Synopsis : India’s online travel industry is entering a new growth phase, driven by rising digital adoption, increasing travel demand and higher online booking penetration. Motilal Oswal has reiterated its Buy rating on TBO Tek and initiated coverage on Ixigo and Yatra Online, seeing upside potential of up to 30%.
India's online travel ecosystem is witnessing a structural shift as consumers increasingly prefer digital platforms for booking flights, hotels, train tickets and holiday packages.
According to Motilal Oswal, the sector remains one of the strongest beneficiaries of rising disposable incomes, improving internet penetration and increasing travel demand across both metro cities and smaller towns.
The brokerage believes these trends are likely to accelerate over the coming years and has identified three travel technology companies that could benefit significantly from the industry's long-term growth trajectory.
Motilal Oswal has maintained its Buy rating on TBO Tek while initiating coverage on Le Travenues Technology (Ixigo) and Yatra Online with positive recommendations.
Motilal Oswal's Preferred Travel Tech Picks
| Company | Rating | Target Price | Upside Potential |
|---|---|---|---|
| TBO Tek | Buy | Rs 1,765 | 30% |
| Ixigo | Buy | Rs 217 | 24% |
| Yatra Online | Buy | Rs 125 | 21% |
India's Online Travel Market Continues To Expand
The Indian travel booking industry has undergone a significant transformation over the past two decades.
What was once dominated by traditional travel agents has steadily evolved into a technology-driven ecosystem led by Online Travel Agencies (OTAs).
According to Motilal Oswal, the next phase of growth will be powered by Artificial Intelligence-enabled travel planning, personalised recommendations and enhanced digital experiences.
The brokerage estimates that India's OTA market could grow from approximately Rs 2.08 lakh crore in FY23 to nearly Rs 3.84 lakh crore by FY28.
It also expects online travel penetration to rise meaningfully, with the share of online bookings projected to increase to 65% from around 54% currently.
The report highlighted that India's online travel market remains underpenetrated compared to several developed economies, creating a long runway for growth.
TBO Tek Remains The Brokerage's Top Pick
Among the travel sector names under coverage, TBO Tek continues to be Motilal Oswal's preferred choice.
The brokerage expects the company to benefit from growing travel demand and increasing adoption of its business-to-business travel distribution platform.
Motilal Oswal has reiterated its Buy rating on the stock with a target price of Rs 1,765.
The brokerage forecasts gross transaction value (GTV) growth of approximately 23% annually between FY26 and FY28.
Improving operating leverage and margin expansion are expected to support earnings growth over the same period.
Ixigo Positioned To Benefit From Multi-Segment Growth
Motilal Oswal has initiated coverage on Ixigo with a Buy rating and a target price of Rs 217.
The brokerage highlighted Ixigo's strong positioning across train, flight and bus ticket bookings, making it one of the leading consumer-focused travel platforms in India.
According to the report, the company's key segments are expected to witness healthy growth between FY26 and FY28.
Expected Segment-Wise Growth
| Segment | Expected GTV CAGR (FY26-FY28) |
|---|---|
| Flights | 22% |
| Trains | 17% |
| Buses | 34% |
Motilal Oswal also expects profitability to improve as scale benefits begin to flow through the business and higher-margin services gain traction.
Yatra Online Seen Benefiting From Hotel And Corporate Travel Growth
Yatra Online is the third stock on Motilal Oswal's preferred travel basket.
The brokerage has initiated coverage with a Buy rating and a target price of Rs 125.
According to the report, future growth is likely to be supported by stronger demand for hotel bookings, holiday packages and corporate travel solutions.
Motilal Oswal believes the increasing contribution from these higher-margin segments could improve profitability and support earnings growth over the coming years.
The company is also expected to benefit from growth in meetings, incentives, conferences and exhibitions (MICE), which remains an important segment of corporate travel.
Key Risks Investors Should Monitor
While the brokerage remains constructive on the sector, it highlighted several factors that investors should watch closely.
These include:
- Intensifying competition among online travel agencies
- Dependence on third-party travel suppliers
- Economic slowdowns impacting discretionary spending
- Technology disruptions
- Artificial Intelligence-driven changes in travel planning behaviour
Conclusion
Motilal Oswal believes India's online travel industry remains in the early stages of a multi-year growth cycle supported by rising travel demand, digital adoption and improving online penetration.
Among its preferred picks, TBO Tek remains the brokerage's top choice, while Ixigo and Yatra are expected to benefit from structural growth trends across India's travel ecosystem.
With industry growth expected to outpace several global markets, these travel technology companies remain well-positioned to capitalise on the next phase of India's digital travel revolution.
Disclaimer : The stock recommendations, ratings and target prices mentioned in this article are based on research reports published by Motilal Oswal Financial Services and are intended solely for informational purposes. This article does not constitute investment advice, an offer, solicitation or recommendation to buy or sell any security. Investments in equity markets are subject to market risks, including capital loss and volatility. Readers should conduct their own research and consult a SEBI-registered investment advisor or qualified financial professional before making any investment decisions.
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