps business, we continue to scale, both airport transfers and intercity cabs. During the peak season, we were able to scale, our fulfillment to over 97% that getting to the peak demand on the product front, we scaled a multicity booking option for outstation gaps, enabling seamless and with multiple stops dude.
Speaker Change: This quarter.
Speaker Change: Our corporate travel business via both platforms. My reason quest for travelers is witnessing strong growth on active corporate customer count on my visit now over 64000, plus compared to 56000 customers. During the same quarter last year and for Q2 key the active customer count has reached 493.
Speaker Change: Large corporate compared to 334 customers in the same quarter last year.
Speaker Change: Our ancillary business is scaling up with we are witnessing healthy attach rates for products like travel insurance products et cetera, we have launched various bite sized insurance to address specific customer needs lending to an uptick in adoption growth and novartis business was driven by across silicon pain, including meeting reaching out to into.
Speaker Change: The national flights hotels, and holiday customer, we had multiple customer impacting funnel fluctuations.
Speaker Change: And lastly.
Speaker Change: Our strong performance. This quarter was also a belief supported by our marketing and customer reach strategy, we had well toward through brand campaigns, featuring three films based on deep consumer insights for hotels, and our negative equity users combined with wider customer reach via effective and efficient media mix.
Speaker Change: This campaign reached 200 million plus consumer across categories, leading to new user acquisition and helping us achieve our highest top of the mine we call in the travel category.
Speaker Change: With this let me now hand over the call to Mohit for the financial highlights of the quarter.
Mohit: Thanks Krish.
Speaker Change: Hello, everyone.
Baddish Model: We are pleased to report our 10, new highs and quarterly gross bookings and revenue and I just heard operating property during the quarter.
Speaker Change: Which was a seasonally better quarter for leisure travel.
Speaker Change: This very strong performance across all business segments, and more importantly from amazing pockets of demand that we had before.
Speaker Change: Increasing upon as well as our new services that we have been adding to our platform in the last few years.
I assured them that idea is the highlight of the quarter has been acceleration in bookings growth along with improvement in operating margins in comparison with the previous quarters for the year adjusted operating profit for the quarter came in at $46 million and adjusted operating profit margin as a percentage of gross bookings came in at $1 70.
Speaker Change: 6%, which is significantly better than one 6% due to the same quarter last year and $1 six 5% in the first half of this year.
Moving on to our segment results.
Speaker Change: Air ticketing gross bookings for the quarter came in at once by $5 billion witnessing.
Speaker Change: Witnessing a year on year growth of 23, 1% in constant currency and distant margin stood at $93.8 million year on year growth of 20% in constant currency.
Speaker Change: Privatizations updated about the continued outperformance and international ticketing, let me share some more color on domestic air ticketing in the domestic air market, while daily departures, a broadly similar level as last quarter of the market growth picked up.
Speaker Change: Most 9% year on year on a per loan basis in the seasonally strong quarter.
Speaker Change: You need to grow slightly ahead of the market with a continued 30% plus share of the domestic flight ticketing market.
Speaker Change: Gross bookings for the quarter in hotels and packages segment came in at $611 $5 million and a string of growth of 20, 354% year on year in constant currency adjusted margin growth was 24, 9% year on year in constant currency terms, resulting in adjusted margin of 11%.
Speaker Change: One by $9 million during the quarter.
Speaker Change: Continued efforts around adding more properties across the country have resulted in us being able to central night across more than <unk> hundred 50 cities through the country and compared to about 150.
Speaker Change: 1750 cities during the same quarter last year. This is Brad has more than doubled from pre pandemic levels. This argues than whereas as new supply expansion has been fostered in tier two and tier three cities almost 20, new hotels have opened in the first 10 months, adding about 8000.
Speaker Change: Rooms in the branded segment in these tier cities.
Speaker Change: We have spoken about scaling up their contracting for international Hotel and the recent deals and this strategy has helped us get accomplished in bookings.
Speaker Change: In overhead in 60 countries during this quarter a year ago.
During the fiscal year, we had called out efforts put them to become compliant with <unk>.
Speaker Change: Similar requirements in certain international geographies, which now allows at night forms, including our mobile applications to be Expensed in a 150 countries as a result, our inbound gross bookings crossed the initial pausing room.
Speaker Change: But their milestone during this quarter, we believe that the combination of inbound and outbound bookings growth will lead to an increase in the portion of.
Speaker Change: International hotels business in the coming years, which currently stands at around 19% compared to 14, 8% during the same quarter last year as part of the segment.
In our bus ticketing business, whereas booking for the quarter stood at $328 $9 million growing at 23, 6% year on year in constant currency adjusted margin is $235 million of raising a strong year on year growth of over 31, 3% in constant currency with demand.
Speaker Change: One by festivals and holiday seasonality.
Speaker Change: Rates continue to remain stable and in line across all our business segments.
Speaker Change: Similarly, our customer acquisition cost that is marketing and sales promotion expenses.
Speaker Change: Efficient and in line with the same quarter last year at four 9% of gross bookings. This is slightly higher than the four 6% reported in the previous quarter linked to changes in seasonality.
Speaker Change: In addition to driving strong bookings and margin growth, we remain focused on building operating cost efficiencies and driving operating leverage in our fixed cost, including huntsman selling our deliveries training expenses.
Speaker Change: A disciplined approach to cost management combined with targeted investments in technology and customer experience has enabled us to capitalize on this growing travel demand and drive profitable growth for instance, backbiting investments in automation and artificial isn't divisions are post this call center costs for the call.
Speaker Change: <unk> increased by just about 7% year on year compared to.
Speaker Change: Almost 96% year on year increase in bookings and revenue is driving.
Speaker Change: Cost efficiencies.
Speaker Change: This was a seasonally high travel quarter, coupled with the fact that the pickup in demand improved during the later half of the quarter. There has been higher than expected deployment and working capital, which is likely to reverse in the coming quarter.
Speaker Change: Our cash and cash equivalents stand at over $700 million, besides maintaining a Hindu watches we will continue to leverage this strong cash position to invest and potential organic and niche in organic growth opportunities as well as opportunistic stock buyback programs.
Speaker Change: In line with this strategy, we signed the business off of an agreement to acquire the happy expense management platform from okay.
Speaker Change: <unk> is a leader in expense management with over 900, corporate customers and robust capabilities in product development data driven insights and scalable solutions that consistently drives value and efficiency for corporate clients and does the agreement the happier brand and its expense management business as well as.
Speaker Change: The dedicated team for this particular business will transition to make my trip. This acquisition reinforces our commitment to becoming the go to platform for comprehensive.
Speaker Change: Corporate travel and expense management solutions, we expect the transaction to close in the coming quarter.
Speaker Change: With that I'd like to turn the call back to open for Q&A.
Mohit: Thanks Mohit.
Speaker Change: Any participant tools Oh once you ask the question can click on the raise hand button and deep will last and we will take the questions. One by one the I already have a few.
Speaker Change: Participants that's a first question is from the line of such and sell down cut off for a bank of America. So can you. Please ask your question now.
Speaker Change: Thanks weapon Congrats management for another set of fantastic strong numbers I have three questions. First question is on as I remember in the past you guys had said.
Speaker Change: The engine issues and as a part of that.
Speaker Change: Airplane operators might get resolved, but better look so far can this get delayed so wanted to get some color on that in terms of how should we look at the growth that Ed for calendar year, 'twenty 'twenty fly and the related question of course it is unlucky.
Speaker Change: We do see dated going down in the quarter I presume that's largely seasonality.
Speaker Change: I just wanted to understand if there's any pressure from indigo is static booking okay.
Jim: All right Jim. Thank you. Thank you firstly.
Jim: And yes, you're right we had spoken about the.
Jim: And supply constrains or the short term headwinds on the supply side, specifically with domestic market.
Jim: Probably getting and we had called it out and and you know we were hoping that and get a solid up all.
Jim: In the coming one or two quarters, when we had spoken about it a lot.
Jim: Last time, and you know what our understanding is that you know that improvement is happening right now improvement improvement is definitely happening in the overall supply and will supply new supply as the blended trickling in but it is at a slow pace.
Jim: And therefore the.
No I I guess.
Jim: For it to get completely Azad.
Jim: It's getting pushed for a for another quarter or two.
Jim: For it to get completely resolved.
Jim: The engine issues.
Jim: Planes that have been grounded.
Jim: Or gain or gain and.
Jim: They continue to sort of remain grounded because that problem is also not necessarily fully addressed but I think you know where there is a better progress between the tool you know the new supply versus existing supply.
Jim: Which is grounded the tanks to the engine issues I think they did it that it's positive progress happening on the new supply.
Jim: And not necessarily as the expected progress on the on the existing supply of a deal the day engines down I and there and that is sort of making it up. So overall I think you have to see this in perspective in the beginning of the year the overall projection on.
Jim: The growth rate of supply.
Jim: On a net basis.
Jim: Oh boy.
Jim: Oh Boy next let's say and it is about the Gan on there is that there is a lag of about 10, 15% on that.
Jim: Year to date right now so <unk> and.
Jim: And outlook for 'twenty fire. These though and we are hoping you know sort of this the pea.
Jim: <unk> picks up for the new supply and hopefully this situation gets resolved in the next couple of quarters, but certainly there is some delay that.
Jim: So let's take rate is concerned maybe Mike you can dig but yeah. So I think I can take that one and this is largely optical.
Jim: In language change in seasonality.
Jim: As you know the average selling price during.
Jim: Q3 tends to be much higher than Q2, they were pretty good liquidity from a competitive purposes, but due to the take rates have come down from about six 8% to 6.1, but this is likely close to about 13% overall, 13% kind of you know increasing ESP on a blended basis and in fact, if you look at it across domestic.
Jim: And of the.
Jim: Industry than.
Jim: He has been increase was even higher so this is largely optical coming in from gains in pricing regime based on seasonality.
Speaker Change: Got it. Thank you very clear second question wanted to understand how should we think about your steady state Yeah, I'd, just say David Martin.
Speaker Change: Already at the 1718 question right now question out there is what stops you from going to let's say, 2.5% to 3% in medium term you guys are pretty disciplined in cost control competition. As you know good operational leverage is playing out and of course, there's an added layer of inefficiency, what any openings and.
Speaker Change: Any thoughts okay.
Speaker Change: Yeah. So you know.
Speaker Change: This quarter generally as you know is a seasonally the best quarter of the of any your Q3, and therefore, probably country by itself is not necessarily an indicating off of you know how much the margins are kind of going to play out, but yes, we have seen.
Speaker Change: Good consistent growth and kind of operating margin expansion on the bottom line side and like I said.
Speaker Change: We currently I had him as to kind of raise the 1.82% or close to about 18% to 20% on an adjusted margin basis. So I'm sure as you kind of get closer to that are there.
Speaker Change: A range of that range, we'll have a better view on how margin expansion again kind of the R&D in the next few years.
Speaker Change: Okay and last question again wanted to understand if there's anything specific going had bought our interest income and interest expense.
Speaker Change: That's income is down materially on a Q O Q basis have much lower than the historical trend.
Speaker Change: And so as the financial costs, which have been much higher than they started to correct.
Speaker Change: So there's a pretty large you know to be factoring in some amount of forex fluctuations so could be coming from that maybe you do frequently at a slightly more detailed kind of you know northern this with you.
Speaker Change: Offline.
Speaker Change: Okay. Thanks.
Speaker Change: Okay.
Speaker Change: Thank you Sachin. The next question is from the line of mini shouldn't care off Goldman Sachs. Many Schmidt. Please ask your question.
Mini Schmidt: Thank you Paula Hi, good evening team. Thank you so much for taking my question, then again echoing what Sachin said congratulations on our all around performance in the quarter really nice to see that my first question actually related to that aspect of the business. I mean growth has been really strong mcglynn Giza Y O Y growth with Todd just you've been calling out international remains very strong.
Speaker Change: Not affecting in.
Speaker Change: Ed and Nino closer to 60% and that is my.
Speaker Change: My question here is like.
Speaker Change: Ken caused this number let's say meaningfully come down in the foreseeable future I mean in the international tablet in particular, it didnt all feasible for your business.
Speaker Change: Is there like any kind of one off that is really driving this consistently stronger literally the last two or three quarters. Then it could start tapering off and so your overall growth may come down or do you foresee our overall, let's say gross booking revenue growth.
Speaker Change: Staying at these levels just wanted to get your thoughts on push on the pushes and pulls here and how we should think about that because that is my first question. Please.
Speaker Change: Thanks, One Asia I think it's a great question.
So if you really see what we are sort of calling out.
Speaker Change: Sustained growth total Bliss gorilla tweaked our performance.
Speaker Change: Performance is is coming out of Oh.
Speaker Change: Sort of for two things combined.
Mike: One Mike.
Speaker Change: Macro and the other one Michael you know on the execution front I think we've been able to or to put dierdra best foot forward across the board, including sort of.
Mike: You know mopping up demand from various segments media channels.
Mike: Thanks to our Omnichannel strategy.
Mike: And so on.
Mike: But it is also sort of supported by the overall <unk>.
Mike: Macro trend, where fundamentally the consumer behavior and habits are changing and in terms of on the back of rising income rising disposable income.
Mike: In favor of spending more or rather larger pushing all disposable income in favor of travel and experiences and it's not only travel a dinner.
Mike: I as I was trying to highlight even in the on the call early on I told you about experiences like concerts and stuff you know.
Mike: And we're also getting the sort of a side benefit of under travel that is happening because of some of those events as well. So you know so to answer your question of what could possibly go wrong.
Mike: I mean, it could slow down this growth, albeit I would I would say it's largely macro.
Mike: So if let's say you know for some reason if the if the sort of spending goes down onto consumption pattern changes.
Mike: With respect to spending more on travel and experience.
Mike: And while we do believe because we'd be announcing consistently like.
Mike: <unk>.
Mike: I'm more sort of fundamental change in the in the spending pattern for travelers.
Mike: But let's say for some reason that changes because just the overall economy is not growing.
Mike: Admirable as Tor floor, you know there is some other macro event that happened.
Mike: It happens because of which the overall sort of a demand gets impacted.
Mike: Maybe that could be one of the reasons why it would oh relatively slow down but.
Mike: W. E T eight is the gain on.
Mike: That of course, any macro event, we can't really control, but what we are confident about is that you know whatever the rate of growth that the industry will be growing going back are you confident of growing at a at a higher raw radio growth than that for sure.
Mike: Sort of rig up regardless of the situation.
Mike: But if there is one aspect that could potentially change.
Mike: Our team the rate of growth.
Mike: It would be just this overall macro event and get on just general slowdown in the economy if that happens.
Speaker Change: Thank you that is extremely helpful. And my second question is regarding competition and it has to support fund from the airline directed and second on the OTC side and on the Atlanta, We've all seen in the last few months not just illegal being slightly more competitive than what they used to be historically, but despite that seem to have had no impact on your numbers your market share is up.
Speaker Change: Our growth looks phenomenal rightful one would love to hear why indigo, which is the largest airline in the country. Despite them being slightly more competitive has had no impact on your business. If you can just help us understand the nuances you know why you're still being able to maintain or grow your market share and second on the OTR side, we've now been in our fees for almost a year.
Speaker Change: More than that.
Speaker Change: We've not seen any meaningful competition definitely not in hotel and maybe even reducing competition on the airline side and again you all thought as to why that's the case I mean travel seem to be doing really well I mean international domestic travel all round growth is very strong, but despite that come to your site. It looks like a very stable company and intensity environment, maybe even declining so again, you all types to widen.
Speaker Change: Keith and if if you foresee that changing in the foreseeable future. Thank you.
Speaker Change: Germany. So you know you had on the first one in 19 of it so I was.
Speaker Change: Oh sharing my towards so even even on the last quarter call.
Speaker Change: From our point of view beneath the way we see it.
Speaker Change: Is are our focus is and it goes hand in hand, right. So it's not necessarily we have to take supplier direct either direct competition.
Speaker Change: And if we start to sort of focus more on the larger buy of the of the market that is sort of available for the intermediaries as well right. So.
Speaker Change: And if it let's say whatever it might be the supplier direct share today and even if that is growing.
Speaker Change: Incrementally.
The rest of the sort of a portion of the pie is very very large and we if we are able to stay focus is focus on diet and able to sort of get the lion's share of that by.
I think that is the data that has been our strategy that has been our focus and our and we've been able to execute our strategy as well too to ensure that that.
Speaker Change: That continues to happen and that is sort of consistently reflecting on our overall market share, let's say on the domestic market holding or not incrementally improving.
Speaker Change: And on the Underpenetrated market on the on the international freight where there's relatively more competition.
Speaker Change: On the supplier ecosystem.
Speaker Change: And from an Internet validation standpoint, it is underpenetrated, we've just doubled down on on improving the customer experience.
Speaker Change: I'll sort of attacking the that particular segment 360 degree alright, and sort of grabbing onto the potential. So that has been our strategy and that will continue to keep doing that and you know it might happen with more players going online is that you know overall online penetration overall.
Speaker Change: Continues to sort of grow.
Speaker Change: Eric because there is still a lot of headroom there get left for a lot of the business that could potentially move online.
Speaker Change: I think that's the way we've seen it and we'll continue to keep seeing it that way and and Kenai and sort of working out well for us now.
Speaker Change: Now as far as the second part is concerned again I think I was I would link it back to the you know the.
Speaker Change: The answer that I was giving to your first question I think one of the factors that has also worked in our favor is to just besides that would be to see very strong retail segment that we've been.
Speaker Change: Of consistent there.
Speaker Change: From a growth perspective, from retention perspective, on the back of the experience and the innovation that we keep doing on our product side.
We've also been able to...
very successfully execute
Speaker Change: are reached to the other customer segments, you know, corporate business, for example.
which is relatively a very young...
business for us for five years old.
Speaker Change: But we've significantly sort of scaled their business already in that short span of time.
Speaker Change: And similarly, you know, our travel agents, you know, my partner channel.
similarly are you know sort of other
you know affiliate strategy with the other affiliate partners.
Speaker Change: from where we have been able to sort of get the long tail demand as well.
Thank you.
you know combination of the very high repeat rate and
and you know very healthy new user acquisition every
Speaker Change: every single quarter because of, you know, sort of this multiple channel strategy.
Speaker Change: and reaching out to the new consumer segments is sort of helping us.
you know sort of grew out by
and get better sort of share from the market.
Speaker Change: I think that is perhaps the single largest reason for, and besides, obviously, relentless execution across the board. It's sort of helping us, you know, stay ahead in the curve and stay ahead in the market.
Speaker Change: Thank you so much, Rajesh, and all the best. Thank you, Vinesh.
Speaker Change: Thanks Manish. The next question is from the line of Vijit Jain of Citi. Vijit, you may please ask your question.
Vijit Jain: Thanks, Vipul, and congratulations team. I echo everyone else. Great set of results. My first question is, you know, typically this current quarter is somewhat seasonally weaker, right? Coming off after 3Q, but as you called out earlier,
Vijit Jain: You know both these events, Fool Play and Mahakumba multiple day events in January and I think Indian Hotels in the call.
Vijit Jain: Do you think generally speaking, 4Q, at least from your vantage point right now in January, seems like it's going to be less seasonal versus previous years?
Vijit Jain: Well, you know, I don't think it's going to be any different from the previous, you know, years. We don't really anticipate that, just from a seasonality standpoint.
Vijit Jain: And that is specifically, and we should keep that sort of nuance point in mind.
Vijit Jain: that when we call it that April, May, June and October, November, December seasonal quarter for us, favorable seasonal quarter for us, that's mostly for leisure use case.
Now in our business we've got
Vijit Jain: You know, pretty much sort of addressing and reaching out to the consumers for all kinds of use cases, including a lot of that non-leisure use cases as well. Like, for example, pilgrimage tourism, you know, which is sort of emerging as a new growth segment in India particularly. Now that has no season.
Vijit Jain: You know, that is across the year, the pilgrimage travel that happens.
Vijit Jain: Similarly, business use case, business travel use case, and so on, right? So, and you know, some of the new use cases that, you know, off late that sort of have been emerging as well, like, you know, celebration of occasions.
Vijit Jain: link to let's say staying in alternative accommodation kind of a use case.
Vijit Jain: And, you know, so now our business is a combination of all these use cases from a consumer demand standpoint.
Vijit Jain: And therefore, you know, when we look at the seasonality aspect of it, we should just with respect to our numbers, we should keep that thing in mind.
Vijit Jain: and we can sort of look at the pattern for the last, you know, historical few years and quarters for us to be able to sort of draw some pattern out of it.
Vijit Jain: But specifically this quarter, will it be significantly different on seasonality as we see?
Vijit Jain: Coming out of October and November-December Because this is relatively low season quarter from a leisure use case standpoint We don't see any different sort of pattern at least as of now
Speaker Change: if you can give a broad sense of how much are you spending on you know top of the funnel type of things
Speaker Change: What would be called pure brand marketing, so to say. We're just trying to get a sense of, you know, that...
Speaker Change: what is the percent of marketing spend which is not directly attributable to any bookings as such
So Vidit, maybe I can take that and you know...
Speaker Change: I would say another way to look at, you know, the overall, you know, customer action costs or marketing and sales promotion would be to kind of look at the trends, you know, by seasonality.
Thank you.
Thank you very much.
Speaker Change: tweak these in line with seasonality because it makes so much more sense to kind of expand slightly more in a better seasonality.
Hello, everyone.
Speaker Change: You know kind of you know campaigns would keep evolving in line with the changing kind of you know
Thank you.
Thank you.
Speaker Change: and that has a you know kind of a slightly longer life cycle so I think just looking at the trends over respective seasonalities by quarter would give you a good indication
Speaker Change: On the Gen AI side, you talked about Myra. A lot of discussions that I see on Gen AI seems to also suggest that one of the first things that it will be able to do end-to-end is travel bookings.
Speaker Change: So your thoughts on that, I guess they call it agentic AI, first use case will be in holiday bookings and travel bookings and stuff. Your thoughts on that and is that something that you guys are experimenting with?
Vijit Jain: Thank you very much, Vijit. As part of our Gen AI strategy for the last several quarters now, our focus has been just picking up any potential application of this.
In the context of our business, we've been just...
Vipul Garg, Rajesh Magow, Rajesh Magow, Vijay Kedare
Vijit Jain: And that includes what you just mentioned, using the agentic AI, you know, if you look at some of our chat boards that are already live and you know, and I mentioned, you know, recently we've gone live with our
on our hotel and echo funnel as well.
Vijit Jain: That is actually, it is completely a new user interface, interactive user interface.
Vijit Jain: for hotel booking, and addressing all kinds of queries, you know, related to the hotel booking, and then eventually sort of helping doing the booking as well.
Vijit Jain: So, you know, my take on this is that this is a journey.
Vijit Jain: You know, while on the face of it, you know, everyone is sort of so excited and
and passionate about Gen AI in particular.
Vijit Jain: But it's going to be a journey on two counts, one of course, and from our point of view, we are, you know, this is one of the...
Vijit Jain: proposed strategic items for us as far as the overall business strategies is concerned for the last several quarters. We'll continue to keep marched ahead and try to ensure that ...
Vijit Jain: You know, we sort of lead this, at least from a travel use case standpoint or whatever, you know, promise this technology has to offer. But the other aspect, which is equally important, is also going to be adoption.
because some of these
Vijit Jain: you know sort of new let's say Gen AI based interactive front ends that you would end up
sort of developing.
and that has to be also adopted by the consumers.
and that is always a journey.
Vijit Jain: You know, and our endeavor is to make it more and more intuitive, more and more accurate, more and more relevant, personalized, you know, super convenient, etc.
so that their adoption is faster.
but it is also a question of
Vijit Jain: You know, the other one has to be a really compelling...
Vijit Jain: you know, sort of alternative for me to be able to make the shift. So it's always a journey because you have all kinds of consumer cohorts in our country.
But from our point of view, we are...
Vijit Jain: Like I said, it is a core part of our strategy.
we will definitely be looking at
Vijit Jain: and working very closely in terms of you know sort of partnering with the right sort of partners both from content standpoint and technology standpoint and making sure that we we you know as not only we develop and go live but also learn from
Thank you.
Vijit Jain: which is which is getting solved every alternative you know sort of new model that comes into the the picture and we are adopting all of that so we had absolutely sort of deep into it already
Vijit Jain: And, you know, pretty much every quarter you will see, you know, something or the other, you know, on Gen AI coming from, coming from EquatRIP.
Thanks Rajesh. Those were my questions. Thank you so much.
Unidentified Moderator: Thanks, Vijit. The next question is from the line of Gaurav Ratheria of Morgan Stanley. Gaurav, you may please ask your question now.
Kaurav, we are not able to hear you.
Auroville is not on mute but
something wrong with his, now he's on mute, I think.
Speaker Change: Maybe we give the opportunity to the next caller. In the meantime, we'll take the next question. Next question is from the line of Ankur Rudra of G.P. Morgan. Ankur, you may please ask your question now.
Thank you and a very strong quarter indeed.
Speaker Change: This first question is on the demand side, clearly the demand from your side looks extremely solid and extremely strong.
Speaker Change: but several sections of the Consumption Basket continue to point out signs of some sort of weakness including parts of your...
Speaker Change: You don't seem to be seeing this in the last quarter, can you confirm that it's something being hidden by the strong headline numbers because of pricing. And in the current quarter, have you seen any signs of that in any of your customer cohorts which are seeing any impact of consumption store down?
Speaker Change: No, Ankur, it's a good question. I think it's a good observation with respect to some of the other categories as well. And, you know, there have been moments around.
Speaker Change: but as far as travel and tourism, you know, sort of spend from a consumption pattern is concerned, we've been lucky, you know, October as I was trying to highlight even
even as part of the script.
Thank you.
that is that is actually quite robust as well.
Speaker Change: So, part of that, as I was just responding to the earlier question as well, part of that is also from our side, obviously.
Speaker Change: you know, slow down, if you will. Now, we will have to obviously watch the situation and how it develops, let's say, for the other categories as well. Because if you look at the overall economy projections, even for the next couple of years, they continue to be robust.
Speaker Change: So, I am hoping whatever is happening to the other category is also an aberration. But, you know, having said that, we will keep watching the space very carefully.
Speaker Change: Thank you. And Rajesh, is there any difference in the nature of the strength of demand you see between the budget traveller category and the more premium traveller category, perhaps by, you know, the app Goibibo users versus Makemerchand users in any sense?
Speaker Change: You know what, and we looked at that because, you know, this is quite natural for us to sort of look at different cohorts as well.
We saw all segments growing.
Speaker Change: And I was alluding to that again in the script as well. We saw pretty much budget, mid-segment, premium, etc., all of them growing. And premium segment growth has been, you know, as we've been sort of calling out for the last few quarters as well, it's been very robust, you know, and clearly it's a function of...
Speaker Change: on Travel and Experience, more so for premium category and higher.
upper middle class category.
but even for budget
Speaker Change: You know, budget segments specifically for hotels, for example, between Mekhamatrip and Goaibibo.
Speaker Change: We saw that growth sort of coming back as well. So, at least for us on our platform, both brands put together.
Speaker Change: In the last quarter, we didn't really see any sort of, you know, particular specific cohort, you know, slow down in any of those cohorts, actually.
Speaker Change: Thank you, Rajesh. Rajesh, you know, we've seen a significant amount of currency volatility in the last, you know, few months of the quarter.
Speaker Change: I don't know whether it's happened anything this quarter but you know looking at past cycles have you seen any kind of impact of this either directly or with a lag in consumer behavior when they see headline prices change for certain destinations?
Speaker Change: Ankur, at least in this seasonally strong quarter we haven't seen an impact like Rajesh called out.
Speaker Change: when it comes to international flights as well as international hotels.
Speaker Change: You know, we continue to see strong demand and, you know, particularly, you know, from those regions where, you know, visa has been made more easier or kind of, you know, visa relaxations have been offered, the demand continues to remain pretty strong.
Speaker Change: You know, whenever there is this fluctuation, I mean, it's natural for if, you know, Rupee becomes weaker and, you know, a particular destination becomes more expensive. What we've seen is that, you know, we don't see change of people dropping the plans for travel. They just look for an alternative destination.
Speaker Change: You know, which is relatively sort of cheaper where, you know, less, let's say, you know, less impact on the currency fluctuation, whether it is overseas or domestic, but, you know, we haven't really seen people particularly changing the plans for travel, at least historically.
Speaker Change: the B2B and the B2B2C segments and also your international business. Would you remind us how much of your business is from there? Also, if you can estimate what sort of share MakeMyTrip has here, perhaps it's a bit lower than your traditional consumer segments.
Speaker Change: On the international side, you know, our mix of business coming in from, you know, outbound or inbound or international transactions per se overall, all put together, that mix has now moved over 25%.
Speaker Change: and on coming to B2B particularly on the corporate side we had shared some numbers you know if I recollect in the first quarter of this year we had called out that corporate bookings have kind of you know scaled up to
Speaker Change: or close to about $200 million run rate on a quarterly basis. So those are the two kind of things that I could call out as indicators.
Speaker Change: At least, you know, a fourth of the market, you know, should be, you know, business driven or corporate driven, if not higher. So, there's a long way to go in terms of, you know, trying to catch up on that ratio.
Speaker Change: Understood. Rajesh, last question. You again spoke about events and pilgrimage. Is it possible to quantify what size of the travel market or I mean if you can estimate also for your own bookings is coming from there?
Speaker Change: Pilgrimage, as such, or some of the other new emerging demand segments like, for instance, all these.
Speaker Change: and therefore these are now new opportunities that we are kind of dialing up and therefore, you know, doing a full holistic kind of, you know,
Speaker Change: kind of, you know, improvement in these areas. So, the kind of shoring up supply very significantly, you know, in these, in these cities.
Speaker Change: and also kind of, you know, trying to build the right kind of, you know,
Speaker Change: platforms or channels to be able to cater to the demand that emerges for these kinds of specific travel requirements, both B2B and B2C. So, I think this is more...
slightly longer term.
Speaker Change: to Encash, just like on the corporate side, right now pretty nascent.
Speaker Change: Okay, appreciate it. Thank you so much and best of luck. Thanks. Thanks, Ankur. We'll take the last question now from Gaurav for Morgan Stanley.
I hope I'm audible now. Yes, you are.
Gaurav: Yeah, Happy New Year and congratulations on great set of numbers. I have a few questions. I want to understand what's the pace of new customer addition per quarter that we are seeing now let's say
versus what we were seeing last year.
Gaurav: Actually pretty robust Gaurav there as well and Happy New Year to you too.
Gaurav: you know our and just to give you maybe one data point and you can calculate that so our repeat rate has been you know on a quarterly basis have been pretty robust have been used to be about 70 71 percent last quarter was about 73 percent
Gaurav: This is like 73% of the transactions coming from the live-to-date customers.
Gaurav: and our overall, you know, customer base is now, you know, live to date. All three brands put together has touched about 80 million, you know, up from 77 million.
Gaurav: and typical contribution from new users has been in the range of between 25 to 30 percent. And so effectively it just continues, you know, at the same, at the scale. Every quarter we are obviously adding more and the scale is only going up in one direction.
but with the ratio of new users and the repeat.
Gaurav: hasn't really changed a lot you know so the 70-30 you know going to let's say 70-73, 27-72, 28 kind of so broadly remains the same range
Gaurav: Also in absolute terms, Gaurav, the net new addition to the platforms generally ranges anywhere between one and a half to say two and a half million customers during any quarter. So that is the typical kind of new addition that we see.
Gaurav: Why the ad spend as percentage of gross booking in this nine months of fiscal year appears higher than the last year? What explains this?
Speaker Change: increase, is it more investment led, is it more defending any new competition, just trying to understand that. You're talking about the marketing spend.
Gaurav: Only, you know, versus, say, for instance, marketing and sales promotions put together. Yeah, like put together, I'm looking at the number combined.
Gaurav: The combined number largely has kind of trended in line with, I would say, last year, and you know, like we had said, we would want to kind of keep this at a minimum.
Gaurav: at below five percent levels and like I was just mentioning on another you know question earlier.
This number has trended at about 4.6% of gross bookings.
Gaurav: during say seasonally weaker quarters, you know, say for instance Q2, Q4, and generally trended at around 4.9 to 5% in seasonally stronger quarters like Q1 and Q3. So there hasn't really been any kind of substantial change or increase per se.
overall online market in these segments. Thank you.
Gaurav: little difficult to kind of, you know, call out, you know, market shares in the hotel segment, as you know, because, you know, there's no kind of industry report, you know, unlike we kind of, you know, get it from DGCI in case of, you know, domestic flight ticketing, our high level estimate would be that
Gaurav: about, you know, 18-20% of the market would have moved online and we would possibly be about close to about half of that, you know, it is a very high-level broad estimate in terms of the size of the market.
Again, if you look at it in terms of
you know, competitive dynamics.
Gaurav: comparatively kind of, you know, better in the hotels or in the accommodation space, say vis-a-vis compared to, you know, the ticketing space because pretty much, you know, all the OTAs have a much larger kind of, you know, skew towards ticketing compared to accommodation. And therefore, to some extent, you know, competition on.
Gaurav: on the hotel side is also with the global OTS because they tend to kind of be, you know, more focused on
in the, I would say, mid-to-premium segment.
But again, they're a larger share of...
Gaurav: You know, their kind of volumes will be more inbound, whereas, you know, we focus a lot more on domestic and outbound.
Unidentified Moderator: Thank you and all the very best. Thank you, Gaurav. Thank you, Gaurav. This was our last question. Over to you Rajesh for your closing comments.
Speaker Change: Thank you, Vipul, and thank you, everyone. Great set of questions from everyone, and thank you for appreciating, and thank you for your patience, and we'll see you again next quarter.
Unidentified Moderator: Goodbye.