MakeMyTrip overcomes air travel challenges, experiences a surge in international bookings

MakeMyTrip anticipates ongoing supply chain challenges in the air travel sector for Q4FY24, but remains optimistic for improvement in the next financial year. Despite challenges in domestic air travel, the company has experienced significant growth in international air travel. MakeMyTrip has also expanded its hotel offerings and expects increased momentum in that segment.

During the Q3FY24 results post-earnings call, Rajesh Magow, Group CEO of MakeMyTrip, acknowledged near-term supply challenges in the domestic market. Indian airlines have been impacted by supply chain constraints due to the insolvency of GoFirst and grounding of airplanes related to Pratt & Whitney engine issues. However, efforts are being made to address this supply gap, with airlines expected to collectively add about 150 planes next year, the highest number of additions in a single year.

MakeMyTrip reported a net profit of $24.2 million in Q3 FY24, a significant increase from the previous year’s net profit of $0.2 million. Despite short-term challenges, the company’s growth on a flown basis exceeded market growth, consolidating its market share at 30%+ levels in the domestic air market.

In terms of international air ticketing, MakeMyTrip has not only fully recovered from the pandemic but has also exceeded pre-pandemic levels. Despite facing challenges in the air travel segment, the company has compensated with growth in the hotels segment. New direct flights to various destinations and visa waivers for Indian travelers have contributed to increased demand for international travel.

To further capitalize on this demand, MakeMyTrip plans to expand its eVisa offerings for the UAE. The accommodation business, including hotels, homestays, and packages, experienced strong year-on-year and quarter-on-quarter growth in the seasonally strong quarter. The company achieved its highest ever single night check-ins and sold over 63,000 domestic hotels across 1760 cities. MakeMyTrip also saw improved margins for this segment and intends to add more properties to its platform.

In summary, MakeMyTrip continues to navigate challenges in the air travel sector while experiencing growth in the international segment and compensating with expansion in the hotels segment. The company remains optimistic about the future and is taking steps to capitalize on the increasing demand for international travel.