MakeMyTrip: Still In The Driver's Seat To Capitalize On The Demand Tailwind

MakeMyTrip (MMYT) reported a robust 1Q26, with adjusted revenue climbing 19% year-over-year to $283 million and adjusted EBIT up 21% to $47.3 million, underscoring the resilience of Indian travel demand despite temporary geopolitical and incident-related headwinds that saw a rapid rebound in July. The company solidified its domestic market leadership, increasing air ticketing share to 30.8%, while its international segment emerged as a significant growth driver, now accounting for 27% of revenue with international hotel revenue surging 45% year-over-year. Despite strong operational performance and intact secular tailwinds, MMYT trades at 7.25x forward revenue, suggesting a re-rating to 9x could imply over 20% upside, given its proven ability to navigate shocks and expand margins.

Analysis

MakeMyTrip (MMYT) demonstrated significant operational resilience in its 1Q26 results, delivering 19% year-over-year growth in constant currency adjusted revenue to $283 million, despite temporary headwinds from geopolitical tensions and an airline incident. This performance was broad-based, with notable strength in the Bus segment (+34.1% YoY) and the international business, where hotel revenue surged 45% YoY. The company's ability to navigate short-term disruptions is underscored by management's commentary on a rapid rebound in travel demand in July, reinforcing the thesis of a robust secular growth trend in the Indian travel market. MMYT has solidified its market leadership, evidenced by an increase in its domestic air ticketing market share to 30.8% and a growing corporate client base of over 66,500. The international segment has evolved into a core growth driver, now accounting for 27% of total revenue, up from 24% a year prior. This strategic diversification, supported by direct hotel contracting and partnerships like the one with Premier Inn, provides a crucial buffer against domestic volatility and de-risks the investment case. Despite these improved fundamentals and proven resilience, the company's valuation has compressed to 7.25x forward revenue, suggesting a disconnect with its operational momentum and margin expansion trajectory.

Key Decisions for Investors

• Given the strong top-line growth, solidified market leadership, and a valuation of 7.25x forward revenue, investors may view the current share price as an attractive entry point, particularly with the potential for multiple expansion towards the historical 9x level.
• The emergence of the international segment as a key growth engine, now representing 27% of revenue, should be viewed as a significant enhancement to the investment thesis, providing both a new growth vector and a hedge against domestic market fluctuations.
• While the outlook is positive, it is prudent to monitor for any re-emergence of external shocks that could impact travel demand or a significant shift from the currently rational competitive environment, as these are the primary risks to the growth and margin profile.