West Asia crisis, weak rupee hit online travel platforms

India’s online travel companies including MakeMyTrip, ixigo and Yatra are starting to feel the strain from slowing air travel demand as the war in West Asia, higher international airfares, and a weaker rupee hurt their air travel business in the March quarter.

- Abhishek Law

Aviation comprises 25-30% of revenue for these companies.

This is prompting a notable pivot in consumer behavior, with travelers increasingly shunning expensive Western routes in favor of more affordable domestic and Southeast Asian destinations.

The pressure follows seasonal weakness in aviation revenues over the previous two quarters. MakeMyTrip saw a sequential decline in air ticketing revenue in the December quarter, while both Yatra and ixigo reported softer aviation performance in the September quarter.

In March, Nasdaq-listed MakeMyTrip reported a more than 2% sequential decline in air ticketing revenue to $58.73 million from $60.07 million in the previous quarter. Revenue fell nearly 5% year-on-year.

“The decrease in revenue (year-on-year) in absolute terms from our air ticketing business was primarily due to a decrease in gross bookings (by 6.2%) primarily driven by a 1.8% decrease in the number of air ticketing flight segments and the depreciation of the Indian rupee against the dollar during the quarter,” the company said in a statement accompanying its results.