India’s travel and tourism sector is projected to experience robust double-digit growth in the upcoming years, with both domestic and international travel on the rise, according to Rajesh Magow, co-founder and group CEO of MakeMyTrip. Domestic flights have seen significant growth this year, driven by high demand and limited supply. However, Magow noted that short-term challenges, such as restricted flight availability and a growing preference for road travel due to enhanced infrastructure, may slightly temper the aviation sector’s expansion.
He stated, “The supply of airlines is constrained and is gradually increasing. Airline prices will stabilize once additional supply becomes available next year. The aviation sector may have also lost some ground to road transport, as the country’s road infrastructure improves.” Despite these challenges, Magow remains optimistic about the travel industry’s growth, forecasting an overall increase in travel and tourism of 10-15% over the next two to three years.
Regarding hotel rates, travelers may not see much relief during peak events, such as concerts and holiday seasons, although general hotel prices are expected to remain moderate. “This year, we have observed that hotel rates have only risen by 3-4% compared to the same period last year. Aside from major events and peak seasons, I don’t foresee hotel rates being a significant issue, especially with the increasing availability of alternative accommodations,” he added.
In its latest quarterly update, MakeMyTrip reported a 24.8% year-on-year revenue increase, reaching $267.4 million, fueled by heightened demand across various travel services, particularly in air ticketing (up 18.6%), hotels and packages (up 17.2%), and bus ticketing (up 31.7%). The company also experienced substantial growth in ancillary services, such as car rentals, rail, and insurance, which surged by 110.7%. Net profit for the quarter rose to $27.1 million, up from $24.2 million a year earlier, while adjusted net profit increased to $44.9 million, compared to $38.9 million in 2023.
Magow emphasized the growing importance of religious tourism for the company, noting a 20% increase in room nights sold at spiritual destinations in the final quarter of 2024. “In Uttar Pradesh, spiritual destinations saw a 40% growth, led by Ayodhya, Varanasi, and Prayagraj.
