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Fastest-growing Domestic OTA; Sustained Share Gain Opportunity

IXIGO has emerged as the fastest-growing online travel agency (OTA) in India, delivering 25% YoY GTV growth in FY26, significantly ahead of the industry growth, supported by strong traction across its key segments — trains, flights and buses. The company has strengthened its position in the Train OTA segment with ~63% OTA share, while its partnership with IRCTC benefits both platforms through greater customer reach and enhanced monetisation opportunities. Flights growth is supported by rising regional connectivity, strong Tier-2/3 penetration and increasing ancillary monetisation. Buses represents the largest incremental growth opportunity, with 45.0% expected GTV growth in FY26-29E as direct integrations with private operators and partnerships with State Road Transport Corporation (SRTC) creates a differentiated supply-side moat. Overall, we anticipate ~23.0% GTV CAGR over FY26–29E, led by ~45% Bus and ~20.5% Flight GTV CAGR, supported by online penetration and market-share gains

Focus on Next Billion Users & Cross-sell Opportunities to Drive long-term Growth

IXIGO has differentiated itself from traditional OTAs by targeting the Next Billion Users (NBU) across Tier-1/2/3 cities, with its early focus on rail travel helping build a large and loyal customer base. Its House of Brands strategy i.e. IXIGO Flights, IXIGO Trains, ConfirmTkt and AbhiBus enables segment-specific customer acquisition while API integration across platforms facilitates cross-selling of flights, buses and other travel products. We believe IXIGO’s strong rail franchise and NBU-focused user base provides a strong platform to cross-sell higher-value travel products and drive monetisation. With online penetration in India’s mid-market and budget hotel segment at only ~10%, the hotel OTA segment represents a significant long-term opportunity. The key opportunity is therefore not merely acquiring more travellers but increasing the travel wallet captured per existing user.

Operating Leverage to Drive Sustained Margin Expansion

IXIGO’s mature OTA business generates healthy contribution margin, supported by direct operator integrations, ancillary monetisation and disciplined cost management, providing meaningful operating leverage that is being reinvested into scaling up the Hotel OTA segment. We expect IXIGO to sustain elevated growth investments in the near term, particularly towards the Hotel OTA business, customer incentives and third-party distribution partnerships. Consequently, segmental contribution margin is likely to stabilise at ~40%/33%/52% for flights, trains and buses, respectively, in FY27E, broadly in line with to marginally below FY26 levels. Over the medium term, we expect consolidated contribution margin to expand, supported by a rising share of the structurally higher-margin OTA segments. Accordingly, we expect gradual margin expansion, with EBITDA margin improving from ~5.9% in FY26 to 11.2% by FY29E.

Investment View:

We believe IXIGO is well-positioned to sustain strong growth, supported by its leadership in Train OTA and deepening penetration in Flights and Bus OTA, while its focus on Next Billion Users provides access to an underpenetrated Tier-2/3 customer base. From a valuation perspective, we believe IXIGO deserves a premium multiple to traditional OTA peers given its stronger growth profile, differentiated customer base, structural share-gain opportunity and potential for margin expansion. While the Hotel OTA scale-up may limit near-term margin expansion, we forecast Revenue/EBITDA/PAT CAGR of 26.0%/55.8%/53.0% over FY26–FY29E. We initiate coverage with an ‘ADD’ rating and value IXIGO at 35x average FY28E/FY29E EPS, arriving at a TP of INR 190, implying 18.0% upside, with PEG ratio remaining below 1x.

Optionality:

Better-than-expected scale-up of the Hotels OTA business and increasing monetisation through ancillary services and AI-led travel offering.

Key risks:

Prolonged Middle East tension, strong competition from large OTA players, execution risk in the hotel OTA business.

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