Indian Railway Catering and Tourism Corp (IRCTC) Q4 FY21 Earnings Concall Transcript

Indian Railway Catering and Tourism Corp (NSE:IRCTC) Q4 FY21 earnings concall dated Jun. 30, 2021.

Corporate Participants:

Anshuman Deb — Assistant Vice President ICICI Securities Ltd.

Rajni Hasija — Chairman & Managing Director

Ajit Kumar — Director, Finance

Analysts:

Jinesh Joshi — Prabhudas Lilladher — Analyst

Urmil Shah — Haitong Securities — Analyst

Rahul Jain — Daulat Capital — Analyst

Richard D’Souza — State Bank of India Mutual Fund — Analyst

Varun Goenka — Nippon India Asset Management Company — Analyst

Manan Thakkar — ICICI Securities — Analyst

Mayank Babla — Dalal and Broacha — Analyst

Niket Shah — Motilal Oswal Mutual Fund — Analyst

Dhruva Mukherjee — Malabar Investments — Analyst

Ashish Agarwal — Principal India — Analyst

Presentation:

Operator

Ladies and gentlemen, good day and welcome to IRCTC Quarter Four FY ’21 Results Conference Call, hosted by ICICI Securities Ltd. [Operator Instructions].

I now hand the I now hand over the session to Mr. Anshuman Deb, Assistant Vice President ICICI Securities Limited. Thank you, and over to you, sir.

Anshuman Deb — Assistant Vice President ICICI Securities Ltd.

Thanks Mallika good morning, ladies and gentlemen. It is an honor and privilege host Indian Railways Catering and Tourism Corporation Ltd., for their Q4 and FY ’21 Results Call. Representing the company we have Smt. Rajni Hasija, Chairman and Managing Director and Shri Ajit Kumar, Director, Finance and CFO. We would request Honorable Chairman and Managing Director to start the session with her opening remarks, post which we will open the floor for Q&A.

Thank you, and over to you, ma’am.

Rajni Hasija — Chairman & Managing Director

Thank you very much. A very good morning to everybody. I welcome you all to this con call of IRCTC Ltd. for the quarter and the year ended on that because March 31, 2021. I hope that you and your dear are safe in these challenging times of COVID, which has affected each and every quarter of our life. Yesterday, our company had announced the audited financial results for the fourth quarter and the year ended of fiscal ’21, and same has been disclosed on both the stock exchanges too. We all know that the COVID-19, the pandemic has had a bigger impact on the Indian Railways operation, and all our business segments. In fact, it has been the worst year for the tourism and hospitality business. However, despite all the headwinds and challenges, IRCTC has shown remarkable improvement in its operation and financial operation. That will be evident from our results, if we compare quarter one with quarter two and quarter three and quarter four, there has been a consistent improvement.

I shall now hand over the con call to our Director Finance and CFO, Shri Ajit Kumar, who will provide you details of the quarter and the year ended, results for the fiscal 2021, post which we shall have a question-and-answer session with you all. Thank you.

Ajit Kumar — Director, Finance

Good morning, everyone. This is of course, in the pandemic times, whatever the best we have been able to achieve, so that we have tried, and these financial figures sit here like this. Q4 FY ’21 revenue was INR339 crores and saw a sharp improvement of 51% quarter-on-quarter. On a year-on-year, it continued to face the headwinds of the pandemic. EBITDA margin came at 42.8%, which was another high, and saw an improvement of about 60 bps quarter-on-quarter. On a year-on-year basis, the EBITDA margin was much higher than 34.4% in Q4 FY ’20. Net profit before exceptional items was at INR107 crores, which implies a growth of around 36% Q-o Q and a decline of 29% Y-o-Y.

For FY ’21 revenue came at INR783 crores, which is a decline of course 66% Y-on-Y and EBITDA margin came at 24.3% versus 31.4% Y-o-Y and net profit before exceptional items came at INR150 crores versus of course INR527 crores year-on-year basis.

Let me now move to the business segments of the company, number one will be of course the star, the Internet ticketing. Internet ticketing has been the most resilient business segments in these challenging times. The Q4 FY ’21 revenue Internet ticketing came at INR212 crore, adding [Phonetic] an increase of 48% Q-on-Q and decline of just 7% Y-on-Y. The EBIT margin for the segment also saw sharp improvement Q-o-Q to 83.3%.

In Catering segment, I discussed in our previous earnings call, has been severely hit by the pandemic. While the revenue for the segment has been improving Q-on-Q basis. However, it continues to be lower on year-on-year basis. For Q4 FY ’21, it was INR67 crore and then minus 75% year-on-year basis. I discussed, earlier this segment has seen restrictions, like only ready-to-eat and no food on-board. Our sealed pack meals being allowed, for meals to be ordered through e-catering, versus the earlier one, that is the pre-cooked meals being served in the pre-pandemic era. However, the company has been able to reduce the losses, both on absolute basis and EBIT margin level.

The next segment is Tourism segment. Of course it’s worldwide, this effect is there, that this has been the most severe hit of the pandemic for us, as well as for the industry. The Q4 FY ’21 revenue though more than doubled Q-on-Q to INR32 crore, it is still 80% lower than Q4 FY ’20. This has — of course there is impact on the profitability of the segment.

Now Railneer, the next segment has also seen Q-o-Q improvement throughout the year. I mean just after the — the moment it started locking and so therefore this segment started — the earning started here. In Q4 FY ’21, its revenue improved by 64% Q-o-Q, to INR278 million.

For Q4 FY ’21, the capex was INR46 crores and for FY ’21 it has been INR73 crores. The company continues to have a strong balance sheet with a net cash of INR1,460 crores and net worth of INR1,466 crores. Q1 FY ’22 has again seen the surge in COVID-19 infection and the same has been brought under control. We have also seen significant improvement in vaccination. Although, the third wave infection and impact of it, still remains uncertain. At IRCTC, we will try and fight the tough situation, as we have done in FY ’21, and I’m confident that we could come out of it, even a stronger.

We can now move to the question-answer-session. Thank you.

Questions and Answers:

Operator

Thank you very much. We will now begin the question-and-answer session. [Operator Instructions] The first question is from the line of Jinesh Joshi from Prabhudas Lilladher. Please go ahead.

Jinesh Joshi — Prabhudas Lilladher — Analyst

Yeah, thanks for the opportunity. Two questions. Sir first, can you help us what is the convenience revenue and number of tickets booked in FY ’21?

Rajni Hasija — Chairman & Managing Director

The ticket booked in year — 2021 year, around the 1,740 lakh tickets have been booked, which is almost 50% of the ticket that we had booked in the previous year.

Jinesh Joshi — Prabhudas Lilladher — Analyst

And what is the convenience revenue?

Rajni Hasija — Chairman & Managing Director

Convenience, see that we have realized in the year 2021, was around INR299 crores.

Jinesh Joshi — Prabhudas Lilladher — Analyst

Okay, madam. And secondly if I look at our 4Q numbers with respect to the Tourism division, then what I see is that the EBIT loss is higher than the revenue. So is there any element of one-off here? And secondly, if I understand correctly, majority of our receivable pertains to catering. So while our catering revenues have gone down from INR1,000 crores to approximately INR220 crores in FY ’21, the quantum of fall in receivables is not that high. So how should we be reading into this?

Rajni Hasija — Chairman & Managing Director

I’ll answer your second question first. You said, your trade receivables have gone down, and the rate is not in commensuration with the revenue earned. Actually, both cannot be compared, because the trade receivable which you were seeing since — at the closure of the last year fiscal, was around INR777 crores, this was including the — all the trade receivables of the previous years also. So this year, for the first time, we have — since there was no accumulation of the other areas, so IRCTC focused on decreasing the trade receivable and realized old outstanding dues from the railways. So the reduction level will be different, although it is very hard and we improved by 30% or so.

And while the revenues of the Catering have gone — is almost 22% of the — you can say of the previous year, so it is not in commensuration with sales [Phonetic], because cannot be compared. Most of our trade receivable from the railways have been in the Catering segment. Majority of them, the 90% of them are from the catering segments. Yes, but the total figure of the trade receivable, although — includes every segment. Both cannot be compared. This is the outstanding of the previous year. The revenue generation is affected because of the COVID, and the pattern of the business and the pattern of the travel. Because in the first quarter, we didn’t have any trains, and we show — for the first time, we showed a loss. In the second quarter we had rains introduced. Third quarter, numbers of trains further improved. Fourth quarter, initially, the train numbers reduced, then they were increased, because April was very bad, April and May. April and May though were bad, but till March, we could get more trains.

Jinesh Joshi — Prabhudas Lilladher — Analyst

Okay, madam. And that Tourism part if you can answer?

Rajni Hasija — Chairman & Managing Director

I could not follow…

Jinesh Joshi — Prabhudas Lilladher — Analyst

The EBIT loss is higher than the revenue reported?

Rajni Hasija — Chairman & Managing Director

Because of the prepaid — the prepaid traffic, which we used to have earlier. If we see the Catering segment, our earlier sales from the prepaid segment, used to be around INR500 crores, which is not there now. Since you’re asking about the Tourism; in Tourism, many segments like Maharaja, State Teertha, they never moved, and this air ticketing also fall. Then various train operations could not happen. All our railways tourism was put to an halt, almost fault [Phonetic], it is only in the January, we picked up a bit.

Jinesh Joshi — Prabhudas Lilladher — Analyst

Okay, madam.

Operator

Thank you. The next question is from the line of Urmil Shah from Haitong Securities. Please go ahead.

Urmil Shah — Haitong Securities — Analyst

Good afternoon, madam, and thanks for the opportunity. Madam, first question was on the non-service charge revenue within Internet Ticketing. We’ve done a commendable job in — at a time when the volume decline has been severe. So just wanted you to throw some light, as regards the different subsegments of the service charge revenue, and outlook for FY ’22 and ’23?

Rajni Hasija — Chairman & Managing Director

In 2021, the total revenue from the Internet Ticketing segment has been around INR448 crores. Although this is 27% lesser compared to the previous years, because of the less number of trains being operated, and the number of [Indecipherable] booked have reduced to half. The share of the convenience fee in this INR448 crores have been to the tune of 66%, that is INR299 crores and rest of the segment is non-service charge or non-convenience fee, like thirty three point something percent is from that segment. Out of which annual maintenance of different schemes and annual other API integration charges, amounts to around INR100 crores, and other businesses like loyalty cards, etc. was there. So 66% was the contribution of convenience fees, rest is the other businesses, in the Internet ticketing segment.

The promotional schemes and the other schemes could not take of well, because advertising agency was seeing a very dull phase, and not many advertisers are ready to go through the Google DSP tool also, where the rates were made highly reasonable, very competitive. Rest of the revenue, like annual maintenance, etc, some leverage was also even to our licensees, to our service providers and partners, because in the two months, they could not do any booking. So those chapters were adjusted also. This has impacted the overall contribution in that segment.

Urmil Shah — Haitong Securities — Analyst

Sure. Ma’am, specifically if you could help with the income from our own payment gateway and on [Indecipherable] advertisement income for this year?

Rajni Hasija — Chairman & Managing Director

You mean to say, iPay, right?

Urmil Shah — Haitong Securities — Analyst

Yeah, iPay, yes ma’am.

Rajni Hasija — Chairman & Managing Director

So the iPay income has being — contribution has been around 7%. Yeah. It is like — I’ll give you the right figure, give me one minute.

Urmil Shah — Haitong Securities — Analyst

Yes ma’am.

Rajni Hasija — Chairman & Managing Director

It is around INR15 crores this year we have received from iPay. Last year, we have received around INR28 crores.

Urmil Shah — Haitong Securities — Analyst

Sure, sure. And ma’am the team number for advertisement for this year?

Rajni Hasija — Chairman & Managing Director

Advertising revenue has — from SMS, it has been very less. I think put together, it is around INR9.78 crores, advertising revenue, that is inclusive of all banner, SMS, advertisements, government advertisements, non-government advertisements, put together all.

Urmil Shah — Haitong Securities — Analyst

Sure, sure, sure. Ma’am, I just wanted an understanding on the, you know, a margin profile of iPay. So there would be a combination of MG plus revenue share. So if we look at FY ’22 and ’23, where there would be a normalization, as regards the volume on our network, what would be the kind of revenue share that will have to be done with the partner?

Rajni Hasija — Chairman & Managing Director

So actually, the revenue sharing along with the partner transaction, we should understand the business in totality. First is that, in the UPI, there is no share. UPI payments happening through iPay, does not have any share. In debit cards, few debit cards have, and any payments below INR2,000 also does not have share. So after that, whatever is left, there is a sharing of around 40-60 for iPay between us and the party, our partner. So you can say, the commission received from iPay, it includes the transaction charges and the commission from the bank. Commission and sharing, we share with our partner, the interchange the commission that we share. We share with the bank also. First bank takes, after deducting the bank amount, whatever is left, it is shared 50-50 between two accounts.

Urmil Shah — Haitong Securities — Analyst

Sure, sure. And ma’am, what could be the share of UPI transactions? Because I believe this year, the proportion of non-AC volume would have been higher. So how has the share of UPI moved?

Rajni Hasija — Chairman & Managing Director

24% 24.18% the total tickets being booked from our website, through UPI handle is 24%, debit card is around 22%. So more than 40% is gone without transaction charges here. So rest, we earn revenue on the net banking, credit card, auto pay, BharatQR also has some money like that.

Urmil Shah — Haitong Securities — Analyst

Sure. Ma’am, I want — I think the UPI share in the number of ticket overall?

Rajni Hasija — Chairman & Managing Director

It is around INR420.78 lakhs, out of these 1,700 tickets, 24%.

Urmil Shah — Haitong Securities — Analyst

24%.

Rajni Hasija — Chairman & Managing Director

Yeah.

Urmil Shah — Haitong Securities — Analyst

Okay. Yeah sure. Ma’am, last question was, we know now that the catering was announced during the Q4 — e-catering I am referring to, and we had talked about, we looking at tie-ups with the aggregators. If you could comment on how has the traction been on e-catering, and how are the talks with the aggregators going on for onloading it to our platform?

Rajni Hasija — Chairman & Managing Director

Are you specifically asking about e-catering, or you are asking in general, about the catering, Urmilji?

Urmil Shah — Haitong Securities — Analyst

Ma’am, I must about e-catering only.

Rajni Hasija — Chairman & Managing Director

Right. So in the case of our e-catering, we have made certain changes in our policy and the aggregator model also. Fortunately, in the e-catering, we are also — we have done a few new tie-ups and we have increased our commission from 12% to 15% marginally. So, there is going to be some benefit and bookings are — booking through e-catering is going up. Very recently, we have opened booking of e-catering food through our B2C partners also. Ixigo, MMC and MobiKwik and the two others — I think three, four, other lead partners of B2C business have opened e-catering for us. So this has given some increase and when initially we started, we were booking around 1,000 meals etc. Gradually from 1,000 meals now in the — on the holiday, we have reached up to 12,000 or 11,000 meals also.

Although the number of tickets being booked is almost 50%, that we were booking earlier. So the — we — I can say that we are about to reach the pre-COVID level very soon, if this trend goes on, because more and more B2C partners are going up. So we are finding some light in the elixir [Phonetic].

Urmil Shah — Haitong Securities — Analyst

Sure ma’am, Many thanks for the explanation. I’ll come back for follow-up. Thank you.

Operator

Thank you. The next question is from the line of Rahul Jain from Dolat Capital. Please go ahead.

Rahul Jain — Daulat Capital — Analyst

Yeah, hi ma’am. Firstly, if you could tell us in terms of what is the of numbers of trains operational at the end of March, and what is the status today? And similarly on the number of food units that are operational at the end of March and as of today, approximation?

Rajni Hasija — Chairman & Managing Director

See, I can, you had asked about the number of trains and what was your second question?

Rahul Jain — Daulat Capital — Analyst

Number of food units and pantry cars?

Rajni Hasija — Chairman & Managing Director

Food units and pantry cars. So pre-COVID, we had 470 pantry cars operational. Now we have around — more than I think 250 pantry cars are operating. But this number is very dynamic, because the trains being announced, these are special trains and it is of a very lesser frequency, two months, three months. The number of our trains are changing very fast also. So the that number I may be telling you now, may not be there tomorrow.

Rahul Jain — Daulat Capital — Analyst

Yeah, understand. And this 250 is as June, or this is you’re saying of March?

Rajni Hasija — Chairman & Managing Director

This is as on date.

Rahul Jain — Daulat Capital — Analyst

Okay.

Rajni Hasija — Chairman & Managing Director

Up to March, I don’t have figure rightly available.

Rahul Jain — Daulat Capital — Analyst

Okay. And overall train basis — number of train basis?

Rajni Hasija — Chairman & Managing Director

Even if there is not a — pantry car is not there, we still have a train side vending and we still have a train side vending contract from these trains. So no train is leaving being left alone without a contract. Each train is revenue for us.

Rahul Jain — Daulat Capital — Analyst

Right. So the total number of trains, which were operational in March and let’s say now?

Rajni Hasija — Chairman & Managing Director

You can say, it has increased by 20%, from the March. Because 800 — recently more trains were announced, and gradually, we are getting trains in a phased manner. Initially, we got 130 trains, then we got 140 trains. It is being increased every month, rather every week.

Rahul Jain — Daulat Capital — Analyst

Yes. So 800 is the recent most status and this is 20% higher than March status?

Rajni Hasija — Chairman & Managing Director

Yes.

Rahul Jain — Daulat Capital — Analyst

Okay. And in the catering business, wherever we are coming up for renewals, what are the like-for-like revenue, we are collecting? Let’s assume there is a renewal for Chennai station, so what was the license fee on an average, they were paying pre-COVID versus what is the percent today?

Rajni Hasija — Chairman & Managing Director

See COVID has not ended fully. Footfall at the station has not gone up by the — at pre-COVID levels also. So the trains, only the reserved segment travel is permitted, other than the suburban traffic. So many of the stations are not having adequate footfall. So food plaza and effective units are being operated at a reduced license fee. Incremental increase in the license fee that happens normally annually, will happen after, I think, two, three months, when the footfall is restored to normalcy. The force — when the units were closed by the states, the dry zone period starts, and in the dry zone period, you have to hold hand of licensees, so that he is able to fulfill the obligation — contractual obligations.

Just to provide services to the customers, they were persuaded to open all the units at a reduced license fee. Now today — that period is ending today. Today, we are going to decide how much license fees they will be working, because the footfall in these — at the station has not reverted back to pre-COVID levels yet. And total number of passengers, though in the reserved segment is more, but unreserved because of at-station sale through foot units is happening through — under that segment also. That is not adjusted. So desired footfall is not there for them. So we have to work with them on a reduced license fee. Increment will happen, once normalization is restored.

Rahul Jain — Daulat Capital — Analyst

Right. And on the tourism side, are losses, even on a quarter-to-quarter basis? What I mean to say Q3 ’21 versus what it is today, it has increased from INR11 crores to INR42 crores. So is it because we started the Tejas operation and also the Golden Chariot, which was started during this quarter. Is it some one-time expenses, we have incurred towards Golden Chariot marketing or refurbishment or for Tejas, which has resulted in INR30 crores higher losses on a Q-o-Q basis?

Rajni Hasija — Chairman & Managing Director

Oh, that is because of the provisioning needs. See, including COVID period, the Tejas and Mahakal operations were canceled like other trains. But unfortunately somehow the — we have been asked to — the provisioning was made for the fixed charges. Fixed charges are to be paid for the operation of Tejas and Mahakal, because we have taken these rates on lease from railways. There are fixed charges for that. But since the operation was not happening, we have represented to Ministry of Railways for waiver of these charges, which is under consideration; because dry zone period, as is applicable for the normal licensees, is applicable for IRCTC as well. So we have represented — we were given some relief initially, but that relief was not in commensuration with the total amount charged. So we have re-presented again to Railways. So we have made a provisioning for that. Maybe once we get the approval, this will be counted in the revenue in the next quarter.

Rahul Jain — Daulat Capital — Analyst

Right. So out of out of this INR44 crore losses, what is this provisioning? And is it for the full year, instead of one quarter…

Rajni Hasija — Chairman & Managing Director

INR28 crores is the provisioning sir.

Rahul Jain — Daulat Capital — Analyst

Okay. And this is for more than three months, which we have done in this quarter?

Rajni Hasija — Chairman & Managing Director

Actually for the entire year.

Rahul Jain — Daulat Capital — Analyst

Okay. So basically, in the earlier period, we were not assuming this as a cost, and that we have accounted in this cost?

Rajni Hasija — Chairman & Managing Director

It was entering as a cost, but when he started CAGR, in the first six months in ’19-’20, we have already built in and we have paid to the Railways also, this cost, and that was in our expenditure. But unfortunately in 2021, in the beginning of ’21, Tejas had to be cancelled.

Rahul Jain — Daulat Capital — Analyst

Right.

Rajni Hasija — Chairman & Managing Director

So that is why, you can see it very categorically, that trains were not being operated, and which is there in our footmarks also. That provisioning for INR28 crores has been made this year. The document that we have submitted to stock exchange.

Rahul Jain — Daulat Capital — Analyst

So, basically this INR28 crore amounts to the leasing charges for period of January till March?

Rajni Hasija — Chairman & Managing Director

Leasing charges and the fixed [Indecipherable] charge.

Rahul Jain — Daulat Capital — Analyst

Okay. This is only amounting for one quarter only?

Rajni Hasija — Chairman & Managing Director

No, sir. It is for the entire year for non-operating year, for which we were told to pay by Ministry of Railways.

Rahul Jain — Daulat Capital — Analyst

Okay. Just for the total quantum for the full year.

Rajni Hasija — Chairman & Managing Director

Yes.

Rahul Jain — Daulat Capital — Analyst

Earlier, the fixed lease charges and haulage charges were not expensed during the quarter, and that’s why all of them have accumulated to INR28 crores, which is charged in this quarter?

Rajni Hasija — Chairman & Managing Director

Yes.

Rahul Jain — Daulat Capital — Analyst

And any significant spend we have done on the Golden Chariot during the…

Rajni Hasija — Chairman & Managing Director

Golden Chariot, most of the marketing was done via local offices. It’s only the digital marketing we did. No paper advertisement, nothing we did. We have not resorted to any press releases, other than Bharat Darshan, where we had a very pretty — we have done a very petty expenditure. In fact we had — our total expenditure on the marketing, would not have crossed even INR1 crore.

Rahul Jain — Daulat Capital — Analyst

Right. So now…

Rajni Hasija — Chairman & Managing Director

We spend mostly on digital media. We hardly spend on print media.

Rahul Jain — Daulat Capital — Analyst

Right. Just to get the understanding, so in this quarter, when we report the April-May-June quarter, the losses in this period could more be online, sort of what we saw in Q3, because this one-time INR28 crore thing will not be there, so it will be reduced by this amount in the subsequent quarter?

Rajni Hasija — Chairman & Managing Director

It may be reduced. Yes, it may be reduced in the first quarter or second quarter this year. If we get approval — from the moment we get approval from Ministry of Railways, for which we are working very hard, we have also presented. But I would say in a very coordinated manner and we appear to be very much convinced. So — when we get the letter.

Rahul Jain — Daulat Capital — Analyst

Much appreciated ma’am. Thank you. That’s it from my side.

Operator

Thank you. The next question is from the line of Urmil Shah from Haitong Securities. Please go ahead.

Urmil Shah — Haitong Securities — Analyst

Thank you, ma’am for the follow-up. Ma’am not sure whether it is the right time to discuss on this, but just wanted the thoughts on the train privatization program. Last quarter, we had said that the process is getting delayed. So one, an update on the same? And is there any update on our plan for a JV or leasing out option?

Rajni Hasija — Chairman & Managing Director

See, the date of submission of RFP has been extended from 30th June to 23rd of July, first is this. Secondly, IRCTC had — was very much in the race. I told you that we had told earlier — in the earlier conferences also, that IRCTC has been qualified for almost 11 clusters, except for the Bangalore cluster. 10 clusters, because Hyderabad, we did not apply. Our stand remains the same. We are in process of getting our partner. This slight change in our strategy, because now we are looking for a strategic partner, who can go ahead with us for more than other trains — for all kinds of — all such kind of operations happening in the future. So expression of the expression of that — expression of interest for that is already out and the date for closure of that RFP is going to be around — is around 2 July. 2 July we are closing that, and we are also in talk with many rolling stock providers and other financial houses, so that we can find a partner, who can spend some money.

As you can see that, there is some change in our segmental revenue also. So we have to find out a partner first to go ahead in this tender. So that we can participate in more clusters.

Urmil Shah — Haitong Securities — Analyst

Sure. Ma’am, did I understand it correct that, you are looking at a partner who can participate in this league of privatization and also on other operations like the Tejas trains etc?

Rajni Hasija — Chairman & Managing Director

It is a strategic tie up. It is a strategic tie up, where we are looking at partnership person for who can — who can spend some equity in the company. Though we have results, but we can spend it all, otherwise, our development will come to a halt. So we need to have a person, and we are in — probably we shall be forming a SPV or JV subsequently. Right now SPV is on the card.

Urmil Shah — Haitong Securities — Analyst

Sure, sure. Ma’am, just last thing was on the bus ticketing business. Has that seen a pickup through the lockdown, or we’ll have to wait for one, things to normalize and our volume also to augment, which might happen during the year?

Rajni Hasija — Chairman & Managing Director

If you see the previous year, 2021, the number of tickets booked, had reduced to half. In April, It further reduced for few days because many trains were cancelled. May picked up a bit. But in June, there has been a very good increase. On few days, we were booking around close to 10 lakhs tickets in a day. So I can say, the trend is very positive, with more trains being introduced and the 2S class being there, the internet booking in June to has been much better than the previous year. Of course years, we had COVID, and previous June also.

Urmil Shah — Haitong Securities — Analyst

Ma’am my question was more on the bus ticketing business?

Rajni Hasija — Chairman & Managing Director

Bus ticketing. I am sorry, I considered that as railway ticketing. Bus ticketing has started picking up. Initially, there were hiccups, with the lockdown happening, because this is being driven by many state governments. It has started picking up. But the pace is very slow. I must say, pace is very slow. We are now planning a marketing along with our partners.

Urmil Shah — Haitong Securities — Analyst

Sure. Thank you so much.

Operator

Thank you. The next question is from the line of Richard D’Souza from State Bank of India Mutual Fund. Please go ahead.

Richard D’Souza — State Bank of India Mutual Fund — Analyst

Good morning, ma’am. Just couple of questions from my side. I just want to know that currently you said that about 800 trains are operational somewhere in June. So pre-COVID, what are the peak number of trains operational?

Rajni Hasija — Chairman & Managing Director

See, I said 800 number of trains were ordered, that they will be operating. If I give you the correct figure, in the month of March, we had total 430 contracts for the train, for the catering, and now we have around 450 trains — contracts available, and 100 such contracts are in the pipeline. So these are the catering contracts. But our revenue from train is not only the catering revenue, it is the ticketing revenue also. So where the trains do not have pantry cars also, so if you multiply it by 2. So you can say, around 950 or 1,000 trains would be running. I’ll give you the exact number before I close.

Richard D’Souza — State Bank of India Mutual Fund — Analyst

Yeah, yeah, I just wanted to…

Rajni Hasija — Chairman & Managing Director

For right now, I will give you the exact number.

Richard D’Souza — State Bank of India Mutual Fund — Analyst

Yeah ma’am. I just wanted the number of trains, which are operational, for which ticketing is being done.

Rajni Hasija — Chairman & Managing Director

Okay. I’ll get you the number.

Richard D’Souza — State Bank of India Mutual Fund — Analyst

Let’s say pre COVID peak and currently now in March. March and June. So that was one number, if you could share? And the second thing is, when we moved the reservations basically from unreserved to reserved, that S2 category, also how many coaches were added or how much incremental tickets could be on offer?

Rajni Hasija — Chairman & Managing Director

I will give you the coaches that were added, were of that 2S class, right? So in the 2S class, our booking is amounting to be in the year 2021, the percentage booking for this particular class has been to the tune of 36%, which is slightly lesser than sleeper class, which is the highest, around 40%. So you can say, that second class is now beating and ranking with the sleeper class also. So the increment in the — everything has been basically due to this and the number of trains.

Richard D’Souza — State Bank of India Mutual Fund — Analyst

Okay. Thank you, ma’am. I’ll come back later and I would appreciate if you could share the number for the trains.

Rajni Hasija — Chairman & Managing Director

Yes, yes. Just stay for a while. I’ll get you.

Richard D’Souza — State Bank of India Mutual Fund — Analyst

Yeah ma’am. Thank you.

Operator

Thank you. The next question is from the line of Varun Goenka from Nippon India Asset Management Company. Please go ahead.

Varun Goenka — Nippon India Asset Management Company — Analyst

Yes, good morning ma’am, and thank you for covering it so well. My question is around ticketing; we were doing around 30 crores, 32 crore tickets before pandemic hit us, FY ’20 I believe. If you could give a sense of what is the kind of ticketing opportunity we have for the next three, four years, because there is a large non-PRS segment, of a lot of unresolved category. So where this 30 crore, 32 crore tickets become over the few years, when even normalization happens and government gives you more ticketing areas, opportunity related to managing the whole ticketing part?

Operator

Sorry to interrupt, Mr. Goenka, sir there is a slight disturbance coming from your line sir. Request you to mute your line when the management answers your question.

Varun Goenka — Nippon India Asset Management Company — Analyst

Sure.

Rajni Hasija — Chairman & Managing Director

Well, I would like to explain further, that it is not only that the reserve ticketing that we are doing, we are assisting in Indian Railways in the non-reserved segment also, because the payment gateway in the non-reserved segments are being provided by IRCTC only. But it is kind of a social service, where we are not getting any revenue. So it may not be of much importance to you. But whether we have been trying to get some share in the non-reserved segment also. in the form of convenience fee. But the amount of a ticket value is very, very low. So in order to promote the digital payments, Ministry of Railways has taken a call, that service charges will not be there, it is only the bank — the bank might be charging at their end. At many places, the bank may not be charging, because the transactions happening on these tickets are very low. So as of now, what I foresee that it is to getting percentage of the 36% will be the determining factor in the years to come. So in the next two years, this 36% figure will vary up to 40%, may go up to 40%, that is my personal thinking, and sleeper class also will go up, because you would have seen that, there is increase in the total traffic, earlier we were booking around 72% of the Indian Railways ticket. This year we have booked around 80% of the railways ticket, reserved segment.

So this 8% increase in the overall ticketing, don’t count by the number of overall percentage, the number of percent booked, if we see that, so we see some light over here. But if we — our effort in getting some share in the unreserved segment also succeeds, then we will be a double gainer later. At least, we have been trying.

Varun Goenka — Nippon India Asset Management Company — Analyst

Sure ma’am. Thank you. And on the payment gateway side, the efforts that we were making, if you could help us with the progress that side, so that eventually, all payments go to iPay itself and we have to share less with the bank.

Rajni Hasija — Chairman & Managing Director

It will not be in the interest of industry and being selfish on the part of IRCTC, if I put [Indecipherable]. Firstly, it’s not that iPay will be not handling the load. Why we have such a multiple solution? We take money from many of them. Transaction charges we share with them. Of course our share in the iPay is more as compared to the other pieces. There is no doubt about it. But we have to see that the percentage is at ease, and we should not get greedy to — gradually, we are proliferating but. Gradually, we are increasing the lead and the quorum, the plays, etc, we are changing, and end of the day, we are a government company with the 7% share of the government, where we have to ensure level playing for all of our partners. If I have iPay, I have CTCG also — sorry, I have [Indecipherable] also. I have Razorpay also with me, to be fair to them, they are also giving me much. So I have to take everyone along in this digital journey of India.

Varun Goenka — Nippon India Asset Management Company — Analyst

Right. Thank you. Just final point, will we eventually look to integrate all air ticketing, bus ticketing, railways…

Rajni Hasija — Chairman & Managing Director

It’s already there, already there. There I can, because these are my businesses, there we have given preference to iPay.

Varun Goenka — Nippon India Asset Management Company — Analyst

All right, thank you.

Rajni Hasija — Chairman & Managing Director

Preferences are there. It’s not giving preferences to iPay. In fact, we are going forward also oil in getting some licenses from RBI, so that we can take this iPay for other government agencies for Pay-as-a-payment mode. Efforts are on. Maybe next year, you will hear that.

Varun Goenka — Nippon India Asset Management Company — Analyst

Right. Thank you. Thank you. I will get back.

Operator

Thank you. The next question is from the line of Manan from ICICI Securities. Please go ahead.

Manan Thakkar — ICICI Securities — Analyst

Hello ma’am. My question is towards the capital expenditure across your IT infrastructure, across where you need it and the private doors [Phonetic] that we are planning to bid, as and when the bidding gets started. And if any other areas I have missed? What will be our capitalized [Technical Issues] over here?

Rajni Hasija — Chairman & Managing Director

This year we have spent around — we intended to spend INR100 crores, but because of the restriction imposed and the second wave starting in February itself, and we got reduced ourselves to INR73 crores, but we have ordered and this year we are planning to fund again around INR90 crores to INR100 crores in improving our infrastructure in internet ticketing; because the tenders which we could not do the previous year, we would be doing this year.

Manan Thakkar — ICICI Securities — Analyst

And ma’am for Railneer and other endeavors?

Rajni Hasija — Chairman & Managing Director

Railneer, have 14 — earlier we had 14 plant operation. Now we have — Una plant has also been made operational. Bhusawal is going to be completed very soon and Vijayawada is like — I think Vijayawada, NTPC with Simhadri and Bhusawal. Healthy commission in this financial year. And the other two plants in Kota and Bhubaneshwar will come up in the year 2022 and 2023.

Manan Thakkar — ICICI Securities — Analyst

These will be INR20 crores, INR25 crores kind of number, or much less?

Rajni Hasija — Chairman & Managing Director

They are lesser, because the 72 plant is with the 70 — there, we have given some capital support of INR8 crores in each plant. So you can see, INR8 crores — three, we have already given the support, because the machinery has been installed…

Manan Thakkar — ICICI Securities — Analyst

And three more, so 25?

Rajni Hasija — Chairman & Managing Director

’22, ’23 yes, I think only INR16 crores will be disbursed [Phonetic].

Manan Thakkar — ICICI Securities — Analyst

And then for the private routes as and when they come in, we were planning to, have the rates on our own books, because it was a better IRR, given 10 year depreciation, how does that work and what are we planning there?

Rajni Hasija — Chairman & Managing Director

It certainly works very nicely, provided we win a tender. And as of now, for running Tejas, we were given certain dispensation and certain handholding was done by Indian Railways. If they go for a private rake now, so one thing is getting them — first is getting them approved from RDS or other Railway Official Agencies will be a challenge for us, one. Secondly, CRF pension will also be a challenge for us. Thirdly, if I use those rates and railway loses revenue, then the dispensation given to me will be withdrawn. I think I have been able, might be able to make myself very clear sir, that we are — as of now, we are using the coaching stalk of Indian Railways. It will be a real challenge for IRCTC to run with the private stock as of now because it — but if we win a private train tender, then we’ll have to get a pension [Phonetic] — separate pension for those trains, then there shall not be a problem. That will be a different story. This is going to be a different story. Yes, your point is well taken, that running by with a private stock may be cheaper option as compared to Tejas.

Manan Thakkar — ICICI Securities — Analyst

Ma’am, as of now, we have no such plans and nothing budgeted for that endeavor, right?

Rajni Hasija — Chairman & Managing Director

Private train, may what we have to spend this year is, first of all, winning the tender, we have to plan VG, etc, but we have already provisioned around the INR60 crore etc, we have reserved. Then in case, if spent, then we are also looking for equity participation from our partners. 60%, 50% you would be doing — that we would be doing. So you can say we have made a internal provision of around INR400 crores, and sales wise year-by-year. In any case, if we win tenders say by September or October or so, two year time period is still there to start the operation. So the planning will be done by getting the best rates, because SPV will be there, they will be tendering it out, and the best rate of the rolling stock provider will be taken, and then the provisioning will be made in the next financial year.

Manan Thakkar — ICICI Securities — Analyst

Thank you so much. Ma’am. My last question, who will be these typical partners that we would have?

Rajni Hasija — Chairman & Managing Director

I cannot disclose as of now sir.

Manan Thakkar — ICICI Securities — Analyst

Okay. Ma’am. Thank you so much.

Rajni Hasija — Chairman & Managing Director

Yet to win a tender.

Operator

Thank you. The next question is from the line of Mayank Babla from Dalal and Broacha. Please go ahead.

Mayank Babla — Dalal and Broacha — Analyst

Thank you for taking my question. Congratulations on a good set of numbers, ma’am and sir. Ma’am, you have given us the number for FY ’21 in non-convenience, could you give the same for the quarter, the non-convenience income? And same…

Operator

Hello, sir. This is the operator, what’s your company name? Hello? Sir, what’s your company name, sir? Hello?

Rajni Hasija — Chairman & Managing Director

Convenience fee was around INR150 crores quarter four. So just wait for a while. I am sorry, I don’t have these figures readily available with me, you give me some time, I’ll get you.

Mayank Babla — Dalal and Broacha — Analyst

Sure ma’am. And then just one more if I could squeeze in, the Railneer capacity as of date?

Rajni Hasija — Chairman & Managing Director

Railneer capacity, earlier with 14 plants, we had 14.08 lakhs per day. With the new plants coming up this financial year, four plants are added. So it will be around 16 lakhs per day. But the demand, if the COVID continues, then the demand will be less. So the production level may be not be there. So capacity utilization of the plant may not be on the top-notch. The COVID is actually affecting our business, catering and you know Railneer is an extended catering.

Mayank Babla — Dalal and Broacha — Analyst

Right, right. Okay. Ma’am, I’ll just wait for the number of tickets whenever in the Q4. whenever you get the number.

Rajni Hasija — Chairman & Managing Director

You can note it down sir.

Mayank Babla — Dalal and Broacha — Analyst

Okay.

Rajni Hasija — Chairman & Managing Director

So in the month of January, we had around 281 lakhs and in February 298 lakhs, and in March it is 319 lakhs. So you can now combine three to five. Around 8989 something.

Mayank Babla — Dalal and Broacha — Analyst

Sure ma’am. I will do the reverse calculation. Thank you, ma’am. Thank you and good luck for the next year.

Rajni Hasija — Chairman & Managing Director

Thank you.

Operator

Thank you. The next question is from the line of Niket Shah from Motilal Oswal Mutual Fund. Please go ahead.

Niket Shah — Motilal Oswal Mutual Fund — Analyst

Yeah, thanks for the opportunity. Ma’am, just one question, wanted to understand what will be the peak revenues given the fact that then we go back to pre-COVID levels and adding the new trains which will also come on board. If you just take that into consideration plus the 2S benefit, what can be the peak revenue that we can generate? Because it’s very difficult to bisect and dissect COVID period, because the trains will — there are multiple trains starting up at a higher point, and then it kind of shuts off and again starts off, so very difficult to bisect and dissect that. So would it be possible for you to give us some sense of what can be the peak revenues and once you assume — assuming everything goes back to normal?

Rajni Hasija — Chairman & Managing Director

Assuming everything goes to normal will not be that — hope everything goes to normal fast. Till that time, we personally feel because we are in the hospitality sector, we are the worst affected. And tourism rebound may not happen, because still the restrictions are there. And…

Niket Shah — Motilal Oswal Mutual Fund — Analyst

That’s fine. I am just trying to understand on the transactional ticket part of it ma’am.

Rajni Hasija — Chairman & Managing Director

Only the ticketing part you said?

Niket Shah — Motilal Oswal Mutual Fund — Analyst

Yeah, yeah.

Rajni Hasija — Chairman & Managing Director

Ticketing will grow, the way it is growing.

Niket Shah — Motilal Oswal Mutual Fund — Analyst

No, what can be the peak revenues for that what ma’am. Or if you can just tell me, how many will be the peak ticket…

Rajni Hasija — Chairman & Managing Director

Peak ticket volume? We have already achieved 80%.

Niket Shah — Motilal Oswal Mutual Fund — Analyst

No, no, no, Ma’am my question was, assuming all the trains go back to full utilization, the way it was earlier in pre-COVID levels, what can be the peak revenues or peak ticket sales, whichever number you want to give it? Because also it will include 2S right?

Rajni Hasija — Chairman & Managing Director

Last year, our total revenue from Internet ticketing segment was around INR619 crores, right? Out of which 58% was from the convenience fees. So that was around INR349 crores. So you can say if we go back to previous volume, and then we would be around — we would be around INR360 crores to INR400 crores from the convenience fees. And this was — sorry, sorry, sorry, you can say INR349 crores, was just we started in September ’19, so you can take the average for the month and then multiply by that number.

Niket Shah — Motilal Oswal Mutual Fund — Analyst

Okay. Got it. Okay ma’am. I will come back in the queue. Thank you.

Operator

Thank you. The next question is from the line of Dhruva Mukherjee from Malabar Investments. Please go ahead.

Dhruva Mukherjee — Malabar Investments — Analyst

Hello ma’am. Good afternoon.

Rajni Hasija — Chairman & Managing Director

A very good afternoon.

Dhruva Mukherjee — Malabar Investments — Analyst

So ma’am, has the share of bookings coming from our B2C partners gone up over time? And how high do you see it going?

Rajni Hasija — Chairman & Managing Director

Well, we can’t share the exact figure with you. The bookings with our B2C partners are really doing very, very well. So I can say that, let me — our B2C partner bookings earlier were around 14%, now they are around 17% bookings are happening to our B2C partner as a normal user. They have the revenue, you know, we have additional revenue also.

Dhruva Mukherjee — Malabar Investments — Analyst

Exactly and, do we mind it going as high as possible? I mean how do you feel about transforming from a B2C company to B2B?

Rajni Hasija — Chairman & Managing Director

Why I should I stop, tell me one reason? If I’m getting INR1 per ticket revenue, why should I stop them?

Dhruva Mukherjee — Malabar Investments — Analyst

No, no, no reason to stop, but do we want to remain the first place that the customer goes to book…

Rajni Hasija — Chairman & Managing Director

Actually, you have to be — like we have a various kind of our booking pattern. We have a B2B partner. We have an e-governance team also. We have B2B partners also. Then we have our normal user booking also. So we have provided multiple cases. So it really is going to be survival of the fittest. But whosoever is going to present the booking in the fastest manner and the nicest manner, and give the facility to the customer, so he will drive away the business. And for me, the [Speech Overlap] going to be mine, so I’m going to be benefited by more of B2C partners as compared to B2B. But still B2B is a gainer for me, because still I get the convenience fees.

Niket Shah — Motilal Oswal Mutual Fund — Analyst

Yeah, yeah. And currently, what share of bookings would be coming from offline agents?

Rajni Hasija — Chairman & Managing Director

Offline agent now is going — as it is around — these are generally I think — offline, is we have only in the internet [Indecipherable]. They are around to the tune of 3% only. Then you have a government B2B business, there, you have many facilitation centers of the state government, where there, the booking is not even 1%. Then you have — in the — most of the bookings are happening online only, even in the government sector also, where the forces that we have tied up, they are online. Offline, we don’t do. But railways, their do is around 20% — still they are doing 20%, because 80% is online.

Niket Shah — Motilal Oswal Mutual Fund — Analyst

Okay. Okay. So people getting agent [Indecipherable] of IRCTC, and booking is [Technical Issues].

Rajni Hasija — Chairman & Managing Director

So from 72%, the journey has been up to 80%. Maybe next year when we talk, we have traveled for this.

Niket Shah — Motilal Oswal Mutual Fund — Analyst

Yeah. Yeah. Okay. Ma’am/ Thanks a lot.

Operator

Thank you. The next question is from the line of Ashish Agarwal from Principal India. Please go ahead.

Ashish Agarwal — Principal India — Analyst

Yeah. My questions have been answered. Thanks a lot.

Rajni Hasija — Chairman & Managing Director

Can I answer the questions that how many trains are running as of now on Indian Railways? So it is around 1,500 trains are running. I think — hello. Many of you had asked. I think Urmil had asked, and after Urmil, some Dolat Capital had asked someone. Someone had asked how many trains are running on the Indian Railways setup, where the bookings are happening there, on 1,500 mails existing. And suburban services are also there, passenger trains are also there, but they are in the unreserved segment. That is happening mainly in the wester region.

Operator

Thank you. Due to the time constraint. This was the last question for today. I would now like to hand the conference over to IRCTC management for closing comments.

Rajni Hasija — Chairman & Managing Director

Thank you very much all of you. It has been a really brainstorming session. The year has been very difficult, and initially we were not doing very well in the first quarter, because IRCTC had shown loss in the first quarter. But gradually we improved in the second quarter, then third quarter, we improved further. And in the last quarter, we moved further. And put together, I think we have been able to bestow your confidence upon us and declared a dividend of around 50%, INR5 at the face value of INR10, and after this pandemic also, rather the pandemic is still continuing.

As I have been mentioning every time, that the hospitality sector has been worse affected, and the tourism is going to take some time to take off, especially the inbound tourism, because many of the air traffic restrictions are still not open. So, for few [Phonetic] traffic will take some time to cope up with this changing environment. Secondly, the catering pattern is also chasing, the segmental profit is also changing, the pandemic has affected each and every corner of our eating habits also. The market, though will decide who lives in this market for long, but we hope that these things will change and by saying so, I wish you all the best, everyone for the coming year, and stay safe, stay healthy, may the COVID not take over you, and you should all stay healthy and fit. Thank you very much investors. Thank you guys once again. A very good afternoon.

Operator

Thank you on behalf of ICICI Securities Ltd. That concludes this conference.

[Operator Closing Remarks].