Thomas Cook India : TCIL Q4 & FY25 Transcript

Published: 2025-05-20 08:40:06 ET THOMASCOOK.NS

Published on 05/20/2025 at 08:40

I now hand the conference over to Ms. Purva from Batlivala & Karani Securities India Private Limited. Thank you, and over to you, ma'am.

Before I begin to give you a commentary on the Q4 and FY '25 performance, I'd like to introduce the management team who joins me on the call today. I have with me in the room, Vishal Suri, Managing Director and CEO of SOTC Limited. I have Debasis Nandy, President and Group CFO, Thomas Cook India Limited; Brijesh Modi, CFO of Thomas Cook India Limited; Vikram Lalvani, MD and CEO of Sterling Holiday Resorts; and K.S. Ramakrishnan, MD and CEO of DEI. I'm also joined by Urvashi Butani, whom you all know, manages the Investor Relations.

As you can see, Thomas Cook India Limited delivered a robust set of numbers for the full year ended March 2025. Our results demonstrate not only a resilient financial performance, but more importantly, the strategic momentum across all our business verticals. We have continued to build our strength while adapting to the evolving industry landscape with agility and foresight.

Before I get into the numbers and dwell into it, I'd like to mention that Thoms Cook India Limited was presented the Best Annual Reports Award 2024 in the travel service category presented by Free Press Journal.

Moving on to the performance for the full year as well as the quarter. Income from operations for the quarter ended Q4 of FY '25 grew 18%. And consequently, our profit before tax improved by a sharp 51%, moving from INR 61 crores to INR 92 crores. If I look at the full year numbers, our income from operations grew from INR 7,299 crores to INR 8,140 crores, registering a growth of 12%. Consequently, our profits before tax improved from INR 345 crores to INR 385 crores, which is a growth of 12%.

As you will appreciate that this quarter typically is an investment quarter, but for 2 consecutive quarters in FY '24 and in FY '25, the quarter turned to be profitable. Goes on to reflect upon the fact that the seasonality of travel is beginning to ebb off and you will start seeing more of a flattened curve as we go along.

Some of the factors that are driving our performance or drew our performance in Q4 and for the full year was strong performance in the travel and travel-related segments, foreign exchange, Sterling Holiday Resorts. The one business in our group that didn't do well is DEI, and Mr. Ramakrishnan will dwell upon that during his conversation.

Let me first start talking about the quarterly performance. On the profitability front, as I said, our profitability grew by a sharp 51%, moving from INR 61 crores to INR 92 crores. And I think that's the

highest ever quarterly profit that we've seen for this specific quarter. If I look, this was aided by a strong performance on the travel and travel-related segments.

While on the foreign exchange segment you will see a slight bit of degrowth on the EBITDA margins, and that's largely on account of the front-loading of investments that we did, and I will cover that when I speak about the foreign exchange services.

I like to quickly dwell on the financial services segment before I move on to the travel segment. Our financial services reported a 14% growth in revenue with EBIT margins at 43% for Q4FY25. For the corresponding period in the full year, our income from operations grew by 8% and EBIT improved by 21%, moving from INR 124 crores to INR 150 crores. Our EBIT margins improved from 41% in FY '24 to 46% in FY '25, and this is largely in line with what we had guided the market to the range of 40% to 45%, and we believe that's the range the business will operate in.

Some of the key highlights for the performance for the quarter and for the full year has been the strong growth on the retail segment. Our retail volumes grew by 11%. You'll appreciate that the numbers that you see in the results does not reflect the gross output. It only reflects the revenue from businesses. I'm trying to give you a lens on the gross volumes that we have clocked in. Our retail volumes grew by 11%, aided by education segment, which grew 26% Y-o-Y and the holiday segment grew by about 5% Y-o-Y.

If I look at the corporates, that was another segment, which grew about 3% year-on-year. Our prepaid card business had a very strong momentum. Our overall volumes inched closer to the $1 billion mark, growing by about 5% as compared to FY '24. And consequently, our float on the business inched closer to about INR 1,325 crores.

From a card segmentation point of view, I've spoken about it in the past. We had an Enterprise Card focused on the corporate segment. We had the Study Buddy Card focused on the education segment. And I'm happy to report that in the quarter that went by, we launched our holiday card called the Borderless Prepaid because this segment that we are referring to is the largest segment as far as the LRS data is concerned.

If you look at the LRS data published by RBI, the total volume is roughly about $30 billion exit in FY 2024. And I think the FY '25 numbers will be closer to that or a shade lower, considering that the numbers till February was 1% lower than what was reported in FY '24. Given that we are looking at

an addressable market of about $18 billion, consisting of the enterprise business as well as the holiday travellers, this was a big opportunity for us, and we wanted to do a big bang approach.

And hence we roped in a brand ambassador in the form of Kartik Aaryan. It's an investment that we have made, and this is one of the reasons why our EBIT margin as well as the EBIT for the quarter came in a little lower than what we delivered in the same quarter of last year. This is a front-loading of the investment. The returns on that will come in the subsequent quarters.

One more point on the forex side. Our digital adoption continues to be very strong. Our digital adoption has moved from 20% to 21% in the quarter and for the full year remains at about 21.5%. So, we have seen a steady progress as far as our digital adoption is concerned. Digital KYC, the WhatsApp tool, the FX mate tool, I think all the digital tools that we use in the marketplace are seeing good traction, and we will continue to build on the momentum that we have created.

Moving on to the travel and travel-related segments. As you can see, we've given a little more color to it in our investor's deck. It consists of 2 parts, B2B and B2C. The B2B contributes about 74% of the overall volumes and the B2C businesses contribute 26% of the overall volumes. We had a very strong growth across both the segments, which is the B2B and B2C. My colleague, Debasis, will talk about the B2B segment and specific reference to the DMS units, India and International, and I'll walk you through the B2C segments here.

If you look at the B2C segments for the full year on a comparative basis, our overall volumes grew 20%, moving from INR 1,463 crores to INR 1,750 crores and for the quarter moved up from INR 253 crores to INR 303 crores, reflecting a strong double-digit growth. I'd also like to highlight here that for the fourth quarter of FY '25, both the international domestic and the overseas international business came higher than the pre-pandemic numbers.

This is something that we've been calling out for some time saying that we expect the recovery to happen, but the last quarter saw the recovery higher than what we had in the pre-pandemic levels. Obviously, for the full year, it still trails. That's because the first 3 quarters were not so strong. The recovery on the long haul did not pan out as expected, but the last quarter was a very strong one, and that kind of aided the profitability and the growth in the income from operations.

Moving on to the MICE and the corporate travel segment. We had some strong momentum both on the MICE side as well as on the corporate travel side of it. On the MICE side of it, you will recollect

that the large part of FY 2025, we didn't have any government business. But the last quarter, which we called out in the previous earnings call, we were executing a government business, which is the National Games in Uttarakhand. We completed that in mid of February 2025 and clocked a volume of about close to INR 100 crores, which kind of helped the business.

What's important, if you compare it from FY '24 to FY '25, you'll see that despite the government business coming about 50% lower than what we had in the previous financial year, our corporate business grew by 6% from INR 1,188 crores to INR 1,256 crores.

On the corporate travel side, I think typically, March is a low quarter, seasonally low quarter, , because a lot of budgets got frozen and the new budgets are allocated much later. So, we had a bit of a slower offtake, I would say. And there is also some impact of the tariffs that came in because there was a lot of ambiguity about what the impact of it on corporates. So, we saw a bit of a delayed decision-making. Also, some of the new wins that we had, which were likely to go live in the last quarter of FY '25 is actually moving on to the first quarter of FY 2026.

Overall, I'm happy to report that our focus on improving our non-air share on the corporate travel has worked. While our non-air share in the previous year FY '24 was 6%, it's trend up 200 basis points higher at about 8%. And I think that's a healthy sign because that improves our yields and margins in the businesses. We've continued to acquire new customers on the corporate travel segment, and we added about 11 new corporates in the quarter in question.

On the B2C side, before I hand over to Debasis, I just want to mention that we continue to expand our distribution network. Between SOTC and Thomas Cook, we've added close to about 11 locations during the quarter and for the full year, roughly about 21 new locations. That represents about roughly 12%, 13% of our overall distribution network. And we continue to invest in growing our distribution more specifically in the Tier 2 and Tier 3 markets.

Our digital spends and our digital adoption continues on the holiday side, and we continue to invest in newer technologies, and you will realize that we've actually went live with Tacy and EZY, the 2 voice bots or rather chatbots that we have made live, which enables customers to convert web leads into leads, which can then be converted into actual bookings. I think overall, I'm pleased with the performance of the group. I think we have had a good set of numbers. And I'll now hand it over to Debasis to take you all through the DMS units, both India and international. Over to you, Debasis.

Disclaimer

Thomas Cook (India) Ltd. published this content on May 20, 2025, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 20, 2025 at 12:39 UTC.