Pros and Cons of Investing in Ixigo

The share price of Ixigo - Le Travenues Technology Ltd - has been in the news over the last few months due to impressive gains.

In a range bound market where uncertainty is the dominant sentiment among investors, a stock moving up sharply is bound to catch attention.

At the start of this month (October 2025), the stock resumed its upward journey after a brief pause.

There has also been a considerable jump in trading volumes in the stock. So much so that the exchanges asked for a clarification from the company.

The management replied that they were not aware of the reason for the spike in trading volumes and have made all the necessary disclosures under the regulations.

The stock tested the patience of early investors after the company's IPO back in June 2024. The stock was mostly flat for about a year.

Most of the gains in the price have been recent, since July 2025, after the company announced its first quarter results for FY26.

Ixigo Share Price - Since Listing

After such sharp gains, potential, investors would be interested in the future of the company.

In this editorial, we will consider the pros and cons of investing in the stock of Ixigo (Le Travenues Technology).

Read on...

Pros

#1 Good Fundamentals

Founded in 2006, Ixigo is one of the leading Indian online travel agencies (OTA) with high average monthly users and downloads on its popular ixigo app.

The company ranks as India's largest OTA by user count and the second largest in terms of total reported gross transaction value (GTV). It's the largest train ticket distributor in India and second largest bus-ticketing OTA.

It offers a services such as PNR confirmation and predictions, train seat availability alerts, personalised recommendations, instant fare alerts and automated customer support services.

The company's app allows users to book hotels and holiday packages. It has developed an AI-based platform to help travellers plan their detailed itineraries.

It also launched a value-added service called Ixigo Assured Flex, through which travellers can book their air and rail tickets flexibly.

The company has ventured into insurance recently to expand its service offering.

Since FY19, the company's revenue has grown at a compounded annualised growth rate (CAGR) of 68.2% till FY25.

Earlier the company wasn't profitable but since FY23 it has reported consistent profits. From Rs 234 million (m) in FY23 the net profit grew to Rs 603 m in FY25. But the net profit was down 17.5% from Rs 731 m in FY24.

The company has a healthy balance sheet with zero debt. Its current ratio of 2.2 and debtor days of 15 in FY25, indicate a comfortable liquidity position.

While the return on equity (ROE) was a moderate 10% in FY25, the return on capital employed (ROCE) was a decent 14%.

The company's cash flows are strong. In FY25, the cash flow from operations increased 182.8% YoY to Rs 1,222 m from Rs 432 m in FY24.

#2 Strong Start to FY26

The was the trigger for the recent upmove in the share price.

Ixigo started FY26 on a strong note, with impressive growth across key areas.

The company's revenue from operations jumped 73% to Rs 3.1 billion (bn), and its Gross Transaction Value (GTV) rose 55% to Rs 46.4 bn in Q1 FY26.

Ixigo's flight and bus bookings were up 81% and train bookings were up 30%.

EBITDA increased 69% to Rs 0.3 bn. Adjusted EBITDA, which factors in employee stock option (ESOP) expenses, grew 54% to Rs 0.3 bn compared to Rs 0.2 bn in the same period last year.

Net profit surged 28% compared to last year, reaching Rs 0.2 bn. This growth is driven by the company's strategy of catering to the next billion users in the travel market.

The company saw significant growth in its bus and train segments, particularly among Gen Z travellers. Train booking by Gen Z users 18-30 years old increased 45%, while bus booking in the same age group jumped 56%.

It also saw a big jump in solo women travellers. Train bookings by women rose 123% YoY and solo bus bookings increased 27% YoY.

#3 Good Prospects for the Sector

Travel and tourism is a huge growth industry in India. India's travel sector is expected to grow at a 6.9% CAGR and reach US$ 512 bn by 2028.

This growth is expected to be fuelled by increased domestic tourism, middle-class spending, and greater digital engagement.

Indians are already spending big money on vacations. This discretionary spending on tourism was an alien concept even 10 years ago. Not anymore.

Social media has been a big catalyser. Mobile phones and high-speed internet have made planning trips and navigating destinations easy.

And then there is a mindset change. People are valuing experiences and creating memories as much, if not more than, hoarding and earning wealth and buying things.

Travel firms like OTAs have been big beneficiaries of this megatrend.

Going forward, the management aims to invest in hotels and AI-driven agentic tools. The goal is to outpace the overall OTA market with this strategy.

Additionally, the company seeks to cross-sell various services to its captive user base along with investments in branding to increase user conversion rates.

Ixigo's management is optimistic about sustaining growth momentum, believing that ongoing investments in technology and product enhancements will yield significant long-term returns.

Cons

#1 Fierce Competition

The OTA space is extremely competitive.

The company is up against strong competitors like Easy Trip Planners, Yatra, and IRCTC. Often, there is very little to differentiate between one OTA and another from a customer's point of view.

Profit margins in this sector are hard to maintain. This was evident in FY25 when the company's net margin fell to 6.6% from 11.1% in FY24.

The management is trying many technology-focused strategies to ensure the company's market share as well as wallet share grows over time.

A top priority is younger travellers. The company is attempting to win them over to the app and hold on to them as loyal customers over the long term.

Only time will tell if this strategy is successful.

#2 Valuations

The stock price of the company is currently trading at very high valuations. Investors are paying upfront for anticipated high growth in the long term.

This will be a big concern for investors if the expected growth fails to materialise.

No matter how good the fundamentals of a business may be, investors should always pay close attention to the valuations of the stock.

Stock valuations are measured with the help of the price to earnings (PE) ratio and the price to book (PB) ratio.

At the time of writing, the stock's PE ratio is 160 and the PB ratio is 19.6.

About Ixigo

Catering predominantly to rail, air, bus, and hotel bookings, Ixigo has leveraged technologies such as artificial intelligence, machine learning, and data science to establish itself as a prominent player in the Indian OTA space.

Ixigo focuses on travellers from small cities, creating content and app features that cater to their specific travel needs and challenges.

As travel companies broaden their services and respond to changing consumer preferences, fundamentally solid businesses in this sector may do well in the long term.

For more details, you can have a look at the Ixigo company fact sheet and quarterly results.

Here are some peer group comparisons of Ixigo:

Ixigo vs Yatra Online

Ixigo vs IRCTC

Ixigo vs Easy Trip Planners

To know what's moving the Indian stock markets today, check out the most recent share market updates here.

Investors should evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions.

Happy investing.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...