Ladies and gentlemen, good day and welcome to Le Travenues Technology, also known as ixigo, Q1 2026 and 2027 earnings conference call hosted by DAM Capital. This conference call may contain forward-looking statements about the company which are based on beliefs, opinions, and expectation of the company as on date of this call. These statements are not the guarantee of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Anmol Garg from DAM Capital. Thank you, and over to you, Anmol. Thank you, Danish. Good evening, everyone. On behalf of DAM Capital, I welcome you all to ixigo's Q1 FY 2027 earnings call. We have with us Mr. Aloke Bajpai, Chairman, MD, and Group CEO of the company, Mr. Rajnish Kumar, Director and the Group Co-CEO of the company, Mr. Saurabh Devendra Singh, Group CFO of the company. Before I hand over the call to Aloke, Saurabh, and Rajnish, I would like to highlight the safe harbor statement on the second slide of the presentation, it is assumed to be read and understood. I'll now hand over the call to you, Aloke. Thank you, and over to you, Aloke. Thank you. Good evening, everyone, thank you for joining us for ixigo's Q1 FY 2027 earnings call. If I had to describe this quarter in one sentence, I would say that it demonstrated the value of having more than one engine of growth. The external environment was not particularly cooperative. The Iran conflict affected not just international flights but also domestic ones through the second-order impact of oil prices on airfares. Aviation capacity remained constrained and airfares were at the highest levels we've seen. The train ticketing ecosystem continued to operate under policy constraints. Against this backdrop, our diversified platform continued to grow, our scaled businesses remained profitable, and we continued gaining share in all the categories we operate in. We finished the quarter with an all-time high GTV of INR 5,524 crores, up 19% YoY, revenue from operations of INR 356.75 crores, up 13% YoY, profit after tax of INR 34.24 crores, up 81% YoY. Our adjusted EBITDA came in at INR 29.24 crores, lower by 7% than the same quarter last year. This quarter also illustrates an important point about how we manage ixigo. We do not run each quarter to maximize the reported margin of that quarter. We try to maximize the long-term value of the platform while operating within disciplined financial guardrails. Our more mature businesses across trains, flights, and buses continue to generate operating leverage. We are choosing to reinvest a part of that into two areas where we see significant long-term opportunity, hotels and AI. That investment is visible in our current cost base. It is also intentional. Let me begin with buses, which continues to be the strongest part of our portfolio. Our bus business is now our largest vertical by contribution margin and continues to grow substantially faster than the broader market. Some of the category tailwinds are structural, continued highway development, growth in bus capacity, and travelers increasingly using buses when confirmed train inventory is unavailable. Higher airfares also made ground transport relatively more attractive. The more important story is that AbhiBus is outperforming the category. Our year-on-year GTV growth came in at 39%, much higher than that of the market, and it even exceeded 60% in 17 of the states we operate in, including large markets such as Delhi, Odisha, Uttarakhand, West Bengal, and Himachal Pradesh, as well as in several states in the Northeast. This is not growth concentrated in one region or driven by one campaign. It reflects deeper supply, stronger local execution, and better products. We recently expanded our government bus inventory through an integration with West Bengal State Transport Network. We are also solving some of the most basic anxieties associated with bus travel through product innovation. Our roadside assistance program, for instance, provides eligible travelers with a replacement taxi to their destination in the event of a bus breakdown or accident. It is now available across 20 states and covers approximately 95% of our bookings, with an easy taxi typically showing up within 45 to 60 minutes of a breakdown, even in the middle of a highway. These interventions may sound operational, but they have strategic value. When we reduce uncertainty for the traveler, we improve trust. When we improve trust, we improve conversion, repeat behavior, and word of mouth. When better products are combined with broader supply, the marketplace compounds most efficiently. We are also expanding beyond consumer apps. BusBase from AbhiBus enables offline and smaller travel agents to access and sell bus inventory and ancillary services through a single platform. It is already contributing its share of transactions while allowing us to address demand that was previously difficult to reach digitally. Although buses is already our largest business by contribution margin and the fastest-growing one, we believe there is still plenty of road ahead, no pun intended. Let me now turn to flights. The aviation market faced an unusually difficult operating environment during the quarter. The Iran conflict and its second-order impact on oil prices contributed to capacity reductions and sharp fare inflation. Domestic average transaction values or fares on our platform increased 22% year-on-year and 13% sequentially. International average transaction values increased 38% year-on-year and nearly 30% sequentially. Industry passenger growth was negligible domestically and international markets contracted after the conflict. Despite this, our flight segment grew 4% and flight GTV grew 27% YoY. We have continued to be the fastest-growing flight OTA in India and have continued gaining market share. However, the current environment affects an important part of our growth funnel. A significant number of our new-to-flying users come from the next billion user base we serve in trains and buses. When the price gap between a flight and a train or bus journey expands so sharply, these users are more likely to defer or reconsider their upgrade to air travel. That effect is especially visible in Tier 2 and C markets. The encouraging part is that these trends can reverse quickly when the war is over and the fares moderate or capacity returns. However, we don't see this pain easing in the near term, given that JAS quarter capacity cuts by both Air India and IndiGo has led to a year-on-year decline in overall flown passenger segments in the market. Airline commentary also suggests that meaningful capacity restoration may begin only when the festive period starts in the third quarter. Therefore, we remain cautious about aviation passenger growth in the near term while remaining constructive about the medium-term opportunity. We are also evaluating adjacent demand pools. ixigo's flight business has historically been leisure-led, but we meaningfully see usage among merchants, traders, small business owners, unmanaged corporate travelers who use GST numbers on our platform already, and we also see that in our bus and train business. This gives us a credible path into SME and corporate travel through a dedicated business product at some point, which can diversify the demand base over time. We will explore getting into this segment in subsequent quarters. Coming to trains with that, the volume pressure there remains a category issue. Changes to Tatkal access for OTAs last year, lower waitlist inventory, and additional authentication requirements that were imposed in the last few quarters have constrained the broader online train ticketing ecosystem growth. We are not going to predict the timing of policy or platform changes that are outside our control. We are planning the business without assuming any immediate release, but we are very hopeful that OTP-based authentication mechanism will be rolled out to OTAs to ease the drop-off stay experience today, and our discussions on that front have been constructive. What we can control, though, is our performance within the category. Our share of the OTA train market has increased from approximately 60% a few quarters ago to 63% this quarter. We've chosen to preserve the structural profitability of this business too, while continuing to improve the post-book experience, customer service, and adjacent monetization. Food on trains crossed 17 lakh meals during the quarter, touching 20,000+ on many days. Metro bookings are growing month on month, and we are now live in five cities. Today, I also have an announcement to make here. We have gone live with Bharat Darshan rail packages on our train apps, offering affordable, all-inclusive tourist train experiences that encompass the journey, hotel, sightseeing, or Darshan at destinations in partnership with IRCTC and its tour operator partners. We are already seeing encouraging cross-sell from train audiences into buses and hotels as well. For buses, our own channels are in fact the fastest-growing ones, and 90% of our hotel bookings are currently coming from our own captive user base. With that, let me talk about hotels, our next growth engine. Hotels have been our fastest-growing line of business over the last few quarters, and this is an area where our investment intensity is increasing. During the first quarter, we put half a million heads on beds across our hotel network. We now have direct partnerships with more than 10,000 hotels across nearly 700 towns, including thousands of independent properties, and we are signing up several thousand more every quarter. For the first couple of years, we deliberately chose to learn before attempting to scale. The budget hotel category has complex problems around reliability, consistency, and the gap between what a customer sees online and what they experience after arrival, which we refer to what you see is what you get, in the previous quarter's call. We now have much greater conviction about the problems we need to solve, the supply we need to build, and the peace of mind products that can differentiate our offering. The acquisition of a 54.66% stake in Brevistay accelerates this journey. Brevistay adds direct hotel relationships, feet on the street supply capabilities, and expertise in flexible stay inventory. ixigo brings technology, AI-led distribution, a large captive traveler base, and our HELLO partner platform. Together, we believe this can help us build direct supply faster, improve on-ground customer experience, access double-digit gross take rates, and scale more efficiently across both conventional and flexible stays. Hotels will have a longer gestation period than our other categories. We are currently a small player in a large market, but over the next four to five years, our ambition is to become the number one discovery and booking platform for India's mid-market and budget hotels. That ambition will require investment, patience, and disciplined execution. We intend to bring all three. The second major area of investment is AI, and Rajnish will talk more about that in a bit. Some of the AI investments will obviously appear in tech costs before they appear in productivity, growth, or profits. That is the nature of building ahead of any major technology transition. Every company eventually reaches a point where it must decide whether to optimize for this year's margin or for the long-term value of what it is building. We believe the returns available from incremental investment in areas which are strategic for the long term remain important. We will remain disciplined, but it would be premature to optimize ixigo solely for near-term profitability growth when the opportunity to strengthen our competitive position is still so large. Our objective remains straightforward: grow faster than the categories in which we operate, continue gaining market share, invest behind areas where we have conviction, and build a company whose advantages are durable and stronger with scale. With that, I will hand over to my friend and co-CEO, Rajnish, to talk about what we've been building across AI, product, and growth initiatives. Thanks, Aloke. Let me start by mentioning two verticals where we see AI creating significant impact in product acceleration and growth. At Prawaas 5.0, we launched BusTDS.ai, an AI-first operating system and global distribution platform for bus operators. The platform combines AI-based management, dynamic pricing, route planning, automated customer support, and connectivity to multiple distribution channels. It is designed to allow an operator to set up or migrate in as little as 30 minutes. The second is hotels, where HELLO, our AI-first hotel partner extranet, is becoming an increasingly important supply acquisition and engagement engine. We are onboarding 7,000 properties every quarter through the platform and now even support a WhatsApp-based hotel onboarding flow. HELLO supports both conventional stay and flexible stay inventory, and we continue to add tools and AI-led insights for hotel partners to improve their revenue potential on our platform. Our work over the last two years has helped us develop a much sharper hypothesis around what product-market fit in hotel means. We are now testing this PMF across select properties and developing peace-of-mind products specifically for the budget hotel category, which will be rolled out over subsequent quarters this fiscal, and we'll talk more about it then. If we zoom out for a minute, AI is now moving from a capability race to an application and economics race. For ixigo, the key question is no longer whether AI can transform travel. It is how we use AI to transform the customer experience, improve the way the organization operates, and build these capabilities sustainably, at scale, and at the right cost. ixigo NEXT is the consumer-facing expression of this strategy. With ixigo NEXT, we have introduced a new benchmark for what an AI-native travel application should be capable of doing. Traditional travel applications require users to translate their intent into rigid inputs such as destinations, dates, filters, fare classes, and predefined categories. With TARA, customers can express their needs naturally, including needs that may be complex, ambiguous, or difficult to capture through a conventional search form. The experience is not limited to answering questions. TARA can understand intent, compare alternatives, generate interfaces dynamically, navigate users to relevant sections of the application, and progressively move them from discovery towards action. Over the course of this year, we plan to extend this agentic experience across our platforms, powered by our own voice-optimized small language models and a growing suite of AI agents designed for multiple travel use cases, complex workflows, and diverse tool calling capabilities. The significance of ixigo NEXT goes beyond a new interface. It is beginning to change the quality of information we receive about the customer behavior. Historically, travel platforms understood users largely through clickstream and transactional data. We could see what users searched for, which filters they selected, and what they eventually booked. We could not always understand what they were actually trying to accomplish. TARA is now giving us a much richer view of customer intent at the top of the funnel. Customers can tell us in their own words the type of experience they want, the constraints they face, the people they are traveling with, and the trade-offs that matter to them. As TARA begins to handle a wider range of travel needs, we are learning not only what customers ultimately book, but why they make certain choices, what information they need before deciding, and where existing travel journeys continue to create friction. These conversations are becoming a new source of product intelligence and a very valuable one. They allow us to identify unmet needs, discover new use cases, and understand customer behavior at a level that conventional search and booking data cannot fully capture. We expect these insights to directly shape the next generation of features, workflows, and customer experiences that we build across the ixigo group. Over time, this can create compounding advantage. The more customers interact with TARA, the better we understand their intent. The better we understand their intent, the more relevant and personalized the experience can become. As the experience improves, customers have more reasons to use the platform for a broader range of travel needs. This is the shift we are trying to drive through ixigo NEXT, from customers searching through a travel applications to having an intelligent travel companion understand, guide, and eventually act on their behalf. Building this capability requires investment today. That investment is currently visible through higher expenditure on engineering talent, AI infrastructure, model development, token usage, and orchestration. Some of these costs are front-loaded. The initial development of the platform, the creation of evaluation systems, and the training of our own small language models can be more resource-intensive than their subsequent refinement and deployment. Other costs, particularly inference, token, and orchestration costs, will recur and may grow as usage expands. We do not evaluate AI expenditures simply as an additional technology cost. We evaluate it against the economic output it generates. A higher token bill is not necessarily negative if it allows us to ship significantly more without increasing headcount proportionately, automate operational workflows that resolve more customer interactions at a lower unit cost, or accelerate product experimentation or improve conversion, engagement, and retention. The relevant measures are therefore not only absolute AI expenditure. They include output per employee, cost per task completed, cost per customer interaction, speed of product development, incremental revenue generated, and technology costs related to revenue. This is why we never report numbers like percentage of code written by AI, because they are almost irrelevant today. The cost impact also naturally appears before the full productivity and revenue benefits become visible. We are investing today in platform development, models, infrastructure, evaluation systems, and organizational adoption. The benefits compound as more engineers, teams work through the customer journey and begin using the same underlying capabilities. AI is different from a conventional software investment because the same underlying intelligence layer can create leverage across multiple functions. It can improve developer productivity, automate larger parts of operations, accelerate product launches, reduce dependence on certain third-party software tools, and create entirely new customer experiences. We therefore expect the rate of increase in technology expenditure to moderate as some of the initial platform and model development investments reduce, while the productivity and revenue benefits continue to scale. From a longer-term perspective, our objective remains for technology costs as a percentage of revenue to become more efficient year-on-year, although individual quarters may continue to reflect investments in new capabilities. The economics of the underlying AI stack are also evolving rapidly. Over the last few years, most of the industry's attention has been focused on the exponential improvement in foundation model intelligence. On several mature benchmarks, including software engineering benchmark, also known as the SWE-bench, leading models are beginning to cluster within a narrower performance range. This does not mean model progress has stopped. It means that incremental difference between the best available model and another capable model may be becoming less consequential than it was during the earlier phase of rapid improvement. When intelligence was improving exponentially, being six months behind the frontier could create a significant capability gap. As performance begins to converge, a lower cost or open source model does not always need to be the absolute best. It only needs to be sufficiently capable for the specific task. At the same time, differences in cost can remain enormous. As an illustration, an agentic workload consuming approximately 10 million input tokens and 1 million output tokens can cost under $2 on one model and around $150 on another, depending on the model and caching assumptions. That is close to a 90 times difference in cost, even though the difference in usable intelligence for a particular application may be considerably smaller, in this case, less than 25. This changes the economic question. The objective is no longer to use the most powerful or the most expensive model for every problem. It is to use the right model for the right task based on the required intelligence, accuracy, reliability, latency, and cost. This is why we are increasingly investing in our own AI harnesses. By harness, we mean everything that surrounds the underlying model: proprietary context, long-term memory, access to tools and data, workflow orchestration, domain-specific guardrails, evaluation systems, feedback loops, and intelligent routing between different models. The foundation model provides raw intelligence. The harness converts that intelligence into reliable, specialized product or workflow at the appropriate cost. Simpler and repetitive tasks can be routed to smaller open source or domain-specific models. More expensive turnkey models can be reserved for problems that require deeper reasoning. Our own small language models can improve the performance, latency, and economics of specific travel and organization use cases. The system can continuously evaluate outputs and optimize for quality, speed, reliability, and cost. For a vertical platform like ixigo, we believe that this is where a significant part of the long-term differentiation will reside. The underlying foundation models may become widely available, but they do not possess our proprietary travel context, transaction history, user preference, operational workflows, or the deep understanding of Indian travelers. When this context is combined with the appropriate model orchestration layer, general purpose intelligence can become a highly specialized travel intelligence system. We are applying this architecture not only to ixigo NEXT, but also across customer service, engineering, analytics, internal knowledge systems, and workflow automation. Our objective is not to deploy one universal model everywhere. It is to build specialized systems that combine the right intelligence context and tools for each problem. This transition is also changing what exceptional talent looks like. Give two people access to the same AI tools, the same models, and effectively unlimited tokens, they can still produce dramatically different outcomes. One may build something functional, the other may build something exceptional. When execution becomes increasingly accessible, outcomes are differentiated by distinctly human qualities. We believe several of these qualities will become especially important. Judgment, taste, empathy, agency, resilience, curiosity, and vision. AI can generate options, judgment determines which direction to take, which trade-offs to accept, and which output to reject. AI can produce endless variations, taste determines what is coherent, differentiated, and worth shipping. Empathy enables people to understand the underlying customer problem rather than merely completing a stated task. Agency determines whether someone takes ownership, uses every available resource, and drives the problem to an outcome without waiting for detailed instructions. Resilience matters because working with AI is rarely linear on a straight line. Models misunderstand, approaches fail, teams often need to reframe a problem several times before finding the right solution. Curiosity determines how deeply someone explores the available possibility space. Ambition determines whether someone merely completes the brief or uses AI to imagine something substantially better than what existed before. This is increasingly how we think about talent and hiring at ixigo. We're not merely looking for people who can use AI to execute faster. We are looking for people who can make better decisions, understand travelers more deeply, challenge existing benchmarks, and use AI to expand the boundaries of what the company can build. AI is not making talent less important. It is making the distinction between ordinary and exceptional talent much clearer. Our thesis is quite simple. As foundational model intelligence becomes more accessible, sustainable differentiation will increasingly move towards proprietary context, domain-specific models, efficient orchestration, superior product experiences, and the quality of human judgment behind them. We believe these are precisely the layers where ixigo can build a durable competitive advantage. ixigo NEXT is the most visible expression of this strategy today, but the opportunity extends across our entire organization. As these investments mature, we expect them to translate into deeper customer understanding, more personalized and agentic travel experiences, higher productivity, lower unit costs, faster innovation, and new sources of long-term growth. With this, I'll hand over to Saurabh. Thanks, Rajnish. Hi, everyone. Unfortunately, the flu has caught up with me this week, so if my voice sounds a little off, it's just me, not a reflection of how I perceive the quarter. Let us walk through Q1 FY 2027. All figures are in INR crore, unless specified otherwise, and year-over-year comparison are Q1 FY 2027 against Q1 FY 2026. Starting with the headline numbers. Gross Transaction Value, or GTV, reached INR 5,524.33 crores, a 19% increase over INR 4,644.66 crore in Q1 last year. Revenue from operations stood at INR 356.75 crore, up 13%. Contribution margin grew to INR 144.94 crore, up 13%, with contribution margin percentage at 40.6% against 40.5% last year. Adjusted EBITDA, excluding other income and ESOP cost, was INR 29.24 crore compared to INR 31.34 crore, a decline of 7%. Profit after tax came in at INR 34.24 crores. Turning over to business lines, I would like to highlight that despite the challenging external environment affecting some of our business lines, we have continued to gain market share across all. For trains, we booked 2.44 crore train segment, down 8%. GTV was INR 2,138.6 crores, up 4%. Revenue stood at INR 141.04 crore, up 9%. Contribution margin rose to INR 52.74 crores, up 29%, with a contribution margin percentage improving from 32% to 37%. Trains contributed 36% of the group's contribution margin. In flights, we booked 0.29 crore flight segments, up 4%, with a GTV of INR 2,341.84 crores, up 27%. Revenue was INR 104.56 crore. Contribution margin was INR 41.04 crore at a contribution margin percentage of 39% against 42% last year. Flights contributed 28% of group contribution margin. On buses, passenger segment grew 33% to INR 0.89 crore. GTV grew 39% to INR 947.43 crore. Revenue was up 34% to INR 102.55 crore. Contribution margin grew 28% to INR 54.22 crore at a margin of 53%. Buses are now the largest contributor of contribution margin, accounting for 37% of the group. Even though I don't usually mention the other segment, it's worth highlighting this quarter as the hotel build-out sits alongside businesses such as Zoop. Others had a contribution margin of - INR 3.06 crore against a positive INR 1.86 crore last year. That is a meaningful part of where this year's investment in hotel is showing up above the contribution margin, and this is a choice that we are making with our eyes open. In terms of operating metrics, monthly active users were 8.5 crore. Monthly transacting users were 0.42 crore, with our MTU to MAU ratio up to nearly 5%. App downloads for the quarter were 3.27 crore. 92% of our customer queries were solved by AI chatbot this quarter, up from 88%. Lastly, there isn't much to call out in terms of one-offs this quarter, but since I cover this every quarter, I will continue to do so this time too. The one-offs and call-outs for Q1 FY 2027 include share of loss from Fresh Bus and Squad, which are associates, of INR 3.98 crore. For Q1 FY 2026, the one-offs and call-out comprised of share of loss of Fresh Bus, which is associate, of INR 2.33 crore. In closing, I leave you with a quote often attributed to Henry Ford. My wife reminded to me about this on a particularly difficult day. "Whether you think you can or you can't, you're right." At ixigo, we think we can. It takes conviction and a little chutzpah. I'll now hand it over to the moderator for Q&A. Should we do the customary DAM question first with Anmol? Thank you so much, sir. Ladies and gentlemen, we will now begin with the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. First question comes from the line of Mr. Anmol Garg from DAM Capital. Please go ahead. Hi. A couple of things that I wanted to ask. One is that, there is 80% sort of sequential jump in our advertisement spend, which has taken our overall margins lower. Just wanted to understand, is this one time spend or is this an ongoing trend, and how should we look at the ad spend going ahead? Will it go back to that INR 18 crore-INR 19 crore kind of quarterly levels, or is it like that INR 32 crore-INR 33 crore kind of level is something which will be going on? In addition to that, if you can sort of also answer that, how should we look at the overall margins of the company going ahead? That will be my first question. Hi, this is Aloke here. If you look at the brand marketing spend that we typically do, it is very seasonal, right? Like if you look at the Q2, one, typically it's a little heavier on marketing spends. This year we had IPL where we had ConfirmTkt doing some activities. We had AbhiBus also, Up India and Teja little bit on the marketing side there. It's also typically the peak season of the year where marketing spends are typically higher, right? Is this going to be the new level? No, because there could be quarters where we take it to these levels. There could be quarters where we choose not to play because they may not be either the right season or the strategy is to not utilize spends in that particular quarter, right? By way of guidance, we don't typically give guidance on the brand marketing spend. What I can tell you is that if you look at the overall customer inducement cost that we have, right, which is brand performance and discounts put together, we try to stay in the 4% of the GTV range, right, whenever we can. There could be quarters where we go above this, and there could be quarters where we stick to this range. Right, Aloke. In addition to that, how should we think about margins going ahead? Just wanted to understand that since our contribution margin is somewhere kind of maintained. Yeah. Will there be a flow-through because of operating leverage in terms of the margin improvement in the coming quarters? Yeah, great question. If you think about what's happening, right? Rajnish talked about a lot of investments we are making on the AI side in terms of model training, in terms of our own small language models, harnesses, et cetera, being built. You will see that some of the tech expenditure going up reflects that. Some of that is obviously front-loaded, right? If you look at hotels, which I called out as our next growth engine, we have spent compared to the same quarter last year. If you look at the other line of business includes hotels for us. If you see the contribution margin that that line contributes versus last year, right, there is almost INR 5 crore delta on that, right? Which Saurabh also talked about in his portion of the call. You can think of it this way, right? We are using the operating leverage that our core business is generating to invest in AI and hotels growth, right? That's the way to read this quarter. Some of those investments could be more like front-loaded tech and AI investments. Some of them could be investments that we will probably continue because hotels is something we are still building out, right? That's where the EBITDA margin answer comes to. Just to add on, to what Aloke is saying on your first question, which is, remember that if you see last year too, it was a similar-ish pattern, so on advertising and branding. Just have that as the base. It is something which we do strategically. The other part of it is as the higher take rate businesses become more dominant as a part of our portfolio, you'll see some shift there. That naturally flows advantageously to the EBITDA level. Sure. Thanks, Aloke and Saurabh. Just one more question. In the flight segment, while the volume growth is understandable given that market has also been a little weak. However, our GTV growth was quite strong at 27%. Just wanted to understand, has the pricing for us moved like 20% growth in our tickets? Because if we look at the other player in the segment, there it was the pricing growth was merely about 10 odd%. What's driving almost like a 20% kind of growth in pricing for the tickets on our platform? In addition to that, you also indicated that there's some capacity reduction which has happened by IndiGo and Air India. From that context, should we expect that sequentially there could be a slight decline in going ahead in 2Q within the flight segment? Yeah. First of all, on the fares, in the narrative, I had called out that domestic average transaction values that we are seeing now, average transaction value is a function of two things, which is the segment fare as well as the number of passengers who travel. Average transaction value that we have seen increased 22% year-on-year on domestic and on international, we have seen an increase of 38% year-on-year. The increase of for us versus someone else could be a function of mix of what kind of segment mix they have on international versus domestic as well. Secondly, it could also relate to whether there is more long haul or more short haul on the international side. There could be reasons why this could vary across OTAs. Just to set the context right, see what has happened in the broader market is that if you look at DGCA data, there was a 2% sort of a growth year-on-year in passenger segments. Right now on that kind of overall market growth, typically think of it as following. If you're a NBU user and you have to pay x thousand rupees extra to buy a flight ticket, and suddenly, now that price delta is almost double of that it becomes very difficult for them to pay up and move up the ladder during this environment. Right? We saw this in the past also, that whenever such crazy fare hikes happened, the NBU funnel gets affected. As and when this subsides, the NBU funnel is also the first to come back very quickly, as we saw during COVID and other such moments where the fares start going down and you start seeing the upsides start to come in. We remain hopeful that this Iran crisis at some point will get fully solved and of course it's an on and off situation as we have seen. Assuming that it does and the oil prices also correct, some of the fares might normalize again. The bigger issue right now, at least in the JAS quarter, is that both Air India and IndiGo have taken a conservative stance in terms of supply. They have cut back on routes and obviously the overall capacity and you can track the DGCA numbers for July yourself, but you will see that the overall capacity has shrunk out there. If the capacity is shrinking at that pace, it could be even depending on how August, September plays out. I'll not make any forward-looking guesses around it but depending on how much that shrinkage happens, it will impact all the players, not just us. The good thing is that we've managed to continue growing even in that environment, at least in the June quarter. I think in the quarter to come, again, it will depend on whether supply comes back. Right now, I can tell you that Air India, we have seen close to 20% cut. IndiGo, we've seen a 10-ish percent cut. On the supply side, if that continues, it's going to be a very tough situation for everyone who's in the air OTA business. No, Aloke. Thank you so much for answering my questions. I will join back in the queue. Thank you. Thank you. The next question come from the line of Ankur Mahendru from BofA Securities. Please go ahead. Hi, good evening, management. Thanks for the opportunity. I have two questions. Firstly, thanks for the disclosure on hotels. Can you talk a bit more about these half a million numbers? What share of your hotel customers is coming from your existing funnel versus a standalone customer acquisition? And a related line on that is the investments that are being done out here on the contribution margin or below contribution line, how much of the investment is being absorbed across hotels and AI, if you could separate that number out there, please. Hi, [Ankur]. I called out this number, but I'll repeat that. If you see the hotels business, we are hitting a point where we have critical mass of supply. We have a critical mass of passengers who are opting for this in our funnel. Though I called it out, I will tell you again that 90% of the bookings we have seen are coming from users who are already registered on our platforms. Which means they were already our users and not people who came and registered for the explicit purpose of buying a hotel. That's a very important metric because it means our dependency at this point on third-party funnels to aid this growth is quite low. Not saying that we will not go and look at those avenues for growth later on, at least at this point, we've managed to reach this half a million add-on base numbers largely from our own funnel. Right? The repeats are also coming out nicely because now, remember, we have close to two years of data and even in terms of scaled-up data, we have three, four quarters of sort of growth where we have seen people come back and buy the second time, the third time through our platform. We understand what the behavior looks like and therefore we are gaining more confidence on how this market share evolution will go from here. We will not be shy, obviously, of investing in aiding this growth, at least for new bookers to experience hotels on our platform. If we need to incentivize those new bookers we are doing that already. Also from a product experience point, I'll let Rajnish talk about that in a bit on what the plans are there. We'll not be shy of investing in this category because clearly we see that for the user base we have Which is more attuned to both mid-market and budget hotels, let's say three star and below. We are destined to be the largest player in this space over the next four to five years. Let's put it that way. We'll not leave any stone unturned to get there. Over to Rajnish. Like we said, people ask this question about disclosures on what numbers we were doing, we were trying to avoid that because we were really not confident about the product market fit like I talked about earlier. Which we are fairly confident now, like Aloke said, this is the time where whenever we find that product market fit and we have a conviction, we don't shy away from investing. That's definitely going to happen now going forward. We also have this understanding of exactly what those pain areas are. One of the key things was identifying exactly what kinds of peace-of-mind products that can actually work well within hotel travel category. This is something that really worked well for us on flight versus train. I think the same thing was very hard to crack on the budget category of hotel stays. Now, we have cracked it. You should expect that these kind of products and features will start coming out really, really soon in the coming quarters. We've already created an experience now with ixigo NEXT within hotels, which is basically so unique that I haven't really seen products of this nature, even globally. We are quite confident that we should be able to scale this product, simply because I think the product is sticky enough for people to come back to it and the word of mouth to kick in as well. Just to add on that front thread so that you don't panic in that sense, that look, it's ixigo. We have behaved like ixigo throughout. Whatever we do, as in I could have taken a call going aggressive two years ago. Whatever we do is based on what we get as a feedback on the product working or the conviction that we build on. In that sense, everything is weighed on the conviction. We feel very strong conviction in areas, and we are getting deeper into that. It doesn't mean that if the world changes, we continue going aggressive for the sake of being aggressive. We have guardrails, and we plan to grow within that guardrails. Thanks, Saurabh. That exactly was my second question out there. Could you give a broad idea on what the guardrails or benchmark on operating leverage that you have, which you are willing to reinvest now? One way to think about it is, currently the EBITDA decline, let's say, on a sequential or a YoY basis is about 120 odd bits on your revenues. Is that broadly the sense? That is something that you can probably invest on one quarter, but for a full year or let's say for next two years, if somebody were to think of it that way, what is that number that either on absolute terms or margin terms that you could broadly guide the street out there? I'm clarifying my last question. I'll explain it in a very different way, which might not answer your question or might. If I start giving you. Let me put it this way, and I said the same in probably two quarters ago or a year ago, or probably more. I don't remember which quarter, but what I have said there is, in case what Rajnish said, in case, doesn't seem to be happening. The product which we build is great. We put it out, it is not working that much. You get a much higher margin in that sense. If what we are doing works, we will put capital behind that. What it is is very different, I need to open up my next five years plan to you if I want to give you any other detail, probably when I do it to you, I do it to the market. Can't do that, what I'm just saying is, look, it works both ways. If you see a higher margin, it means that some of our plan and the feedback that we are getting, we are not getting that strong a feedback. I'll pass it on to Aloke to add on to that. Yeah. I just want to add one thing here, that if you look at ixigo's entire history over the last 20 years, we have never bought market share to win. We've basically gone and built the best product experience, built the best customer experience, and we've only fueled that with marketing spends or customer acquisition spends. Once we hit the right product market fit metrics and the right retention metrics, that's how we build trains, that's how we build flights, that's how we build buses, and that's how we'll build hotels. That's very assuring, Aloke and Saurabh. If I could just squeeze one more question out here. Yes. From a broader perspective, if you look at the other large listed player out there, they also seem to be going after the market share construct, especially when the market is soft out there. From that perspective, if you say that you are also gaining market share, essentially, who is it coming at the expense of? Are you getting more people from offline to online, or are you squeezing the other broad players in the ecosystem? How should we think about the market construct, let's say, in this particular quarter or maybe towards the end of this year out there? I will stop out there as the last question. Yeah, I'll answer this very differently. Okay. India is a very unique market because if you look at categories like trains and flights, the penetration online of bookings is higher in these categories and obviously, the take rates are lower. The big opportunity lies in categories like buses and hotels, where even though the take rate is high, contribution margins are good, the penetration is still low. If you think about mid-market and budget, the penetration is 10% or probably sub that. Even if you go to below two star, it will probably be sub 10% in many small towns. When you are in a category where penetration is that low, even if you are the number N player, the category does not exist yet for you, and you have to create the category. The advantage we have versus any other player who has tried to do this in the last 20 years, the only difference we have is we have more users at this point of time than any other player in the OTA space. We are starting off with a huge advantage on day one, and that is why we called out the 90% coming from existing funnel number that we are not going to ride this by buying users from 10 other places. We are going to make sure the users who come on our platform end up buying hotels from us. That's a problem that we have a better handle of as we speak today than we did two years ago when we were starting to build out hotels. Thank you. That's it from our side. Best of luck for the quarters to come. Thanks. Thank you. Our next question comes from the line of Swapnil with JM Financial. Please go ahead. Hi, everyone. Thanks for the opportunity. The first question is again on the spend side. Your employee costs seem to have gone up meaningfully this quarter, whereas the technology and related costs seems to have remained flattish or slightly negative on a Q1 to Q basis. My question out here is, if you are investing on hotels and AI, which are the line items that we should I'm presuming these are the two items that we should be looking at. Is there any reason for that volatility over there? The second related question is, last time we reported the results, we talked about some capitalization of certain cost. Could you call out what that number would be for this quarter? Swapnil, I'll take a look on the cost for hotels you'll have to look through as until I break it out completely below contribution margin, you'll need to look at both our technology as well as impact. Again, it comes in both when I have built a 10,000 hotel direct connect, there is an employee cost also, there is a team I have, and there is a team centrally running the hotel business too. The first one was that. The second one was, it's more or less in the same range as we talked about last time. As I've said before when we talked, it's broadly portion and the same answer at that point of time. Once the platform is done, that is when it sits around the same range. On the capitalization part, sir? I said that's what I answered now. Okay. It's in the same range. Okay. Okay. The second question is with respect to your trains business. There has been a decent increment in your take rate as well as contribution margin. Is this related to the consolidation of trains or the Spanish business, or it is organic business which is doing well over here in terms of take rates as well as margin? Look, part of it's Trenes. Trenes is a small part of the overall business. The larger part is the contribution margin, and don't take that as a standard contribution margin when predicting forward. As Aloke talked about, there are issues in train macro or how there are problems due to which growth is suffered. If you see, we have actually gained a percentage point in our market share this quarter. What we've also done is spending a lot during this time when the external environment hasn't stabilized. Doesn't make sense. We've cut costs there, and we're just balancing that out. In the long run, don't project it. In the long run, once the external environment improves, we see this growing. I think on the Trenes part, it's still a very early stage. We are in the process of getting in the business. Probably the question of the Trenes impact on us comes in a year's time once we have built our peace of mind, staff there, once work done there, once we've identified the other geographies around it where we expanded. Think about it in a year's time, which is much more relevant. Okay. Just a last one on your air- ticketing business also. See, I understand there are some macro challenges over there, especially from the supply side. The question out here is that you are also going to get some benefit of base, right? Till now, your base was also very tough, and you delivered a decent growth on that base. With the base being supportive going ahead, should not you be able to maintain the current growth run rate, if not a meaningful acceleration from where we are today? Swapnil, my only answer would be I have no idea what happens to the macro. If I had, yes, in an ideal situation, what you're saying is correct. Macro being like what it is, and remember, because my growth will be a derivative of where the ATV and where the supply is. Again, I would have loved to give you a much more clearer answer on this. Right now from what we are seeing at the macro level, it doesn't look like it. If things improve and, say, the geopolitical situation improves, finishes or clears tomorrow, then obviously what you're saying would happen. Right now, commenting on things which are not in my control won't be right. Got it. Sorry. Just a last, I'll squeeze in one. The average ticket size for your hotels business would be somewhere around INR 1,700-INR 1,800. Is that a fair assessment given that you talked about 0.5 million bookings and the higher GTV and the other side? Yeah, Swapnil, Aloke here. It's higher than that. At some point in the future, we'll start calling out more details. Reassuringly, it's higher than that. Got it. Thank you. Thank you very much. Swapnil, if you're trying to calculate from others, remember others are [inaudible] and a couple of other businesses also. We start back out, you'll get a clearer view. Sure. Thanks. Thank you. Our next question comes from the line of Karan Uppal with PhillipCapital India. Please go ahead. Yeah, thanks for the opportunity. First question is on the bus segment. The net take rate was down on a sequential basis. Has the discounting decreased in this quarter? Also, how should we think about this going ahead? Hi, Karan. Aloke here. See, I think the way to look at it is as follows. It is largely a duopoly kind of a category in the OTA business at this point, right? If you compare us versus competition in terms of how discounts or marketing spends are moving, you will see that we have been a lot more disciplined at least this quarter about it. If you look at the net take rate that we have versus any other player in the category, it would be fairly similar or in the same ballpark, right? Remember, there is a peak season where you obviously are a little more aggressive on marketing discounts, et cetera. Then there are seasons where you are not. Classically, AMJ or OND quarters, you will see more activity around, right? That is what happened here. Aloke, going ahead, should we assume this number to extract to, let's say, 11.5 kind of number from 10.8? No. 11.5 is a gross take rate, and then there's discounts which lead to the net take rate. But if you look at the discounting levels we've operated at in the last six to eight quarters, we've been range-bound on that, right? We've never really gone crazy on this, nor do we have any intention to in the short term. Karan, the other part of the discounting level, think of it in a very different way. What happens is when the fuel price increases, at a point of time because of a higher ATV, as an OTA, I am getting a lot more and I can share part more to the customer. If you look at my segment result per segment, which is the profit at the contribution margin level I'm getting per segment, that is closer. Actually, that's increased quarter-over-quarter. It is kind of the nature of this business which is there. All right. Second question was in terms of the other income is increasing sequentially after last two quarters. Right now it is at around [inaudible]. Going ahead, shall we assume this number to be stable or it will increase further? Largely there over the years, part of it was we've been through some but think of it largely around that. I mean, it's not something that should increase substantially. Got it. Last question is to Rajnish in terms of TARA. Anything you can share in terms of the conversion of users, let's say, people who are converting on the platform versus the converted users. Any trends around there? We talked about it briefly. We haven't disclosed any numbers about what exactly those conversion numbers are. All I can tell you is that whenever we have released a new product or a new version of an application or a new feature, we extensively test it for all the metrics that we care about, whether it is the NPS or the conversion rate, et cetera. Unless we don't see superior performance in all of those metrics, we don't release those products. The fact that these products are live, that itself is a proof that it's basically performing better than what was prior to this. Got it. Thank you. Okay. Thank you. Ladies and gentlemen, due to the interest of the time, that was the last question for today. I now hand the conference over to the management for the closing comments. Thank you and over to you, team. Thank you. With that, we come to an end. Thank you so much for joining our quarterly earning call and see you on the other side in Q2. Thank you so much, sir. Thank you. Great. Thank you. Ladies and gentlemen, on behalf of DAM Capital, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.