Retail investors have been feeling bullish about MakeMyTrip (MMYT). In the past month, the number of stock portfolios with MMYT shares has risen by 32.5%, and analysts are equally upbeat. But What’s behind this? For the fourth quarter of fiscal year 2024, MakeMyTrip’s revenue and earnings-per-share (EPS) topped Wall Street estimates. The company’s revenue grew 36.6% YoY, due to 21.8% more travel bookings. Diluted EPS shot up from the previous year of $0.05 to $1.26. This India-based B2C online travel company provides online booking services for customers’ flights, hotels, trains, buses, and holiday packages. Its revenue is mostly generated through booking commissions, primarily from flights, which it purchases in bulk at lower prices. What’s unique is its dynamic pricing model, which responds to shifting market dynamics. It also offers higher quality products than its rivals.
Success Indicative Of A Sizzling Indian Economy
In addition to its digital business, MakeMyTrip has a network of 30+ franchised retail stores in 28 Indian cities. The company is customer-centered and highly innovative, adapting to travel trends and new technologies. It has expanded its global presence with offices in the U.S., UAE, and Asia. The company has benefited from India’s strong economy. Despite worldwide inflation and supply chain challenges, India has been highly resilient. The country had a growth rate of 7.8% in FY 2023-24, and its GDP is expected to grow by more than 6.5% this year—more than twice the rate of the U.S. economy. The Modi government has invested heavily in infrastructure, such as ports, roads, and railways. Modi’s success in the recent election suggests that his growth agenda will continue.
How You Can Get In On The Action
Due to the country’s strong economy and forward-thinking agenda, it could be a smart decision to invest in Indian companies right now. MMYT has a Strong Buy consensus rating among six analysts including Morgan Stanley and UBS, with an average 12-month price target of $92. What other Indian companies can you invest in? Reliance Industries Limited has a diverse portfolio in petrochemicals, energy, retail, textiles, telecommunications, and natural resources. Infosys Limited is a leading Indian IT services business. Tata Consultancy Services Limited is a global leader in the IT sector. Two strongly positioned Indian banks are ICICI Bank and HDFC Bank. The easiest way a U.S. investor can gain exposure to Indian companies is through an EFT or index fund. There are many to consider. Some of these include WisdomTree India Earnings Fund (EPI), iShares India 50 ETF (INDY), First Trust India NIFTY 50 Equal Weight ETF (NFTY), Motilal Oswal Nasdaq 100 Fund of Fund Direct Growth (INR), and Bandhan Nifty 50 Index Fund Direct Plan-Growth.
Dilantha DeSilva has no positions in any of the stocks mentioned. Stocks.News has no positions in any of the stocks mentioned.
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Dilantha is a former buy-side equity analyst who now contributes to Seeking Alpha, GuruFocus, TipRanks, and ValueWalk. He is the founder of Beat Billions, a premium investment research subscription service on Seeking Alpha’s Marketplace. He has appeared on CNBC and Bloomberg to discuss stock markets and the global economy.