Howard Marks' Oaktree Capital Management has disclosed a new position in MakeMyTrip (NASDAQ:MMYT), purchasing a stake worth approximately $52.4 million in the Indian online travel aggregator giant. The move comes as shares of the New Delhi-based company trade down roughly 25% year-to-date, weighed by geopolitical turbulence affecting international air travel and mounting competitive pressure from global platforms seeking to expand their footprint in one of the world's fastest-growing travel markets.

Market Context

MakeMyTrip operates India's largest online travel booking platform, facilitating flight reservations, hotel bookings, holiday packages, and bus and cab ticket sales across the country's vast domestic market. The company commands a dominant position in Indian online travel, competing against both global giants like Booking.com and Airbnb, as well as homegrown rivals in a fragmented but rapidly digitizing sector.

The broader Indian travel market has been experiencing structural tailwinds as rising incomes lift millions of middle-class consumers into the tourism ecosystem for the first time. Smaller cities are increasingly coming online, creating fresh demand pools that established players like MakeMyTrip are positioned to capture. However, the near-term picture remains complicated by factors ranging from Middle East tensions that have disrupted international flight routes to pricing pressure from hotel chains encouraging direct bookings.

Analysis

Marks' entry into MakeMyTrip reflects his contrarian reputation—famously warning about risk in Oaktree's memos during market peaks while positioning for opportunity when sentiment turns pessimistic. The $52.4 million position represents a meaningful vote of confidence in the company's long-term thesis despite near-term headwinds.

The bull case centers on MakeMyTrip's diversified revenue mix and its ability to capture travel demand regardless of how it manifests. When airfares spike due to geopolitical disruptions, customers migrate toward buses, cabs, and short domestic hotel stays—segments where MakeMyTrip holds strong positions. The company's bus ticketing margin expanded 32% in the most recent quarter, while hotels and packages profit grew 21%, partially offsetting weakness in the air segment where international departures fell 13%.

Technology leverage presents another angle. Management highlighted that artificial intelligence now generates approximately 75% of its code and handles roughly half of customer service interactions without human involvement. This automation holds down staff and outsourcing costs even as the business scales, potentially expanding margins over time if execution holds.

On the bearish side, air travel remains a substantial component of MakeMyTrip's business, and renewed escalation in Middle East tensions could sustain elevated fares and soft demand for international routes. Competition poses a structural risk as Booking.com and Airbnb intensify their India strategies, while major hotel chains like Marriott increasingly direct customers to book directly, circumventing intermediaries and compressing commission-based revenue.

The company has responded by increasing spending on discounts and rebates to retain customers, a strategy that protects market share but erodes profitability in the near term. Investors will need to monitor whether this defensive posture becomes permanent or represents a temporary response to competitive pressure.

Key Numbers

- $52.4 million: Value of Oaktree Capital's disclosed stake in MakeMyTrip

- 25%: Year-to-date decline in MMYT shares

- 20%: Quarter-over-quarter growth in gross bookings (constant currency)

- 16%: Revenue growth in the most recent quarter (constant currency)

- 13%: Decline in international flight departures due to Middle East disruptions

- 21%: Growth in hotels and packages profit

- 32%: Bus ticketing margin expansion year-over-year

- 75%: Share of company code reportedly written by AI systems

- 50%: Customer service calls handled without human involvement via automation

What to Watch

Investors should monitor MakeMyTrip's next earnings report for signs of stabilization in the air segment and whether domestic travel demand continues compensating for international weakness. Key metrics include gross booking value growth, take rates across segments, and evidence that AI-driven cost savings are flowing through to operating margins.

The competitive landscape warrants close attention—any meaningful share gains by Booking.com or Airbnb in India would signal structural pressure beyond cyclical factors. Similarly, hotel chain direct-booking initiatives could chip away at MakeMyTrip's commission revenue if they gain traction with consumers.

On the macro side, movements in crude oil prices and any de-escalation in Middle East tensions could provide tailwinds for airfares and international travel demand. The company has demonstrated resilience by capturing demand shifts to alternative transportation modes, but sustained air segment weakness would ultimately limit the upside as that segment typically carries higher margins than ground transport.

Marks' position size—while meaningful—represents a relatively small allocation within Oaktree's broader portfolio, suggesting it reflects a calculated tactical bet rather than a transformational conviction. Further disclosures in coming quarters will reveal whether Marks is building or trimming the position based on evolving fundamentals.