MakeMyTrip profit falls 65% as finance costs triple
Revenue grew and profit did not. A rupee that fell more than 10 percent and interest on convertible notes did most of the damage.
- Revenue 285.6 million dollars, up 6.2 percent, or 16.1 percent in constant currency.
- Net profit down 64.7 percent to 9.1 million dollars; adjusted EBITDA 55.5 million dollars.
- Finance costs rose to 35 million dollars from 10.8 million on convertible note interest.
- Gross bookings 2.85 billion dollars, up 9.4 percent. Air ticketing fell 7.5 percent.
MakeMyTrip reported Q1 FY27 revenue of 285.6 million dollars, up 6.2 percent year on year, or 16.1 percent in constant currency. Net profit fell 64.7 percent to 9.1 million dollars, while adjusted EBITDA came in at 55.5 million dollars.
The gap between the two is explained mostly below the operating line. Finance costs rose to 35 million dollars from 10.8 million, driven by interest on convertible senior notes.
Segment performance was mixed. Hotels and packages contributed 151.2 million dollars, up 6.7 percent. Bus ticketing grew 15.9 percent to 44.9 million dollars and other lines rose 19.6 percent. Air ticketing fell 7.5 percent to 55.6 million dollars. Gross bookings reached 2.85 billion dollars, up 9.4 percent. The company pointed to a rupee depreciation of more than 10 percent and subdued international travel, offset by domestic demand.
Two things transfer to anyone selling in India. The constant currency gap, 6.2 percent reported against 16.1 percent underlying, is what a weak rupee does to a business earning in rupees and reporting in dollars. And a profit decline caused by financing rather than operations is a different problem from a demand one, though both land in the same headline.
Zane’s analysis draws on original reporting by Entrackr. Read the original report.