Skift Take
India’s federal budget released last week was a disappointment, but one bright spot was that IndiGo, MakeMyTrip and IHCL all reported profitable quarters in their earnings calls.
Peden Doma Bhutia
Skift Asia Editor Peden Doma Bhutia and India reporter Bulbul Dhawan break down key takeaways from India’s recently announced Union Budget and the financial results calls of IndiGo, MakeMyTrip and Indian Hotels Company Limited (IHCL). Find out how the budget fared compared to travel industry players’ expectations in the latest episode of Skift’s India Travel Podcast.
Key Point
India’s Budget and Tourism Sector: The Budget 2025 presented by Finance Minister Nirmala Sitharaman fell short of travel industry expectations. The budget focused on developing temples in Bihar and Odisha as tourism hubs. Key demands of the industry like industry status for tourism and uniformity of hotel tax rates were ignored. Madhavan Menon of Thomas Cook (India) expressed disappointment that the advertising budget for inbound tourism, which was earlier cut by 97%, has not been restored.
Taj parent IHCL enters branded residences: Indian Hotels Company Limited (IHCL) is entering the branded residences market, starting with the Taj Branded Residences in Chennai. CEO Puneet Chatwal highlighted the lucrative potential of this segment, which has a market value of INR 220 billion ($2.6 billion) and is growing every year. IHCL is launching its re-envisioned Gateway brand with 15 hotels and plans to expand to 100 by 2030. The company aims to open 25 hotels this fiscal, with seven already open.
IndiGo’s premium shift and digital upgrade: IndiGo is strengthening its digital platform and introducing an AI booking assistant on WhatsApp. The airline plans to offer in-flight entertainment through its app, which is currently being tested on the Delhi-Goa route. Net profit for the quarter ended June 30 fell 12% to INR 27.3 billion ($326 million), but IndiGo is expanding internationally. IndiGo is ramping up flights to Central Asia and other destinations, aiming for double-digit growth in fiscal 2025.
MakeMyTrip focuses on rising middle class: MakeMyTrip reported record quarterly total bookings, revenue and adjusted operating profit, with gross bookings exceeding $2.4 billion, up 22% year-over-year. CEO Rajesh Magow attributed this to the rise of India’s middle class, increasing disposable income and changing travel behavior. Emerging markets such as Turkey and Kazakhstan have seen a strong increase in Indian tourism, signaling a positive long-term outlook for international travel from India.
Episode Summary
The episode centred around the recent revenue report and the FY25 Budget. The Union Budget’s lack of key measures for tourism, such as industry status and uniform tax rates for hotels, left the Indian travel industry disappointed. Madhavan Menon of Thomas Cook (India) expressed disappointment over the failure to revive advertising budgets for promoting inbound tourism abroad.
Indian Hotels Company Limited (IHCL) has announced its foray into the branded residences market with the opening of its first Taj branded residence in Chennai, with CEO Puneet Chatwal noting that this market has the potential to witness significant growth. IHCL is also launching a re-envisioned Gateway brand and plans to open 25 hotels this financial year.
IndiGo continues its premium shift, introducing major digital upgrades and in-flight entertainment plans. Despite a 12% drop in net profit, the airline is expanding international routes and targeting double-digit growth in fiscal 2025.
MakeMyTrip reported record profits with total bookings up 22% year-on-year. CEO Rajesh Magoo highlighted that India’s growing middle class and changing travel behaviour are influencing domestic and international travel trends, with emerging destinations such as Turkey and Kazakhstan seeing a surge in Indian tourists.
