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Informist, Tuesday, Jun. 16, 2026

 

NEW DELHI – The domestic online travel agencies market is expected to scale up to INR 3.84 trillion in the financial year 2027-28 (Apr-Mar) from INR 2.08 trillion in FY23, growing at a compound annual growth rate of around 13%, according to a recent report released by Motilal Oswal Financial Services Ltd. In contrast, the global online travel agencies market is expected to grow at a CAGR of 6.1% to reach $1.19 trillion by calendar year 2029 from $938 billion in 2025, as per the report. 

 

This growth will be aided by structural tailwinds such as rising disposable income, favourable demographics, a working population, improving air, rail, road, and water infrastructure, and connectivity, changing consumption and spending patterns, easing global travel regulations as well as an underpenetrated online travel ecosystem, the report titled 'Entering the AI Orbit!' said. 

 

The market share of the online travel channel at home is expected to reach 65% in FY28 from 54% at present, according to the report.  

 

"The OTAs (online travel agencies) are now entering an AI-driven (artificial intelligence-driven) phase, evolving into intelligent platforms that offer hyper-personalized, real-time planning, dynamic packaging, and assisted decision-making. Meanwhile, human intervention is shifting toward addressing high-touch and complex travel needs," the report said. 

 

According to the report, the growth of online travel agencies is likely to outpace that of the overall travel market. "OTAs (online travel agencies) are expected to gain market share faster than direct suppliers and IRCTC (Indian Railway Catering and Tourism Corp.) as they aggregate more inventory in one place, enable easier comparison, bundle ancillaries, and offer better and stronger loyalty and retention funnels," Motilal Oswal Financial Services said in the report.  

 

The report, however, pointed out some key risks that may negatively impact online travel in India. It said the growth in the travel-tech industry remains linked to overall economic activity, discretionary spending, and travel demand trends. Any prolonged slowdown in consumer sentiment, corporate travel, or global economic conditions could impact booking volumes and revenue growth, it added. 

 

According to the report, travel demand can be affected by external events such as geopolitical tensions, health-related disruptions, fuel price volatility, or regulatory restrictions, which may temporarily impact customer activity and sector growth. Meanwhile, platform outages, cybersecurity incidents, or delays in adapting to evolving customer preferences could affect competitiveness and brand perception, the report said. 

 

In addition to this, travel-tech platforms rely on partnerships with airlines, hotels, and other travel service providers. "Changes in commission structures, direct booking strategies by suppliers, or evolving regulatory frameworks related to data privacy, taxation, and digital compliance may impact operational efficiency and profitability," the report said. End

 

Reported by Astha Oriel

Edited by Deepshikha Bhardwaj

 

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