Dreamfolks Servi

Dreamfolks reported a revenue of ₹1,292 crores for FY25, marking a 14% growth from the previous fiscal year, outpacing the 7.5-8% growth in domestic air passenger traffic and credit card issuance. However, the company faced structural changes, including a large number of banks migrating to a spend-based model for lounge services, which had a short-term impact on growth and margins. Gross margins for FY25 were 11.6%, within the 11-13% guidance, while adjusted EBITDA margin was 7.9%, within the 7-9% guidance. Net profit for FY25 stood at ₹65 crores, with EPS at ₹12.2, a slight decline from ₹12.6 in FY24.

The company is actively diversifying its business model beyond traditional airport lounge services. Non-lounge services currently contribute 7% to revenue, with an aspiration to scale this to one-third of revenues in the next five years. New offerings include coffee at malls (83 outlets), golf games and lessons (40 domestic, 600 globally), railway lounges, and meet & greet services. This strategy aims to reduce dependence on airport lounges, which currently account for 93% of services, significantly over the next 3-5 years.

Dreamfolks successfully onboarded over 30 new enterprise clients in FY25, including MakeMyTrip and Amazon, expanding its B2B and B2B2C presence. Alliances with banking partners like IDFC, Yes Bank, RBL Bank, and Bandhan Bank were solidified. The company also enhanced value for premium customers by providing access to 3,000+ members-only social clubs across 150 destinations worldwide and strengthened its international network with Plaza Premium, adding over 100 new lounges and F&B outlets.

The company's proprietary technology platform is a key differentiator, enabling the spend-based model for over 10 banking clients and providing a seamless, agile, and secure environment. Investments in cloud infrastructure and digital ecosystems support real-time collaboration, scalability, and faster feedback integration. The platform allows for tailored solutions that drive efficiency and measurable returns for clients, enhancing the overall value proposition for travelers and businesses.

Dreamfolks increased its employee base, onboarding 30+ new clients and six new services, which led to higher employee costs in FY25. Management views this as a foundational investment for future growth, particularly in targeting enterprise clients and expanding into new service verticals. The company expects these investments to yield results and contribute significantly to the bottom line over the next 4-5 years, as new clients and services mature.

The company maintains a sound financial health with net worth increasing to ₹301 crores as of March 31, 2025, up from ₹236 crores in FY24. Cash and cash equivalents, including investments in securities, also saw a significant increase to ₹148 crores from ₹101 crores in FY24. An increase in finance cost in Q4 FY25 to ₹2.2 crores was attributed to a provision for delayed payments, which management expects to resolve, and increased lease liabilities due to a new office relocation.