Le Travenues

Le Travenues reported a robust Q3 FY25, with overall Gross Transaction Value (GTV) reaching INR 4036.3 crores, marking a 48% increase year-over-year. Revenue from operations grew by 42% Y-o-Y to INR 241.8 crores, also showing a 17% sequential increase from Q2. The company achieved its highest-ever EBITDA of INR 24.3 crores in Q3, contributing to a doubled 9-month YTD EBITDA of INR 68.2 crores. These results were driven by significant market share gains across all business lines, with the rail segment's estimated share now at 58% as of December 2024.

The flights and buses segments were key growth drivers in Q3 FY25. Flights GTV surged by over 73% Y-o-Y to INR 1682.6 crores, while buses GTV grew by over 63% Y-o-Y to INR 494.6 crores. The train segment, despite a one-time^📎 negative impact from changes in the advance reservation period, still recorded a 27% Y-o-Y GTV growth to INR 1828.3 crores and a 21% Y-o-Y increase in passenger segments. The company noted that its flight business is now among the top four OTAs in India by GTV and passenger segments.

While overall contribution margins grew by 32% Y-o-Y to INR 102.5 crores, the contribution margin percentage slightly decreased from 45% to 42%. This compression was attributed to strategic investments aimed at accelerating growth. Management emphasized that these investments are deliberate, focusing on sustainable growth and enhancing customer experience, even if it means a temporary impact on margin percentages. The bus segment's contribution margin percentage also saw a slight dip from 68% to 66%.

The company is making significant investments in technology and AI, with a vision to deploy more AI agents across the organization to automate tasks and improve efficiency. These one-time^📎 investments are expected to yield operating leverage over time, alongside incremental NPS gains and conversion rate improvements. The AI Chatbot Tara already handles 1.59 million customer queries per quarter end-to-end, covering 92% of customer support reach-outs, demonstrating early success in leveraging AI for operational efficiency.

The hotel business is in its early stages of product market fit and supply build-out, with management acknowledging it will be a long-term endeavor, similar to the 10 years it took to establish their train business. However, month-on-month and quarter-on-quarter growth is being observed from a smaller base. The company also launched 'Travel Guarantee' as a new value-added service, offering up to 3x refund for wait-listed tickets that don't confirm, which has seen positive initial response and uptake.

Le Travenues is observing significant growth in Tier 1 to Tier 1 flight passenger segments, which have grown over 68% year-on-year in Q3. International flight segments also grew by 61% year-on-year in the same period. The company is actively deepening partnerships with international carriers and enhancing features like 'ixigo Assured' for international routes to improve supply and content, aiming to better serve Tier 1 users and expand its footprint in the international travel market.

The profit after tax for Q3 FY25 was INR 15.5 crores, a notable decrease from INR 30.6 crores in Q3 FY24. This was primarily influenced by a shift in tax expenses, moving from a credit of INR 16.7 crores in the prior year to an expense of INR 5.9 crores this year. This change was largely attributed to a deferred tax credit reversal, impacting the reported profitability for the quarter.