Welcome to our fiscal '26 Second Quarter Earnings Webinar. Today's event will be hosted by the company's leadership team comprising Rajesh Magow, our Co-Founder and Group Chief Executive Officer; Mohit Kabra, our Group Chief Operating Officer; and Dipak Bohra, who has recently joined us as 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 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 the U.S. Private Securities Litigation Reform Act of 1995. These statements are not guarantee 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 is 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 June 16, 2025. Copies of these filings are available from the SEC or from the company's Investor Relations department. I would like to now turn the call over to Rajesh. Over to you, Rajesh.

Thank you, Vipul. Welcome, everyone, to our second quarter call for fiscal 2026. As you will recall, Q1 was impacted by a series of exceptional external events such as geopolitical tensions post the unfortunate Pahalgam terrorist attack on tourists and the tragic airplane crash at Ahmedabad. These events impacted the consumer sentiment for travel, especially for leisure. Additionally, supply side constraints continue to impact the domestic aviation market growth in Q1. I am happy to report, however, that as we entered Q2, the broader travel and tourism demand started to rebound across travel segments despite Q2 being a seasonally slow quarter. And our diversified product portfolio covering all travel customer segments of retail as well as corporate customers helped us deliver strong overall performance in the quarter. Barring the domestic air markets slow recovery due to temporary supply constraints where we continue to maintain our market share of 30% plus levels. All other modes of transport segments like bus, rail, camps and international air witnessed robust growth. Consequently, we saw a robust growth in our hotels and [ ACCO ] business, both for domestic and international travel segments as well. Our adjusted operating profit for the quarter was at $44.2 million, witnessing growth of 18% year-on-year. Consumer sentiment towards travel remains positive, supported by high propensity of experiential getaways and short breaks. In air segment, international outbound travel from India presents a significant growth opportunity. Being an unpenetrated segment for an online perspective, we remain focused on growing this segment. in Q2 fiscal year '26, our international air ticketing revenue grew by over 29.6% year-on-year in constant currency terms, far outpacing industry growth. Similarly, our international hotels revenue grew by over 42% year-on-year. Our international business now contributes 28% to the overall revenue, up from 25% during the same period…

Thanks, Rajesh. Welcome onboard, Dipak and hello, everyone. The last 2 months of the previous quarter that in May and June were impacted by a series of external events and the weak sentiment for domestic air travels spilled over into the reported quarter due to continued supply constraints leading to a market degrowth of about 3% year-on-year in the domestic air market. Quarter 2, which is generally a low season quarter was also impacted by excessive rainfall, particularly in some of the North Indian states and union territories like Jammu & Kashmir, Laddakh, Himachal Pradesh, et cetera, which led to a degrowth in the 20s in these regions on a year-on-year basis during the quarter. Despite these macro conditions, we leveraged our one-stop shop approach across travel services to drive growth why accommodation other transport segments like bus ticketing to make the most of the overall bounce back travel demand during the quarter. As a result, the highlights of the quarter were hotels and packages adjusted margin growth, which accelerated from 16.3% year-on-year in Q1 to 21.6% year-on-year in constant currency during the reported quarter. Within this segment, the stand-alone hotels adjusted margin growth accelerated from 18.5% in the previous quarter to 23.1%. In the nonflight transport business, bus ticketing adjusted margin growth increased from 34.1% year-on-year in the previous quarter to 44.1% year-on-year in constant currency during this quarter. Before I get into the financial details, I would also like to call out a couple of accounting items in this quarter for a better understanding of the results that we are calling out right now. You would recall that last quarter, we had raised an additional capital of approximately $3.1 billion through a mix of primary offering of ordinary shares as well as convertible sernior notes maturing in 2030.…

Thanks, Mohit. [Operator Instructions] The first question comes from the line of Sachin Salgaonkar of Bank of America.

Can you hear me?

Yes, go ahead.

I have 3 questions. First question is on the air capacity issue basis. Our understanding, it looks like most of the Air India planes are back and not all Indigo planes are back. So just wanted to understand where are we on the air capacity issue? And how should we expect demand going ahead, particularly for the December quarter?

Yes. Maybe I can take that, Sachin. So as I think it was there in my script, I was reading out. So in the current quarter, what is expected is that as far as domestic air market is concerned, that the daily departures will get back to about 3,200 plus, which is similar to the same period last year. That is as far as domestic. Now this data is obviously -- this is the -- it's quite informed data this basis, the inputs that we have from the we have from the airlines, which I think it's a good start. Ideally, obviously, we wanted it to grow, but as you know, this quarter, there was a dip 2, 3 percentage points. But now if it gets back to the same level, it's a decent start, and this is also -- it is because of the -- because of what you mentioned, right? So some planes are coming back and the others are coming back slowly. But very interestingly, worth also mentioning is that this is as far as domestic air market is concerned, but for international air in this quarter as compared to the same quarter last year, the number of departures actually went up about 30 departures daily departures went up. And out of that, the two main noticeable countries where it went up significantly was actually Thailand and UA, which are effectively the sweet spot for us and also for the overall Indian travel market for outbound. So as far as international is concerned, it's doing well. It's back. As far as domestic is concerned, constraints still remains, hoping it will lift soon.

Very clear. And there are 2 parts elements going into the December quarter, right? One, what you highlighted right now, which is not the entire supply is up, but on the second hand, we are actually seeing benefits coming from a GST perspective. I would love to understand from you actually, are these because on the face of it, clearly, you should see GST benefits. But in terms of advanced booking and others, are we seeing this December turning out to be slightly better as compared to, let's say, December last year, purely on the back of more money in the hands of consumers?

Yes, I would say, Sachin, I think it's a decent start, but in all fairness for our category, specifically for travel, while for the other nontravel categories, a lot of the shopping and the consumption picks up before Diwali. For travel, it picks up actually after Diwali. And therefore, we will have to just wait and watch for a little bit more time. But early signs are clearly there. Like I think we should just look at this overall consumption both story, mostly looking at an overall GST reduction that has been announced sort of across the categories, which effectively put small money into your pockets. And that coupled with the fact that there is more desire to travel. I'm quite optimistic that travel as a category will also benefit out of this overall sort of GST reduction and more disposable income in consumers hands.

Sachin, let me just add, as you know, the advanced purchase window, particularly in India on travel is not very high. And as a result, it's kind of a bit more bookings, which happened in the last week or so ahead of scheduled travel. And therefore, it's kind of slightly difficult to call out in terms of future bookings in our kind of a market. But like Rajesh called out, it's a very positive development. And if you look at it from an Indian traveler point of view, our kind of average ASP on the hotel accommodations tends to be below the 7,500 kind of price point on which the GST reduction has been announced. So therefore, this will actually benefit bulk of the bookings. So to that extent, it should be a very positive development on driving kind of travel demand overall in the coming quarters.

Very clear. Second question, marketing expenses clearly increased and moved to 5.2% as a percentage of gross bookings. I just wanted to confirm that this is mainly on the back of a slower consumer spend and less to do with competitive intensity. Is that a fair observation? .

See, I'll just call out that if you -- it's also got to kind of look at the overall marketing and sales conversion spending in tandem with our kind of segment margins. And like I called out across the Board, across segments, we have actually seen margins strengthening and particularly in weaker seasonality like Q2, this tends to happen. And both on a quarter-on-quarter basis as well as a year-on-year basis, we have actually improved margins and therefore, to some extent, that's also been kind of -- that's also got deployed. But with the improved mix across segments and the improved margins across segments, this actually is kind of pretty much in line in terms of the call out that we had made.

Got it. And then on this -- the improvement in margin, is it seasonal? And should it normalize going ahead? Or we should see the take rate improvement continuing both that they had and hotels going ahead? .

To some extent, it remains seasonal because depending upon high and low seasonality, there is, at times, a little bit of a variation. And then all the more so in the current fiscal year because like we have been talking, the mix of air has been reducing. I mean for unwanted reasons because the overall market is supply constrained and here is the least kind of margin in terms of segmental margins per se. Therefore, overall margins have only improved, right? And that is something that we kind of taken care of. Going forward, if fair rebounces, the blended margin might kind of go down a little bit, but across categories, we still kind of expect margins to remain largely in line with what they have been.

Yes. Got it. Third question on buyback. I just wanted to understand whether you guys have repurchased any stock in this quarter. And I know historically, you guys said that there is a thought process to opportunistically look to buy back. So I was looking to understand any buyback happened in this quarter?

So Sachin, nothing that has happened through the quarter as would have got reported and therefore, we called out that we've not kind of been able to do any buybacks in the current quarter. But we made certain changes to the buyback program. One, we've kind of now made it slightly more longer term kind of extending the buyback program up to fiscal year ending 31st March 2030, so that we have a window over for the next 4.5 years. The current buyback program had a balance left of over $114 million. We've increased that to $200 million and also increase the annual limit, which was earlier about $60 million or so to about $100 million, so that we can deploy a little more on the buyback program. And we've also included the the 2030 notes, the recently issued convertible notes mature in 2030 in the program so that we could kind of also buy back the CPs, which were recently issued. So making it more comprehensive across the -- across shares as well as both the convertible note offerings, which we have done in the past. So that's what I wanted to share. So I think we'll keep looking for opportunistic buybacks across shares and notes in the remainder part of the year.

And Mohit, just to clarify, is it across both Class A and Class B shares? Are you at some point in the future if you want to buy C strip shares, this could be done as a part of this buyback?

Actually, since the Class B shares handled by one investor and the strategic investor. We have not included that, so that there is absolute clarity that we're looking at repurchase program deployment in the normal course happening for Class A or for the convertible notes. Should we be kind of doing any repurchase programs on the Class B shares, we'll call it out specifically in that particular period, just like we did it in the previous quarter.

Got it. And lastly, obviously, with this incremental $43 million kind of a finance cost going ahead as well, from a positive net income. Is it fair to say that going ahead, we should see sort of a negative net income, although your free cash flow doesn't change. But optically, you do see a sort of a negative net income at the company going ahead also? .

No, absolutely. And therefore, I had called out the nuance around this. And as you know, these are actually zero coupon bonds. So it's more kind of in a manner of so notional interest cost, which is kind of being charged to the P&L, basis the effective interest methodology under IFRS. But as such, there is no real interest being paid whether in cash or in any other form. So I just wanted to call that out.

Next question is from the line of Manish Adukia from Goldman Sachs.

So my first question is on the overall growth profile of the business now. 1/4 of your business is from the domestic air in terms of revenue contribution, and that's not growing at all for almost 2 quarters in a row. But despite that, you have 20% overall revenue growth because other segments are doing well. Now when we think about medium to long-term growth outlook, where you said Indian market grows 8% to 10% and you can go 2x you're already in line with the medium, long-term growth outlook. But as domestic air improves, shouldn't we expect that the 20% revenue growth number further accelerates from here? Or you think that the bus segment, et cetera, outbound may decelerate from the current base, so even though domestic air may improve overall growth on revenues for the company probably remains around 20% level. So just wanted to get your puts and takes around that debate. .

Happy Diwali, Manish as well. And great question. And I think one of the advantage is that we kind of keep calling out for ourselves is that we are a one-stop shop in terms of travel services or ancillary services. And what that allows us is just in days, there is kind of weakness in any particular segment, there is an ability to try and drive incremental growth through the other segments. And similarly, if you look at it on the demand side also, having kind of multiple platforms are getting, say, across retail, B2B and corporate kind of demand, there's opportunity to kind of leverage is demand segment depending upon whether there is weakness in any of them and therefore, dial up the other ones. So I think we'll continue to do that. Hopefully, if you really see, despite these tough macro conditions, we've still been able to kind of post the -- post growth in the 20s. And therefore, like we had mentioned in the last quarter also, we do remain positive and hopeful that we'll be growing in the 20s for the full fiscal year despite the the one-offs for the first half of the year. And hopefully, if we kind of air kind of domestic air in particular bounces back, we hope that we are able to inch up the overall growth from being at the low end of 20s to kind of being more closer to the mid-end of the '20s. So let's see. It's very difficult to call out how each of the segments will kind of behave whether on the supply side or the demand side, but yes, the overall strategy is to kind of keep driving growth in the 20s in medium to long term.

Sure. And maybe a follow-up on that. I think you're seeing growth in the 20s for the full fiscal year and to confirm is, despite the fact that March quarter should have a very strong base because of Kumbh last year, which would have impacted almost all your segments quite positively. So despite that, for the full year, Q1 19%, Q2, 20% and you're saying overall full fiscal still should end up 20% despite this, just to confirm. .

Absolutely, Manish. And I know there are these kind of one-offs that we had in the previous quarter on the positive side, and we have had a few negative kind of one-offs in this year, particularly in H1, but we are still keeping fingers crossed and hoping that we'll kind of continue to grow in the -- to grow in the 20s.

Right. My second question is on competition and at an overall level, right? I mean, used to be your largest shareholder until a few years ago, and now they have acquired a significant minority stake in one of your competitors, and at least a publicly available data on n bus volumes, of course, of a low base, they seem to have grown faster than you over the last 3 or 4 quarters. So anything to read into that? And how should we think about any new entrants ability to also maybe expand into the hotel segment and potential competitive intensity in that going forward? Your thoughts there would be helpful. .

Couple of thoughts over there. One, overall, I would say it's always good to see increasing industrial investments in the travel industry as such, right? So it's a welcome sign. In fact, if you look at it from a -- from our own kind of vantage point of view, just last quarter, we had almost done like a $3.1 billion transaction, but that was essentially to kind of repurchase Class B shares, right? And while we are initially budgeted to deploy at close to about $100 million from the balance sheet, but we didn't have to do this and we have the significant interest that we saw on the primary offerings to fund the repurchase. So I think clearly, there is increasing interest in the overall travel industry. And if you look at it, overall, India, again, is a very kind of a very large market growing well and then there is also kind of an opportunity for driving online penetration. Although I would say that the segments which kind of, I would say, initially of online penetration have changed. So 10 years back, it might have been more accommodation, which was maybe in the early single digits of online penetration. And therefore, same competitive intensity growing much higher in that segment about a decade back. But today, those segments have changed. And if you know, as we have been calling out, we have ourselves been pretty aggressive in terms of driving online penetration, adding a lot more new segments and new travel services, ancillary services on the platform. So I don't really see any big concern. And the other fact is also that over the last few years, if you look at it, we have continuously invested behind driving online penetration across segments, whether it is transport, whether it is accommodation or whether it is other ancillary travel services, we have been doing that on a consistent basis. And whenever any other players in the market have also done that, we have generally ended up gaining on account of the overall expense because ultimately, these are category driving spend. And as a market leader, you tend to gain if the overall kind of investments in driving online penetration goes up. So we think of it more on those terms and remain pretty much kind of stay on course on our own -- driving our own agenda, which is largely to say that we keep driving growth much ahead of the industry growth at a significant multiple and we continue to be market leader across kind of travel segments, whether it is transport, whether it is accommodation or ancillary services, making sure that both MakeMyTrip and Goibibo, they remain the top to OTA brands and redBus remains pretty much the top ground transport brand for all Indian travelers. So that's the broader kind of response that I would have. We don't see much of change.

No, I think you've covered it all. I'll maybe just add one more point. Manish, if you go back in history a little bit and go deeper, you would realize that the share shift, I mean, firstly, the investments have come in. It's not for the first time investment has not come in the travel and tourism market and specifically in the OTA segment have come in the past. Disruptive investments have also gone in the past. But if you really see from an OTA standpoint, you would see at least an Indian OTA market. The share shift has happened in the say between the existing players and the new or challenges that sometimes appears and not necessarily, we've seen impact on either the growth rate or the market share gain over the years. And that's because of the fact that, one, of course, we will have to continuously keep executing our strategy as well and keep innovating for consumer experience all the time. But also the fact that over the years that the brand is -- and in the consumers' mind, all our 3 brands have got established very, very firmly and which obviously gives you sort of the benefit from a sort of dealing with any of the new competition perspective, et cetera, as well. So I think we should just keep that thing also in mind I guess, both the points. One, that this is not the first time investment when investment comes in overall market grows, which is good news. And then historically, if you really go deeper, you would realize that the share shift has happened pretty much if at all, within the sort of existing players and the newcomers and then that cumulatively, it doesn't really change too much.

The next question is from the line of Aditya Suresh of Macquarie.

I have two questions. So first is just on the guidance in itself. So when we speak about 20%, can you just reiterate again at what line are you speaking about it on account terms, gross working adjusted revenue, overall revenue because I think there are distinctly different kind of dynamics, which are at play, depending on which trend you're looking at because even if I look at overall gross bookings, we're now the first 6 months, sub-10%, right? So can you sort of clarify that the guidance in itself, when you speak about 20%, what you're specifically referring to? .

Yes, Aditya, while there is no -- I mean we don't necessarily kind of going to put out a guidance, but more directionally, how are we kind of seeing growth coming in. And that's in terms of the adjusted margin that we report. So if you look at through the script also, we have called out the adjusted margin growth, and it's slightly on that metric that we kind of are going to look at it. And the simple reason being adjusted margin is kind of the number, which is kind of called out in line with how kind of OTA revenues are looked worldwide across segments because we do have some segments where we report on a gross basis, say, for instance, on the package side. And similarly, we do have kind of a certain amount of customer equation spends, which are otherwise can be treated as deductions from revenue from an IFRS basis point of view. So it is an adjusted margin basis that we are calling out. And if you look at it, adjusted margin across segments, then this is broadly the trajectory that we're kind of looking at. Now this might come in in terms of different adjusted margin growth across segments. But holistically, all the segments put together is where we are kind of looking at remaining in the 20s.

And then just specifically on hotels, right? So for this quarter, when I look at this in account terms, your number of bookings up 80% gross booking value was up 13%. IFRS 7 is up 5%, right? And I appreciate there are kind of foreign currency impacts here going on as well in that 5% revenue number that you're reporting. But clearly, there seems to be both as you're seeing more bookings, yes, but the value per booking is going down and also the take rate on that said booking is also going down, right? So can you like speak through that theme which you're observing?

Actually, not Aditya, maybe I'll just kind of give you once again, as I called out in the script also there's a lot of foreign currency translation impact, particularly in this quarter. Actually, the adjusted margin growth in our stand-alone hotels business, we just called out is at about 23.1% in the current quarter. And, it ended up significantly from the previous quarter, during which it was at about 18.5%. So the adjusted margin growth has come in much stronger and generally tends to come in better than the overall volume growth. Now this does change depending upon how the ASPs are behaving and how the overall kind of margin is trending in the category. This particular quarter, actually, even from a margin point of view, we saw a margin improvement coming through both on a quarter-on-quarter basis as well as on a year-on-year basis. So actually, it's held pretty well. And therefore, maybe I'll just guide you back to those sections of the script that I just called out just from a clarification point of view.

Okay. And then in terms of the ancillary business, right, so here, obviously, kind of higher take rate segments also forth. You've had a few new product launches in this quarter. So for example, something like experiences in city, which I think is new for you all have a Visa offering as well. Can you maybe speak about some of these new kind of revenue streams within ancillary services?

Actually, on the ancillary side or the other segment, if you look at it over the last couple of years, we are continuously guiding a variety of ancillary services. So I started with, say, maybe ForEx like about 3 years back, we've dialed up in the city over the last 2 years or so, we have now also kind of in this particular year, we had called out specifically that we would be kind of focusing on adding a lot of tools and activities on the experience side as part of the other segment. So yes, we'll continue to keep adding a lot more on this segment even going forward as well. So -- and you'll see that kind of called out. In fact, I had also -- in my script kind of called out that almost all the ancillary services, whether it is travel, insurance or ForEx, et cetera, have done well. And there are 2 kind of transport-led services in the other segment, which is largely cabs and more so intercity cabs and rails, which also have grown very well during the quarter. So the overall growth in the other category this quarter came in at about 29.7%. So broadly around the 30% mark. So continues to do very well.

The next question is from the line of Gaurav Rateria of Morgan Stanley.

Congrats on resilient performance in a tough macro environment. My first question is on your comment that you made that you would like MakeMyTrip to be the default search engine for travel. It's a pretty interesting comment. And also, you shared quite a bit of interesting metric around your engagement in the AI assistant. When I look at the measure of success over time, I thought that it would be the overall traffic increasing base of new customer acquisition improving and better repeat rates. When you look at some of the early trends, how have these metrics fair?

A very good point. And thank you, firstly, and happy Diwali to you too as well. And Gaurav, I have to say upfront, and like I said, right, it's beta launch and the insights are very encouraging. And right now, the phase is only to collect insights and see how do we sort of do 2 things. One, keep fine-tuning the product and keep improving the interaction so that the experience for the end consumer is very relevant, very personalized, very to the context, et cetera. . And the other is to also keep track and see how are they adopting to this new interface, specifically this Myra end-to-end, let's say, trip-planning tool that we were talking about. And the comment around we want MakeMyTrip to be the first port of call has always been there. But even in this new interface, more from trip planning perspective. So we've been perhaps the first port of call for the transactions, but also for the trip planning is our attempt the time around with this new interface. And I think it has a lot of sort of promise that it offers, and we'll see how it goes. But in terms of the success metrics that you talked about, ultimately, those are the 2 metrics that you just called out. We will see new user acquisition because we are looking at going really deeper and pushing the adoption through voice feature as well as vernacular. And as I mentioned, right now, Hindi and a lot of the English conversations happening, but we are looking at adding more regional conversations. And this time around, as we hear some of the quality of the calls and the handling by the -- by Myra, which is a digital agent it's very, very close to or even…

My second question is for Mohit. You've shared in the past profitability benchmark that you look to aspire, you've already reached that 1.8%. You had talked about 1.8% to 2% range. So in pursuit of balancing growth and profitability, how should we think about next 1 to 3 years in terms of this range, meaning what you said already? Or do you think there could be an upside to this range because you have already gotten to 1.8% in the current year? .

Yes, Gaurav, at least to begin with right now, like we've been saying, we do believe there is an opportunity to kind of dial up growth, particularly as say for instance, the domestic air ticketing district kind of bounces back to good growth. So that's something that we want to kind of keep in mind. And therefore, if you would ask me, at least in the shorter term, the focus would be a lot more will tilt towards kind of driving the growth agenda because even at 1.8%, like we have always called out, one of the rationales 1.8% to 2% was that even benchmark with the best-in-class in terms of the OTA margins globally with our kind of mix of segments between transport and accommodation with accommodation at about 40% ballpark. We do believe we'll compare with the best. However, longer term, like when you say the next 3 years or so, over the next 3 years, particularly if the mix of accommodation, goes up in the overall adjusted margin pie, which is expected to, then I don't see a reason why we should not have the potential to kind of put out a slightly better number than what we've already called out. But let's see. In the next few years should be an interesting journey on that count. .

We've almost run out of time. This was the last question over to you, Rajesh, for your closing comments.

Thank you. Thank you, Vipul, and thank you, everyone, once again. Thank you for your patience and good line of questioning. As always, we look forward to see you next quarter. Thank you. .

Thank you, everyone.

Thank you, everyone.