MakeMyTrip Limited

Good evening, everyone. We're just waiting for one minute for everyone to join and we'll start. Hello, everyone. I'm Vipul Garg, Vice President, Investor Relations at MakeMyTrip Limited. And welcome to our fiscal 24 third quarter earnings webinar. Today's event will be hosted by our company, by our leadership team, comprising Deep Kalra, our company's founder and chairman. Joining him is Rajesh Mago, our co-founder and group chief executive officer, and Mohit Kabra, our group chief financial officer. As a reminder, this live event 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. Furthermore, certain statements made during today's event may be considered forward-looking statements within the meaning of safe harbor provision of U.S. Private Securities Litigation Reform Act of 1995. These statements are not guarantees of future performance, are subject to inherent uncertainties, and actual results may differ materially. Any forward-looking information relayed during this event speaks only as of this date and the company undertakes no obligation to update the information to reflect changed circumstances. Additional information concerning these statements are contained in the Risk Factors and Forward-looking Statements section of the company's Annual Report on Form 20-F filed with the SEC on July 25, 2023. Copies of these filings are available from the SEC or from the company's investor relations department. I would like to now turn over the call over to Rajesh. Over to you, Rajesh.

Thank you, Vipul. Welcome, everyone, to our third quarter call for fiscal 2024. We are pleased to report another quarter of strong operating performance during this high season quarter for leisure travel. We witnessed robust demand for leisure travel for domestic as well as outbound travel and are pleased to report our highest ever quarterly gross bookings revenue and profit till date. Gross bookings for the quarter reached $2.1 billion, growing at 21.7% year-on-year in constant currency terms, while our adjusted operating profit or adjusted EBIT grew by 70% year-on-year to $33.4 million as compared to $19.7 million in the same quarter last year. As per government estimates, Domestic aviation traffic is expected to double from current levels by 2030. To cater to this increasing traffic, there is continued and increasing investment across all categories of travel infrastructure, resulting in significant upgrades across all categories of transportation, including airports, highways, rails, and thus offering customers more convenience and choice. The current commitments of close to $11 billion in airport modernization should only help meet the near to medium-term requirements, but for the first time planned airport capacity we've put in place could exceed the projected demand for next five to seven years, which bodes well for the travel and tourism industry. According to Bernstein report, India has gradually been gaining share of the global travel market, now representing 2% of tourism receipts globally, up from 0.7% in 2000. Domestic travel in India is already the fifth largest globally and is expected to become the third largest by 2027. The size and diversity of India contribute to the strength of domestic market and the government's efforts to develop new tourism destinations will help in maintaining this growth momentum. Outbound travel from India has also recovered to pre-pandemic levels. now and the growth momentum is expected to pick up pace in the coming quarters and years. India is expected to be the fifth largest outbound market by 2027. This should lead to India outbound being the fastest growing component of overall India travel spends. We are excited about these opportunities and remain committed to excellence and innovation, meeting and hopefully exceeding the diverse travel aspirations of Indian travellers. As for our business segments, Let me start with our air ticketing business. During the last quarter, I talked about near-term supply challenges, particularly in the domestic market, due to the insolvency of go-first and the grounding of airplanes due to P&W engine issues. The Indian carriers are taking various steps, including addition of large number of planes in the coming years to fill this supply gap. As per estimates, collectively, airlines are expected to add about 150 planes during next year, which will be the highest number of additions in a single year. We are hopeful that the supply situation will start improving from the next financial year. Despite the short-term headwinds, our growth on a flown basis was at 7.2% quarter on quarter, outpaced the market growth of 6%. allowing us to consolidate our market share at 30% plus levels in the domestic air market. As to our international air ticketing business, we have not only fully recovered, but have started to grow above the pre-pandemic peak. We continue to innovate and enhance our product proposition. With demand for business and premium economy tickets showing an increasing trend, we have now completely revamped the business class funnel for international flights to provide an enhanced booking experience to our premium users and cater to their specific needs and preferences. We have introduced an industry-first enhanced booking process for business class flight tickets, where customers can preview visuals of cabin comfort, meals, in-flight entertainment, and other amenities. Customers also have a comprehensive view of the extensive business fair inclusions, including lounge access, shower services, and priority services, and can also preview airline miles points before finalizing the booking. It is early days, but we have started to see increasing engagement on our listing pages. Additionally, we have further strengthened our UAE proposition wherein customers now have the option to seamlessly buy eVisa for UAE during their international flight booking process on our desktop site. The initial response to this has been positive and this feature will soon be launched on our apps as well. Finally, we have further enhanced our price lock feature to now include multi-contract price lock where customers can choose from different time durations for which the prices can be locked. Our accommodation business, which includes hotels, homestays, and packages, witnessed strong year-on-year and quarter-on-quarter growth in the seasonally strong quarter as well. During the quarter, we touched our highest ever single-night check-ins of close to about 200,000 people on the back of strong holiday demand. We sold over 63,000 unique domestic hotels across 1,760 cities, giving us unparalleled reach and penetration within India. On the supply side, we continue to expand our supply and we now offer over 78,000 domestic properties on our platform. Our international outbound business continues to scale well. During the quarter, new direct flights to various destinations like Tashtan, Baku and Bali have been announced and key international holiday destinations like Thailand, Sri Lanka and Malaysia have announced waiver of visa for Indian travellers. This is likely to fuel greater demand for these international destinations in the times to come. On customer experience side, we enhanced the multi-room booking experience. Users are now shown more suitable room combination suggestions, and they can specify their preferences explicitly, thus simplifying their decision-making process. We have also started offering super value packages, bundling various value-added services with the hotel room, which will help bring more value for the customers. Our homestay business continues to grow with increasing coverage of destinations and increasing customer awareness via our category building marketing efforts. During the quarter, we sold about 16,500 plus unique properties across 800 plus unique destinations. Our holiday packages business continues to scale on the back of our innovative offerings. We have started building on our spiritual tourism product. During the quarter, we launched a Yodaya train charter product with 800 passengers. We plan to scale this and other similar offerings in the coming quarters. For outbound packages, Bali and Singapore were the top destinations and witnessed strong growth, while new destinations like South Africa, Japan, Kenya have started to grow meaningfully. Our bus ticketing business witnessed robust growth in Q3. Redbus is now also available in Hindi, giving us a higher share of new customers from Tier 2 and 3 towns, particularly for bookings on RTCs. We continue to work with various state road transport corporations, to bring them online. The government-controlled bus inventory on our platform has increased meaningfully with the onboarding of UP State RTC and additional inventory being made live by Kerala and Telangana RTCs. A new RTC, Chandigarh Transport Undertaking, has also come onto the platform in this quarter. We have undertaken tech optimization to improve real-time inventory status for RTCs to lower booking errors. The overall sentiment amongst private bus operators is also very positive now, and we expect a steady increase in private bus supply over the next few quarters and should help drive growth. On our Red Rail app, we are acquiring new customers in Tier 2 and 3 towns. driven by our continued efforts to scale up acquisition, seasonal demand, and driving organic growth by leveraging the Redbus user base. As a result, we continue to gain market share in train bookings on the back of all our three brands. Leveraging on the strength of our extensive inventory, we launched a connected travel feature for users to discover confirmed travel options through bus and rail combinations on routes that have lower availability or lesser frequency of trains. Let me now share some details on our brand campaigns during this high season quarter. We leveraged the ICC World Cup, which was held in India, with multiple brand campaigns to build and maintain top-of-the-mind recall and showcase our value proposition to our existing and potential customers. During the quarter, Make My Trip launched campaigns around hotels and homestays, while Goi Vivo launched its campaign with Kareena Kapoor, a well-known Bollywood celebrity. as brand ambassador. During the quarter, we also integrated BookMyForex product offerings on the MMP platform and launched a new brand campaign to drive Forex demand on our platforms. Our corporate travel business, we have both our platforms, MyBiz and Quest2Travel, are scaling up steadily with every passing quarter. Our active SME corporate customers count on MyBiz is now over 56,000, and for Q2T, the active customer count has reached 334 large corporates. We continue to innovate our product offering based on customer feedback. We recently reimagined our MyBiz homepage, offering the corporates the capability to customize the homepage according to their preferences in terms of theme and layout. Additionally, we have now provided the option to users to enter their preferences in terms of seats and frequent flyer numbers, leading to greater personalization for corporate employees on the platform. We have also enhanced our workflow to include ground transport options in our corporate offerings. With this, let me now hand over the call to Mohit for the financial highlights of the quarter. Thank you.

Thanks, Rajesh. And hello, everyone. During the first quarter of this fiscal year 2024, I had called out that while the pandemic is now well and truly behind us, The business is well positioned to leverage the investments made during the pandemic-impacted years in key strategic areas such as building wider offering of travel and travel-related services, driving supply-side expansion and choices for our customers, and the technology investments in building efficiencies, improved personalization, and curated platforms to scale new demand segments. It is heartening that these have helped us achieve multiple milestone numbers across financial and operating metrics such as gross bookings, revenues, and operating profits during this seasonally strong quarter. Gross bookings for the quarter grew by 21.7% year on year in constant currency terms to an all-time quarterly high of $2.1 billion compared to $1.7 billion in the same quarter last year. Revenue as per IFRS grew by 26.9% year-on-year in constant currency terms to $14.2 million from $170.5 million in same quarter last year. EBITDA witnessed strong growth and has more than doubled to $29.4 million as compared to $14.3 million during the same quarter last year. Existed operating profit or adjusted EBIT registered a growth of about 70% year-on-year and reached $33.4 million compared to $19.7 million in the same quarter last year. Adjusted operating margin for the business has expanded by about 50 basis points to 1.6% of gross bookings compared to about 1.1% during the same quarter last year. On a Y2D basis as well, the adjusted operating margin stands at 1.55% versus 1.05% in the first three quarters of the previous year. A-ticketing gross bookings for the quarter came in at $1.3 billion, witnessing a year-on-year growth of 19.8% in constant currency. Adjusted margin stood at about $79.2 million, registering a year-on-year growth of 14.2% in constant currency. Take rates for the A-ticketing business were in line at about 6.3%, as mentioned by Rajesh. While the longer-term outlook for growth in the domestic aviation market is strong, With large aircraft outdoors having been placed by the leading carriers, there are short-term capacity headwinds given issues around supply and servicing of aircraft engines. We expect that these headwinds will start easing out by the next financial year. Gross bookings for the quarter for the hotels and packages segment came in at $559 million, witnessing a strong growth of 27% year-on-year on constant currency basis. Linked to seasonality and improved pricing, the adjusted margin growth came in much stronger at 38.8% year-on-year on constant currency terms and stood at $98.8 million during the quarter. Take rates for the quarter were in line at about 17.7% in this segment. we witnessed strong growth across both domestic and international destinations with our international hotel business surpassing the pre-pandemic peak. We continue to work on sharper targeting of various demand segments via a multi-platform approach while also increasing the breadth of our offering through directly contracted hotels, both in the domestic as well as the international markets. This two-pronged approach is helping us drive strong growth in this business segment. In our bus ticketing business, gross bookings for the quarter stood at $269.8 million, growing at 20.3% year-on-year in constant currency terms. Adjusted margin stood at $26.9 million, registering a strong year-on-year growth of over 33.8% in constant currency. Take rates for the bus business again came in line at about 10% for the quarter. During this high season quarter, we invested behind our brand campaigns to drive top of mind recall for our brands, further thus helping us increase the mix of organic traffic. As a result, the marketing and sales promotion costs for the quarter came in slightly higher at 4.9% compared to the 4.6% in the previous low season quarter, but were lower than the 5.2% in the comparable quarter of last year. While the return on these brand campaigns tends to build over a longer duration, the initial response has been positive and should help us continue to target around 70% of our orders coming in from our existing customers or via repeat orders. All other costs were largely in line and we continue to drive year-on-year efficiencies in our fixed cost base. Another highlight of the quarter was our strong working capital management during peak seasonality. While the previous quarter had seen a deployment of about $12 million in working capital as we were getting into peak seasonality, we saw a much higher working capital release of about $35 million during this quarter. Accordingly, compared to the $37 million in cash operating profits for the quarter, the cash position has improved by almost $70 million over the previous quarter, taking our total cash position to about $608 million at the end of the quarter. During the last quarter, we announced the signing of the agreement to take a majority position in Savari car rentals and I am happy to report that the transaction was concluded by early December. The teams are working on consolidating all this supply with Savari and thereby driving efficiencies in supply acquisition and management. With this, we expect to drive much better efficiencies in our supply acquisition, facilitating the scaling up of our intercity cab business. We recently filed an intimation for our 2028 note holders on their right to tender the notes for repurchase at par by the company at the end of the third year of the notes as per the terms and conditions of the indenture on 15th February 2024. We shall update the progress of the tender process in due course. With that, I'd like to turn the call back to Vipul for Q&A.