ixigo Crashes 13% Despite Strong Q1, JM Financial Cuts Target Price

Shares of traveltech company ixigo fell as much as 13.6% to an intraday low of ₹174.15 apiece on the BSE today, a day after it reported its Q1 FY27 earnings, as investors weighed strong profit growth against concerns over margin pressure.

The stock later recovered some losses to trade 12.9% lower at ₹175.70 apiece at 14:10 IST. 

Despite reporting robust earnings, investors remained wary of higher investments in hotels, technology and AI, which are expected to weigh on margins in the near term. 

For Q1 FY27, ixigo reported an 81% YoY jump in consolidated net profit to ₹34.2 Cr from ₹18.9 Cr a year earlier. Operating revenue rose 13% YoY to ₹356.8 Cr, while total income increased to ₹385.9 Cr. 

EBITDA grew 65% YoY to ₹53.5 Cr and contribution margin increased 13% YoY to ₹144.9 Cr. However, total expenses climbed 15% YoY to ₹337.8 Cr as the company stepped up investments across growth initiatives. 

Following the results, JM Financial maintained its ‘Reduce’ rating on ixigo but cut its 12-month target price to ₹200 from ₹220, citing sustained investments in hotels and AI capabilities that are likely to delay margin expansion. 

The brokerage noted that ixigo’s gross transaction value (GTV) grew 18.9% YoY to ₹5,524 Cr in Q1 FY27, driven by the bus business, which grew 39.1% YoY, and the flight segment, which expanded 26.7% YoY. However, adjusted EBITDA margin contracted 177 basis points YoY to 8.2% due to higher employee costs, branding expenses, and investments. 

Reflecting these concerns, JM Financial lowered its FY27-FY29 EBITDA estimates by 11%-15% and EPS estimates by 5%-9%. 

The company continued to invest in expanding its business during the quarter. It acquired a 54.66% stake in traveltech startup Brevistay for ₹65.7 Cr and expanded its hotel supply through direct partnerships with more than 10,000 hotels across nearly 700 towns. 

ixigo is also building its AI-native ixigo NEXT platform using small language models to improve automation, product development and operational efficiency. 

Additionally, ixigo’s board approved the acquisition of an additional 11% stake in train food delivery platform Zoop for ₹36.4 Cr, taking its total stake in the subsidiary to 73%.

“In Q1 FY27, despite the challenging macro environment, we continued taking market share and delivered resilient growth, crossing ₹5,524 Cr quarterly GTV with an all-time high revenue and PAT,” co-CEOs Aloke Bajpai and Rajnish Kumar said on Q1 performance.

Separately, ixigo’s board also approved a €219,200 (about ₹2.4 Cr) investment in its Singapore subsidiary, ixigo Pte Ltd, which will extend an optionally convertible loan of the same amount to Sqaas. The company said the loan has not yet been converted into equity. 

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