Asked during an earnings call Monday whether MakeMyTrip feels the need to establish a contingent liability related to the Competition Commission of India investigation, which is expected to take up to two years, MakeMyTrip founder and CEO Deep Kalra said, “No, we don’t.”
MakeMyTrip co-founder and India CEO Rajesh Magow added, “And we continue to believe, at least from our point of view, that we are completely compliant on every aspect. So no real need for making any provision of any sort actually.”
Acting on a complaint from the Federation of Hotel & Restaurant Associations of India, the country’s competition authority is investigating whether MakeMyTrip’s contractual relationship with Oyo stifles competition.
MakeMyTrip pledged to cooperate with the probe and stated it is confident the company is in compliance with relevant competition law.
Oyo separately noted that it does not engage in predatory pricing practices, as the hotel association alleged, and does not charge hotels exorbitant commissions.
MakeMyTrip’s comments about the lack of a financial contingency in the event of an adverse ruling came as it released its financial results for the 2020 fiscal second quarter, which ended September 30.
For the quarter, MakeMyTrip saw its adjusted operating loss decline to $19.3 million from $25.4 million a year earlier. Revenue grew 13.8 percent to $118 million.
The company said it recorded a record nearly 7.4 million room nights booked in the quarter despite holding back on marketing spend to achieve efficiencies, and seeing weak outbound demand in the traditionally weak second quarter. MakeMyTrip counts 66,500 properties in India, including 16,500 alternative accommodations.
Both standalone hotel room nights and those booked as part of packages grew around 12 percent in the quarter, with the package bookings having a slight edge.
“Our investments in alternative accommodations continued in Q2 as we focused on driving greater awareness of this fast-growing segment,” Magow said. “Encouragingly, we are seeing strong interest from users, and we will continue to invest to drive greater adoption via a differentiated product experience for bookers and hosts.”
Without giving specifics, Magow said during the quarter MakeMyTrip added more hotels and flight options from Ctrip, which now owns a 49 percent stake in the company.
Kalra expressed confidence in long-term growth trends for the company despite the seasonally weak quarter and “near-term growth challenges.”
In other developments, MakeMyTrip officials discussed progress in rolling out installment payment plans, including Trip Money, which comes via a company partnership with non-bank financial firms.
MakeMyTrip officials said the installment plans are approaching 10 percent of total bookings, and are particularly popular with customers taking their first international trips, and families going on domestic holidays.