MakeMyTrip Reveals India IPO Fungibility Plans and AI Now Writes 75% of Its Code as Currency Swings Mask 20% Constant-Currency Growth
Q1 FY27 earnings call, August 3, 2026
MakeMyTrip navigated a quarter marked by the West Asia conflict, elevated fuel costs and a weakening rupee, yet still delivered constant-currency gross booking value growth of 19.9% year-over-year, with the headline dollar-denominated numbers obscured by roughly 10% of currency translation drag. The company's non-air segments, hotels, packages and ground transport, did the heavy lifting, offsetting a soft air ticketing environment where the broader domestic industry saw departures roughly flat and international departures down 13%. IFRS revenue came in at $285.6 million, up 16.1% in constant currency, while adjusted operating profit was $51.4 million, holding margins steady at 1.8% of gross booking value.
India Listing Fungibility: The Real New Disclosure
The most consequential new information came on the corporate structure front. MakeMyTrip confirmed its wholly owned subsidiary, MakeMyTrip India Limited, confidentially filed a pre-filed Draft Red Herring Prospectus with SEBI and Indian stock exchanges on July 17. But the bigger reveal was management's willingness to discuss what comes after the IPO. Group COO Mohit Kabra laid out multiple structural options under consideration, including an ADR structure, an inversion of the corporate structure, or an outright merger, potentially executed via the NCLT or RBI routes. Kabra noted that "today's articles also carry that the parliamentary committee is also looking at inverting of the structure and they would come up with very specific recommendations around this," suggesting regulatory tailwinds may already be in motion independent of MakeMyTrip's own lobbying.
Management was careful to frame this as a post-IPO workstream rather than an imminent event. Kabra said the company "can only undertake or think about in real terms once the India listing goes through," and when Goldman Sachs analyst Manish Adukia pressed for a realistic timeline, six months, a year, two years, Kabra demurred, saying only that regulatory changes "could happen in a very short span" but that visibility would improve "as we have more color around it." The intent, however, was unambiguous: enabling shareholders "to participate between the 2 listed options in a much more seamless manner without having to exit from one to get to the other."
On the balance sheet implications, the company's $200 million tranche of 2028 convertible bonds is "reasonably well into the money," per Kabra, and thus unlikely to be disrupted by any structural change. The larger $1.4 billion tranche issued last year remains out of the money, but Kabra argued the India IPO proceeds would only strengthen the group's roughly $800 million cash position, leaving it "well prepared to handle both a redemption or conversion" regardless of how markets move.
AI Is Now Doing Real Financial Work, Not Just Marketing
MakeMyTrip disclosed some of its most concrete AI productivity metrics to date. AI now generates more than 75% of the company's code, and its AI-powered voice bot independently resolves over 50% of customer service calls with no human intervention, a figure co-founder and CEO Rajesh Magow said could climb to 65-70% "without too much of additional work on the development side." This is showing up directly in the cost structure: Magow noted that outsourcing costs embedded in SG&A are "not growing at all" even as the business scales, which he called a source of "some goodness" in the P&L.
The company's conversational assistant, Myra, handled over 8 million conversations in the quarter, including 3 million in June alone, with 45% of usage originating from Tier 2 and smaller cities, a signal that AI-driven interfaces may be disproportionately unlocking demand outside India's largest metros. The newly launched Myra 2.0 extends this into full conversational booking, including agentic payments, across eight Indian languages, though Magow was candid that this end-to-end booking capability is "early days" and traction has "just about started to come," with more data expected over the next one to two quarters.
Importantly, Kabra pushed back on the idea that AI investment is diluting margins or, conversely, driving major opex savings just yet. He described the current state as roughly offsetting: incremental AI infrastructure costs, netted against token-cost optimization from blending open-source and frontier models plus productivity gains, are "almost offsetting the increase in cost." In other words, AI is currently margin-neutral, with upside optionality rather than an immediate profit lever.
Strategic Choice: Market Share Over Margin Expansion
Perhaps the most direct strategic statement of the call came in response to a Goldman Sachs question about why operating profit growth in dollar terms was tracking close to revenue growth rather than showing operating leverage. Kabra was unambiguous that this is a deliberate choice, not a structural constraint. With India's flight market outright contracting, he pegged the industry decline near negative 2%, "which is almost unprecedented", management is choosing to press its advantage rather than harvest margin. "As a market leader, as an aggressive player in the segment, it is very clear that we want to press on building market share during these turbulent times rather than kind of focus on building profitability," Kabra said, adding the company is "happy to remain" around the 1.8% adjusted margin level for now rather than force it higher.
Magow reinforced this by pointing to newer categories such as tours and attractions, where the company operates a catalog of over 250,000 experiences across 139 countries plus a newly launched domestic offering across 50-plus Indian cities. "There's significant headroom still across the board on overall many segments being online, low penetrated," Magow said, arguing that profitability will naturally flow through once the reinvestment opportunity set narrows, but that time is not now.
Segment Performance: Non-Air Categories Carrying the Business
Hotels and packages adjusted margin grew 21.3% year-over-year in constant currency to $134.5 million, with standalone hotel bookings up 20.2% even as international hotel demand was hit by the same conflict-driven weakness affecting international air. Bus ticketing adjusted margin rose 22.4% on 23.9% volume growth, while intercity cabs grew in the 40% range off a smaller base. Air ticketing adjusted margin still grew 10.8% despite a marginal volume decline, aided by stronger ancillary attach rates. Management reintroduced its native flight booking partnership with PhonePe under the Goibibo brand after a two-year hiatus, a distribution move aimed at capturing high-intent digital customers beyond MakeMyTrip's own channels.
The company also launched OneCircle, a cross-network hotel loyalty program spanning over 13,000 properties at launch, and introduced paid guaranteed early check-in and late checkout features, positioning both as differentiators addressing chronic traveler pain points, particularly relevant for Indians traveling overseas where flight timings rarely align with standard hotel check-in windows.
Working Capital and Cash Position
CFO Dipak Bohra flagged a cash flow from operations decline tied to working capital expansion in the fast-growing myBiz corporate travel business, where days-sales-outstanding terms scale with volume growth, compounded by seasonally lower customer advances heading into the traditionally slower July-to-September period. The company still ended the quarter with $794 million in cash and deployed $7.8 million toward its share buyback program, alongside continued absorption of $29.3 million in non-cash interest expense on its zero-coupon convertible bonds, which drove reported net profit down to $9.1 million despite adjusted pre-tax profit of $52.2 million.