India’s robust travel demand drives MakeMyTrip’s profits in Q2, revenue up 26%

MakeMyTrip maintained growth momentum in Q2 FY25 despite a seasonally slow quarter.

The continued increase in demand for travel in India led to travel platform MakeMyTrip report profit of $17.9 million during the September quarter of FY25, up from $2 million during the same period a year ago.

The company's revenue (as per International Financial Reporting Standards) grew by 26.5 percent year-on-year (YoY) at $211.0 million in the second quarter of FY25 from $168.7 million in Q2 FY24.

"The increase in revenue was primarily due to the robust travel demand in India for both domestic and international outbound travel in the quarter ended September 30, 2024 as compared to the quarter ended September 30, 2023," said Rajesh Magow, Group Chief Executive Officer, MakeMyTrip.

Magaow added that the company achieved sustained growth in a seasonally slow quarter.

"Revenue from our air ticketing business increased by 25.6 percent to $61 million in Q2 from $48.6 million July-September period a year ago. The segment's growth was driven primarily due to the robust travel demand in India for both domestic and international outbound travel in the quarter ended September 30, 2024," the company said in its earnings release.

Hotels and Packages segment's revenue increased by 15.5 percent to $103.2 million from $89.4 million. The company attributed the increase in revenue from hotels and packages to an uptick in gross bookings by 19.6 percent primarily driven by a 17.5 percent increase in the number of hotel-room nights in Q2 FY25.

Revenue from bus ticketing business also grew to $24.8 million from $19.8 million, up 25.4 percent. Gross bookings for buses was up by 19.9 percent driven by a 21.4 percent increase in the number of bus tickets travelled year over year.

MakeMyTrip's marketing and sales promotion expenses increased by 43 percent to $35.8 million in the September quarter of FY25 from $25 million, due to discretionary expenditures such as expenses on events and brand building initiatives in response to the robust travel demand in India.

The travel platform had started the new financial year on a strong note, with 21.6 percent increase in its gross bookings in Q1 FY25 on the back of growing travel demand in India.

The Group CEO had also attributed the rising disposable income of the middle class who are spending more on discretionary services like travel to company's robust start in FY25.

“We believe that the long-term growth story of India's travel and tourism sector is fuelled by multiple macroeconomic drivers like increasing government investments in travel infrastructure, rising disposable incomes of the middle class, and increasing propensity to travel. These drivers indicate that India's travel and tourism industry growth is expected to be higher than the country’s GDP growth rate," he had said.