War, weak rupee and high fares hit India’s travel firms as demand softens

India’s online travel companies—MakeMyTrip, ixigo, and Yatra—experienced revenue declines in air ticketing during the March quarter, driven by slowing demand, geopolitical disruptions, and a weaker rupee. Aviation accounts for 25-30% of their total revenue, making the sector particularly vulnerable. MakeMyTrip reported a 2% sequential drop in air ticketing revenue to $58.73 million, a nearly 5% year-on-year decline, citing a 6.2% fall in gross bookings and currency depreciation. Ixigo saw revenue from air ticketing fall 6.5% sequentially to ₹95.7 crore, while Yatra’s aviation revenue declined 1% sequentially to ₹60.6 crore, though it remained 5% higher than the prior year. The shift in travel patterns reflects broader challenges, including geopolitical tensions in West Asia and rising international airfares. Travelers are increasingly avoiding expensive Western destinations in favor of more affordable options like Thailand, Malaysia, Singapore, Bali, and the Philippines. Cleartrip noted a threefold increase in bookings to the Philippines this summer. MakeMyTrip’s co-founder, Rajesh Magow, observed that demand for Western routes weakened starting in March, with travelers adjusting plans toward eastbound and domestic trips. The decline follows seasonal weakness in aviation revenues over the past two quarters, with MakeMyTrip and Yatra reporting softer performance in previous periods. Ixigo’s chairman, Aloke Bajpai, described the quarter as difficult for aviation globally, while Yatra’s CEO, Siddhartha Gupta, attributed the slowdown to geopolitical disruptions and war-related uncertainty, particularly in MICE (meetings, incentives, conferences, and exhibitions) travel. Some corporate bookings were deferred or canceled, though management expects demand to recover as conditions stabilize. The weaker rupee has further exacerbated costs, reducing revenue per booking as companies offer higher discounts and face rising customer acquisition expenses. MakeMyTrip’s sequential decline in air ticketing revenue highlights the pressure on international travel, while ixigo’s earnings reflect broader challenges in maintaining margins amid shifting consumer behavior. The travel industry’s pivot toward domestic and Southeast Asian destinations underscores the immediate impact of geopolitical and economic factors on global travel trends.