Le Travenues Technology Limited (NSE: IXIGO) Q1 2026 Earnings Call dated Jul. 16, 2025
Corporate Participants:
Unidentified Speaker
Aloke Bajpai — Chairman, Managing Director and Group Chief Executive Officer
Saurabh Devendra Singh — Group Chief Financial Officer
Rajnish Kumar — Director and Group Chief Technology Officer
Analysts:
Unidentified Participant
Anmol Garg — Analyst
Swapnil Potdukhe — Analyst
Rohit Thorat — Analyst
Lakshminarayanan KG — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the late revenues technology Q1 FY26 earnings call hosted by DAM Capital Advisors Ltd. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing start then zero on your touchstone phone. I now hand the conference over to Mr. Anmol Garg from Dam Capital Advisors Ltd. Thank you. Not sir. Thank you, Zico.
Anmol Garg — Analyst
Good evening everyone. On behalf of Dan Capital, I welcome. You all to ICSIGO’s 1QFY26 earnings call. We have with us Mr. Alok Pashpal, Chairman, MD, Group CEO of the company, Mr. Rajneesh Kumar, Director and the Group Co CEO of the company and Mr. Saurabh Devindra Singh, Group CFO of the company. Before I hand over the call to Saurabh, I would like to highlight the safe harbor statement on the second slide. Of the earnings presentation and it is. Assumed to be read and understood. Thank you. And over to you.
Aloke Bajpai — Chairman, Managing Director and Group Chief Executive Officer
Okay. Hello everyone, this is Alok here. Welcome to our Q1 FY26 earnings call. We have kicked off FY26 with a. Fantastic quarter for the Ixigo Group. We’ve managed to beat our own expectations and continue to grow at a strong pace. Despite this quarter having its share of challenges for the broader market. Q1 FY26 had a few events that impacted the aviation market in India and the region. Operation Sindhu led to a temporary airspace closure across parts of North India in May, affecting flight operations for nearly 810 days. While this was a significant disruption during the period, the post event recovery has been swift and the ecosystem has adopted quickly. The tragic AI171 crash in June created another setback due to the dent in morale and passenger confidence in the immediate aftermath.
In addition to this, the airspace closure in Pakistan as well as the airspace disruptions in the Middle east during the Iran Israel situation led to some dampening of international flight growth in the interim, Air India also voluntarily cut 15% of its international widebody flights till mid July to accommodate enhanced safety inspections. And then the Middle east airspace closures affected many carriers as well towards the end of the quarter. While all this is normalizing, we believe that quarters like these which have some headwinds, give us an opportunity to test our customer oriented mindset. In Q1FY26, our team saw spikes in customer reach out for reschedules, cancellations and alternate arrangements with the help of our AI, augmented customer support and newly launched voice AI capabilities.
We got the ability to go above and beyond for our customers and we were able to demonstrate more agility and responsiveness in these situations, helping us to continue to gain market share. Penetration of air travel in India is still in its early innings compared to global benchmarks and we see headroom for growth, particularly from regional airports and underserved segments. Just over 4% of Indians travel on flights compared to 37% plus in China and 85% plus in the US and once the GDP per capita crosses the $400 mark in India, we expect discretionary to flow further into flight and hotel categories.
India’s airport infrastructure is also undergoing a transformative expansion, with the number of operational airports doubling from 74 in 2014 to over 160 in 2025. The government is targeting 200 airports by next year and 240 airports by 2030 through a 92,000 crores investment push. The regional connectivity boom, backed by 60,000 crores in private terminal upgrades, unlocks massive demand from tier 23 cities where ixigo already has a very deep market penetration. Our multimodal capabilities and personalized offerings position us perfectly to serve and scale with this next wave of Indian air travelers. On our bus business, we have strategically been prioritizing growth over near term margin optimization for a few quarters now we have.
Given the sheer size of the opportunity in front of us, that philosophy remains unchanged. Bus travel in India is also undergoing an inflection point. Despite the segment scale, only 20% of bus bookings happen online, leaving vast room for digital expansion. Simultaneously, most buses run at 60 to 70% capacity, while trains and flights on parallel routes are frequently waitlisted or overbooked. This supply demand mismatch, coupled with rising expectations around travel comfort and flexibility presents a massive opportunity. Private operators already upgrading their fleets and bus travel is now happening on clean modern buses and is being marketed as a preferred mode of transportation for Gen Z travelers.
This growth is being further accelerated by the massive expansion of India’s road infrastructure. We’ve been expanding our geographic footprint. Abibas, which initially had strongholds in south and West India, now has a growing presence in the north and east as well, and our partnership, spanning both private fleet operators and SRTCs across the country, have continued to grow. These relationships are foundational to our ability to scale efficiently. In fact, our bus partners are working more closely with us than ever before to identify ways in which we can help their business not just grow, but also market their new routes.
Bus amenities and improve passenger experience. This quarter we’ve made significant strides in cross selling buses and flights both across our ecosystem on Ixigo Confirmed Ticket and Abibas apps and websites thanks to proprietary tech enhancements and products such as Travel Guarantee which offer customers flexible multimodal alternatives capturing spillover demand from waitlisted customers. Our biggest achievement has been our ability to maintain leadership in the OTA category in terms of user base, not by outspending competition but by continuing to see a lot of organic product led growth as well as word of mouth about the overall customer experience we’ve built leading to market share gains on all three lines of business that we operate in.
On the trains front our market share has now crossed 60% up from 58% two quarters ago. We have recently seen some minor volatility due to a seasonal of passenger oriented policy changes introduced by Indian Railways. However, our trains business remains resilient and our user experience has continued to improve and that is reflected in our rising App Store ratings as well as our growth. I’m pleased to report that now we operate India’s highest rated travel apps by far. Confirm Ticket and Abibas have both got 4.8 plus rating on the Google Play Store, Exigo flights has crossed 4.7 and Exigo trains app is 4.6 plus and we have a staggering 50 plus lakh user ratings 5 million plus ratings on the store across these apps reflecting our scale.
For the first decade of our existence our entire growth story was organic and we spent almost nothing on brand and performance marketing. It was only in 2023 that we began making deliberate long term investments in brand. Once we gained more confidence on the superiority of our product and customer experience. We recognize that top of Mind Recall, brand affinity and trust at scale not only serve as a long term moat but but also materially improve conversion rates and the effectiveness of our performance marketing channels. Once product led, growth has established a strong base of early adopters.
This quarter we ramped up brand spend in line with growth and ran a major Exigo anniversary sale and flash sales for flight and hotels in which we leveraged AI into our marketing workflows. Our AI video production cost is 0.1% of what it would be with traditional campaign production. On the train side, we’ve entered into various brand partnerships, most notably with Rohit Sharma for ICSIGO Trains which helped drive awareness and adoption of our travel guarantee feature and improved top of mind Recall, particularly North India. On the bus side, Abibak partnered with Chennai Super Kings and the Tamil Nadu Premier League while confirmed ticket collaborated with the Royal Challengers Bengaluru team.
The RCB Partnership gave us nationwide visibility, especially during the iconic 18th year title win, an emotional high recall moment that coincided with ixigo’s 18th anniversary. These campaigns were not just about visibility, they were about building deep user trust and emotional resonance across markets. Our line of business owners may choose to prioritize between performance marketing discounts or brand building initiatives based on when and where they see most value for these throughout the year and we focus on measurable outcomes such as the baseline shift, the stickiness and repeat behavior of the incremental traffic, as well as lifting conversion rates across organic and performance channels.
Since this is a multi year exercise, some of these efforts may not show material impact immediately, but early results indicate these initiatives are working for us and we’ll continue to do them within specified guardrails. Our strategy of building for Bharat, staying asset light and creating deep user trust over years is what has led to the kind of growth we have seen. At EXIGO over the last few years. The gross transaction value CAGRADE of 83.7%. Over the last six years or EBITDA. CAGR of 84.3% since we turned profitable in FY21 are a reflection of what execution DNA we’ve built over time. Over the next few years I believe that we can continue to grow significantly faster than the market in hotels, buses and flights and in line with the online market growth in train with multiple optionalities for new latch on additions such as what we did with food delivery on the train. Business travel is an inherently unpredictable experience due to constantly changing prices, availability, terms and conditions, fine prints and all. At Exilo, we believe it’s not just our responsibility but our duty to offer not just tickets but peace of mind to our users.
Our unique peace of mind stack of value added services allows us to reduce anxiety, protect downside and increase predictability for our customers and our ability to use AI to price and personalize all these products has been accretive to our growth and margins. We are now able to use a large user base and trust build over years to move up the value chain and grow faster in new categories such. As flights and hotels. Very few companies have been built this way in India since most choose to focus on the top 50 million consumers only. But since the proverbial pyramid will now become a diamond as mini Class India growth or I should say Bharat ambitions and wallets continue to expand, consumer discretionary categories will continue to see disproportionate growth. Travel continues to be in the top three things people want to spend on to improve their lifestyle and when you look at buses, budget hotels, tours, etc. Online penetration is only getting started. Finally, I’d like to point out that our business has a seasonal cadence.
Q1 and Q3 tend to be strong quarters due to vacations and major festivals. Q2 is historically a leaner period, while Q4 sees regional surges, particularly in South India, driven by festivals like Tonga, Lugadi and the regional New Year celebrations. Despite the seasonality, we remain well positioned to sustain yoy growth faster than the overall market in the near to midterm.
With that, I’ll hand over to Rajneesh who will talk about something we have been talking about for many, many years that people have recently started paying more attention to, which is AI and our reinvention to an agentic organization. Over to you Raj.
Rajnish Kumar — Director and Group Chief Technology Officer
Thanks Anuk. So Anok talked about why we are. Growing the way we are, but I believe this growth is a privilege that has to be earned and re earned every single quarter. Our conviction comes from a clear understanding of what drives our differentiation, which is the ability to identify, design and deliver tech led innovations that power what we call our peace of mind product stack features that reduce anxiety, improve reliability and simplify complex travel decisions. Slick focus has enabled us to acquire and retain customers cost efficiently even in competitive markets. Whether it’s delay predictions, intelligent fare logs or multimodal routing, we are just optimizing bookings.
We are elevating the experience of travel. That’s what fuels our continued momentum at Ixigo. Our journey with Agentic AI started as early as 2017 when we introduced our travel assistant and recommendation agent known as Tara. Today, an award winning multimodal agentic travel assistant, Stara was way ahead of its time. It was autonomous, preemptive, multimodal with voice and app based and hyper personalized. It could understand a user’s past travel patterns, preferences, royalty programs, everything else to make intelligent travel decisions. Showcasing our early belief in the power of agentic systems to transform the travel experience. Fast forward to today. Agentic AI is now deeply embedded across our business enhancing efficiency, personalization and autonomy at scale. From real time fare trackers and price prediction agents to autonomous web checking agents that deliver your boarding pass straight to your Apple or Google Wallet. Much of what a user experiences on Exigo today is already powered by invisible agents working behind the scenes interacting with complex third party interfaces to get your job done efficiently and preemptively. Internally, we are driving significant productivity gains through our project Trishul. Our C pronged AI first infrastructure strategy centered around efficiency, revenue and disruption. Automated testing, intelligent code generation, smart deployments, rollbacks and ML driven pricing models for products such as Pricelog and Assured all run on self governing agentic pipelines.
Teams across hr, finance and marketing use DIY agentic tools to automate workflows, generate content or even deploy voice agents that in all customers or partners autonomously. One of the most powerful applications of Agent DI at Exigo is in voice agents. Today, more than 60% of our customer support voice interactions are handled end to end by fully autonomous AI agents. These voice agents don’t just respond, they proactively call customers to deliver critical travel updates, collect NPS scores or feedback, and even follow up with business partners on behalf of our users or internal teams. This is saving time, improving service levels and proactive customer care at scale.
Democratization of agentic AI across the organization is a key part of our strategy as well. Anyone at ICSIGO can build, test and deploy autonomous workflows without needing an engineering background and without having to write a single line, of course. As for the future, we believe travel apps will evolve into conversational, multimodal and hyper personalized autonomous agents. Not just recommending but doing for you. From booking your trip at the optimal time to reserving your favorite at a restaurant on arrival. Future travel assistants will act not just advice and to power this they’ll need real time inventory, context of your decision systems and value added services, all of which Xegret’s uniquely positioned to provide.
A lot of people ask me what. Percentage of our code is now AI generated? And I think the commonly coded metric X percent of our code is now AI generated is fundamentally flawed if we’re trying to really measure the real impact of AI and software engineering. And the reason is simple. Coding itself is not the main bottleneck in software development. In most real world engineering workflows, writing code barely accounts about 20 to 30% of a developer’s time. The remaining 70 80% is spent on far more cognitively intensive and collaborative tasks like system design, architectural planning, writing detailed documentation, thinking through edge cases, defining interfaces, creating test strategies, setting up CI CD pipelines, et cetera.
In that context, even an AI assistant can generate 80% of your code that still just a productivity boost on a small slice of the overall effort. And mathematically it amounts to only about 15 to 20% efficiency gain at best. And that’s assuming a near perfect AI generated code, which often still requires a lot of preview, debugging, refactoring, et cetera. So more of a code Generation has been getting incrementally easier over years. Whether it’s by autocomplete in the early version of Copilot or you know, people just copy pasting stuff from Stack Overflow. But more recently with tools like Copilot or Cursor, et cetera, those things have evolved a lot.
So while these are impressive evolutions in productivity, they are at best evolutionary, not revolutionary. Where AI is now playing a role in tackling the upstream and downstream parts of the software development life cycle. From exploring trade offs to helping with design and architecture decisions, generating documentation, writing test cases, creating mocks or deployment scripts, and managing infrast code, or handling observability and rollback logics for self healing failures. This is where agent AI becomes specially powerful. Not just passively generating code when prompted, but proactively owning parts of the entire software engineering process. So rather than asking what percent of our code is AI generated? A better question would be what percentage of the end to end engineering process is now autonomously handled or significantly accelerated by AI? And for us, that number currently would be north of about 40%.
When it comes to leveraging emerging AI models and tools, we have taken a forward leaning experimental approach both to enhance internal efficiencies and to power new customer facing experiences. We recognize that we are still in the early innings of what is effectively a new industrial revolution. The AI landscape is evolving at breakneck speed, with no single model, platform or framework having yet emerged as a clear long term winner for deep scale investment. In such a dynamic environment, we believe it’s critical to stay agile and continue investing in cutting edge technologies and capabilities. These technology expenditures may not immediately translate into operating leverage in the short term, but when one of these bets pays off and a particular use case matures and can be deployed at scale, it unlocks significant operating leverage and competitive advantage.
Our philosophy is to stay ahead of the curve, absorb the learning costs today, front load it and build a defensible mode that compounds over time through proprietary AI driven efficiencies and user delight. The other question I get asked frequently is whether agentic AI will disrupt OPA businesses. Agentic AI may pose risk for those who don’t adapt, but for us it’s a once in a decade opportunity to use it to leapfrog. We’re not only ready for this shift, we’ve been building towards it for years. If you want to measure how good a company is at AI adoption for accelerating growth and efficiency, the mesh measures would be to look at the revenue per employee.
For us last quarter we have crossed rupees 2.2 crore annualized revenue per employee in Q1 or roughly 256,000 USD, which even on global benchmark is pretty decent. We believe this is just a start. In FY25 we managed to grow our revenue nearly 40% while growing our employee base by less than 10% in spite of adding newer business lines like hotels, food on trains, et cetera, which would require a couple of years to scale. This is only possible if the mindset inside the team is to use technology and AI instead of just hiring more people. And with that I’ll not bore you. Further and pass it to my friend who has a unique knack of being good with both numbers and people. Sourabhat Devindra Singh
Saurabh Devendra Singh — Group Chief Financial Officer
Thanks Rajneesh. And you are not even close to being boring. In fact I have to tell the larger forum I feed on Rajesh discussions on AI. In fact I regularly get inspired by them A few days after our last quarterly call. Inspired by Rajneesh and the work he’s doing on AI, I fed all our past presentations financials for six years annual report VRHP conference call into an artificial intelligence model that I’ve been using a lot recently just to see what it comes up with. I requested AI model to give me a hopeful best case prediction for this quarter.
The model came out with three outcomes. Outcomes that I back then classified as highly optimistic. One exigo would build on its momentum, gain OTA market share across every segment we operate in two ICIGO would kick off FY26 with record revenue and more notably record profit and 3i, Saurabh Devendra Singh would finally stop saying after every a couple of words and lose the fumble or the retroflex. And duh. That heavily defined my conference call accent. I’m happy to report that AI got two of the three right. Okay, jokes apart, let’s walk through the highlight of Q1 FY26. As always, all the figures are in rupees crore unless specified otherwise.
Year over year comparisons are made for Q1FY26 against Q1FY25. Starting with the headline numbers, our Gross Transaction Value GTV reached 4644.7 marking a 55% increase over Rupees 2988.1 crore that we saw in Q1 last year. Revenue from operations stood at 314.5 crores, up 73% from 181.9 crore in Q1FY25 Contribution margin grew to 128.1 crore marking a strong 48% year over year increase. Contribution margin percentage stood at 40.73 versus 47.74 in the prior year. The decrease in percentage was as per plan and as Alok talked about, driven by our focused investments in driving growth and strong performance of cross sell products like Travel Guarantee.
We’ve talked a lot about this in the previous FAQ in case somebody wants to Adjusted EBITDA excluding other income and ESOP. Cost improved to 31.4 crore compared to 20.3 crore last year and increase of 54% profit after tax came in at 18.9 crore compared to 14.9 crore in Q1FY25. There are some one off call outs in this number which I will discuss in the end. Turning now to our individual business line for flights, this was a challenging quarter with several unfavorable developments in the macro environment which Alok alluded to in his talk. Despite these headwinds, the flight team has risen to the occasion staying focused on delivering peace of mind to our customers.
Our suite of value added products have played a key role in maintaining the strong performance and building customer trust during these trends. The numbers reflected that we booked 2.79 million flight segments with GPV rising to 1848 crore contribution margin grew to 43 crore representing a 42% contribution margin percentage. Flight accounted for 33.5 of group’s total contribution margin this quarter. Our bus business operates out of Hyderabad and like the city itself is a seamless blend of the traditional and the modern. The business pairs deep rooted empathy for customers and operators with cutting edge technology to drive efficiency and scale.
Fittingly, the results this quarter were equally balanced, calm, steady and right on plan. This quarter we completed 6.67 million passenger segment bookings marking a 74% year over year increase. GTV rose 81% to 681 crore. Contribution margin for the category grew 44% to 42.3 crore with a contribution margin percentage of 55%. A planned tapering consistent with what we Talked about in Q1FY25 conference call base contributed 33% of group overall contribution margin in Q1FY26. The pace of growth of Trane’s business continues to surprise me personally. We have a dominant position in this business line and in that context the fact that this business continues to grow significantly faster than in the Trane OTM market is extraordinary.
In Q1FY26 we booked 26.6 million train segments marking an impressive 26% YoY growth. GTB stood at 2055, a 30% rise, revenue from operations was 129.9 crore up 29% and contribution margin came in at 41 crores up 14% and at a 32% contribution margin, the train segment contributed 32% to the overall contribution margin. The group contribution margin. Now as promised, let me discuss the one off items and the call out. Now in Q1FY26, the share of loss from Freshbus, which is an associate company was 2.34 crore. For Q1FY25, there was a revaluation gain of 5.77 crore on Freshwater, share of loss from Freshwater of 2.01 crore and IPO expenses of 2 crore charged to the P and L.
Now if I was to compare on a like to like basis by excluding all these items in both periods, our profit before tax would have increased by 76.2% from 15.2 crore to 28.7 crore. So what do I expect from the rest of FY26 and beyond? To answer that, we’ll have to start with the reality of what we are stepping into. Artificial intelligence isn’t just another trend. It’s a seismic shift on par with the invention of wheel printing press or maybe even greater. It’s already reshaping how we think, build and adapt. And in moments like these, I’m reminded of a line often misattributed to Charles Darwin, but actually written by Leon c. Megilson in 1963 when he reinterpreted Darwin’s ideas for the business world. It is not the most intellectual of. The species that survives. It is not the strongest that survives. But the species that survives is the one that is best able to adapt and adjust to the changing environment which it finds itself. That insight has never felt more relevant. And as Alok and Rajneesh have talked about, we are ready. There will be quarters like this one, full of energy, growth and the thrill of getting things right. And then there will be quarters that humble us when we reflect, recalibrate and learn. But through both, our compass will remain steady empathy, honesty and adaptability. With that, I’ll hand it back to the moderator for questions.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the Touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use answers while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Our first question Comes from the line of Anmol Garg from DAM Capital. Please go ahead.
Anmol Garg
Hey guys, thanks for the opportunity and congratulations on very very strong performance. Just a few questions. Firstly wanted to understand what led to a sharp increase in the take rates. In the flight business in this quarter. We have now reached to almost at. 9% kind of take rate and is. This kind of is this sustainable going ahead?
Saurabh Devendra Singh
So yes, there are a couple of things. So one is the underlying ticket price has gone down, it’s a fixed business. The second, as I said we have what we call a peace of mind or value added services product and I’ve talked about how some of them have done well. It’s a combination of these which are leading you to feel as though the take rate is higher. But remember a large part of what we have in the take rate as a percentage is a fixed amount. And thirdly you also realize that in flight what has led to some of the things is also the fact that we’ve run promotions.
So look I’m on a if you see us compared to others and this I’ve mentioned multiple times before, we look slightly different because we are more domestic and domestic it’s underlying amount, it’s a lower ticket item, it’s our geographical shifts are different. So on the take rate, going back to your original answer on a take rate percentage, we don’t look at it that way as a take rate percentage because I don’t control the price of the tickets, I control what I take as commission. But what we take as commission and what our attach rate for our products should be, we remain confident on that.
Anmol Garg
Understood, understood. And secondly wanted to understand that while our bus segment is growing at a very fast rate, however if I look at the contribution margin here on a. Buy and buy basis it means that. It has dropped almost 20 percentage point. Now is this because of one time. IPL advertisement that we have done in. This quarter or do you think that. This is the range that it will be going ahead as well? And from that perspective overall margins for the company, should we expect the leverage to come in the overall margins or the focus currently will be on the growth side?
Saurabh Devendra Singh
So let me break the question down in a couple of parts. The easiest part out of these is that whenever we are doing branding that will come below because we see branding as more long term. And I think Alok has talked about what the IPL in boxes that we’ve done, why we’ve kind of done it for the Tamil Nadu market which is where we’ve been focused on look A year ago we talked about we were at mid-70s as a contribution margin and we talked about that. We see this as a very low penetration market. We believe it can grow.
And when I look at the numbers right now, I know that looking at the contribution margin percentage is important in a lot cases. But for me the growth of 44% in the actual absolute contribution margin is very important, especially in an industry or in a sector where it’s under penetrated. It’s very under penetrated. So we have been focusing on that. Is it something where we feel that this is a number that if we continue growing like we are, would we be comfortable with this kind of cm? Yes, we would be. But I would say it on both sides that, and I’ve said it multiple times before, I don’t believe that you’ll see all quarters being 81% growth in buses.
It will be as in I think we’re doing well, I hope we continue doing as well. But we’ll keep a lookout here in that sense. And in terms of what we have above cm, it’s a very controlled expense. We can manage it because it’s on a per unit basis. It’s much easier to manage.
Aloke Bajpai
Also. The brand expenditure is not knocked up from cm, it’s actually below. Right. So I don’t think brand plays a role here. It’s largely discounting performance and variable cost that is knocked off from the CM. Side in that sense.
Anmol Garg
Understood, understood. And so should we expect that for the full year basis we will see some kind of operating leverage benefit to the company?
Aloke Bajpai
See, operating leverage on the fixed cost level is already visible. It’s just that we are reinvesting that into multiple areas. Right. So if you think about new initiatives like hotels or some of the AI. Initiatives was talking about, or also things. Like food delivery on trains and things, those are areas where as a company we are pushing the pedal on saying, okay, how do we capture the market opportunity, how do we build out? So despite those investments, etc. We are essentially seeing this kind of operating leverage play out. So had we not been making those new initiative investments, the operating leverage would be more visible in the bottom line. But we choose to do that because we want to continue to grow fast and seize on those opportunities. Right. So that’s what Sourabh was alluding to now.
Saurabh Devendra Singh
And the other part which you said, look this quarter and I’ve said that multiple number of times and I stay with that, you have to realize the branding is bunched up together so you won’t see what you’re Seeing is the branding cost right now, the amount that we are putting that’s on branding, which is below CM and above ebitda, that will kind of spread across the year. This quarter was a heavy branding quarter because of IPL being there. So as a little kind of balance out.
Anmol Garg
Understood, Understood, sure. Thanks guys for answering my question. I’ll get back in the queue.
Saurabh Devendra Singh
Yeah, just one more thing that I. Wanted to add that there are new. Business lines which are very far, far away from reaching operating leverage. In fact, they are in bid out phase and they are like a bigger cost center than all of the other businesses. So you might not completely see that operating leverage. There’s some absorption of that happening because of these new lines of businesses like hotels and you know, food on food, etc.
Anmol Garg
Thanks.
operator
Thank you. Our next question comes from the line of Swapnil Potdukhe, JM Financial. Please go ahead.
Swapnil Potdukhe
Hi guys. Thanks for the opportunity and congratulations on a very good setup number. Again, my first question is with respect to your travel guarantee feature. I would like to know what percentage of your flight business and the bus business in this particular quarter came from this feature that you have been running. What would be the contribution in GTV terms or howsoever you would like to explain?
Saurabh Devendra Singh
Swapnil, I would have loved to give you a lot of details, but we don’t declare that. So the answer would be we can’t. Tell you because we don’t declare factors.
Swapnil Potdukhe
But would it be fair to say.
Aloke Bajpai
Just to say something here. I mean, even if you look at. Just the fact that even when we hadn’t launched availability, we were able to grow at a certain velocity even 2/4 ago, I think we are starting off at a very low base of market penetration. When we started our flight business just. About four or five years back. Right. So in that sense I think there is still a very, very, very long Runway even outside of the additional delta that travel guarantee might be adding in. Terms of upsell, etc. So I think in the larger scheme. Of things, you know, it will, it. Will look like a smaller piece.
Swapnil Potdukhe
Okay.
Saurabh Devendra Singh
I would recommend this last quarter, if you go to our faq, we did a very detailed explanation of how we think of this product. So you can, you can just go through that part and you’ll get a lot of your answers on this product thematically.
Swapnil Potdukhe
Right? Right sir. But if I were to just produce a bit more, I mean, yes, you may not give me any numbers per se, but any sense as in incrementally, how much is that growth coming because of this feature? And, and also because of not just travel guarantee but also with your partnership with someone like a phone pay. Right. Which has been there for one year now almost. But because I’m just trying to triangulate things because your contribution margins have been pressure. So where is exactly growth coming from. And where are you. Contribution margin has come down a bit. Right. So is it because of some investments that you’re doing on the third party platforms, revenue sharing or those kind of things?
Saurabh Devendra Singh
So firstly Swapnil, as in I think me and you are slightly different on the definition. When I say contribution margin, it’s a rupees crore number. Contribution margin percentage is what you are.
Swapnil Potdukhe
Yeah, I’m looking at the percentage.
Saurabh Devendra Singh
So I’d like to kind of clarify that part. The second part is to realize look, contribution margin percentage is something you look at and when I look at and which is what I’m saying in each of these businesses when I introduce a new product and which is why I’m saying I’ve given that logic in a lot of detail in the last faq. When I introduce a new product, I can decide on what I want to optimize on. Am I optimizing it on margin or am I optimizing it on usage? Now, couple of things from our side is we don’t like having a loss making products sustainably for a very long time.
So when we look at it we say that firstly we are able to launch the product and why we can launch the product at probably a more optimized cost than anybody else is because of what Rajesh talked about in his section in the AI and products that he is launching. So when we launch a product we kind of take that call saying look in the initial parts of the product, I don’t want to get a crazily high margin, I want to make money on that because otherwise it doesn’t make sense to me. I’m an ota, that’s my idea. But I want it to be a win win between me, the customer and the supplier in cases where it might be. Which is why whenever you see a product initially and especially what we call the peace of mind stack product, we would optimize it for a lesser margin. Now as the product grows, we might choose to increase the margin if people find the utility and people are using it much more. The other part, for you to realize what you have asked on travel guarantee, remember travel guarantee, the person is say I have a train ticket, I take a travel guarantee, I buy a flight.
Essentially I’m still you should and you should use travel Guarantee if you travel on trains, you’ll realize the utility of the product if you have to have a time sensitive meeting event function where. You have to be there. In that case, what I’m doing is I’m giving you an incentivization to get into a new mode of transport in many cases. So when Alok Talked about the 4% penetration of flight and where it is growing. So I think if you want the real answer, you can check how many new flyers are coming in in India and I would argue that a significant percentage of those would be from us.
Aloke Bajpai
So last time we had given out. This metric that for the new flyers. That we are adding from our NBU. Apps, half of them were actually flying for the first time because we run. Surveys on that cohort and asked them. Whether it’s the first flight of their life. So I think the real win with products like Travel guarantee are that we are making flyers out of people who are not flying before. And in that sense we are growing the market, growing the aviation market and. Not necessarily eating into anybody’s market share.
Swapnil Potdukhe
Understood. That’s, that’s pretty clear. So another question on Applied business and this is a follow up to the previous question that was asked, you did mention three reasons for the take rates going up. One was your domestic pricing coming down, which is understandable. But you did mention that there were some anniversary sale and flat till promotions also with certain bank partners. How does that help your take rate? Do you.
Saurabh Devendra Singh
General flight business? So I wasn’t talking about take rate, I was giving you the two reasons which I said. One is the domestic peer to base. The second which I was giving was the fact that I have these products which are also included in the take rate. And the third which is the underlying ticket price because what I said if the ticket price, because mine is a fixed price, what I get if the underlying ticket price of applied changes or average price changes in our route, my take rate varies.
Swapnil Potdukhe
So just just to be clear, when you report gross revenue, you don’t include ad income there. You include that in the net revenue that you.
Saurabh Devendra Singh
So when you’re looking at gtv, they wouldn’t be any add income GTV into take rate would be ticketing revenue. Then you add other income which is ad and bank offers and then you get to take off the discount. You get to revenue from operations.
Rajnish Kumar
Revenue from operations growth. So whenever we run these kind of campaigns, you know, if you see any excess jump in the revenue from operations, some of it could be because of that. But on the gross ticket side Right. It’s basically the gross ticketing revenue that we consider.
Swapnil Potdukhe
Right. That answers that question. And just on your bus business, was there any tailwind on a, you know, when you look at it y oi basis? Because last year probably it was an election quarter. Right. And so the numbers could have been a bit depressed when you look at, from a YUI perspective and any incremental benefit. You had mentioned in the last quarter. Also that some of the traffic which was affected on the air side because of the situation in the north in Indian states during the bus business was likely to benefit from that. Some traffic shift.
Rajnish Kumar
Not really. See, the growth you’re seeing on the bus side is not just a 1/4 story. If you look at the last 3/4. Actually we’ve been growing pretty rapidly on the bus side. And again, there is no base effect here. I mean elections, you know, what happens is, yes, there could be some people who may choose not to travel during that, but then there are other people who will go back to vote in the city where their vote is. Right. So in some cases we’ve seen even. More travel on certain access as a result of the election. So I don’t think there is any kind of a base effect playing out here. You know, and the fact is that. Look, we are still, you know, like. Number two in this and there’s a long Runway for us to grow because the market is only 20% penetrated. So like Sourabh said, I think those are the reasons why we are not looking at whether the CM is 55% or 60%. That’s not material for us. Because as long as the absolute CM is growing at this kind of velocity, they will naturally be operating leverage flowing in because our fixed costs are not growing at that kind of base of contribution margin growth. Right.
Saurabh Devendra Singh
But on Vasna, you should see the product which we have right now, what has happened over the past one year is we have really improved the product. And again, maybe Rajesh can talk a bit more about what we’ve done there. But it’s a product that has really improved. Yeah, I mean like a lot of.
Rajnish Kumar
Yeah, I mean like a lot of changes that we have done in the. Product recently, including the introduction of the new edge platform, utility features like Bus Insights, et cetera, which is giving passengers a really deep insight into and otherwise a really fragmented inventory business side, and you’re actually traveling with bus, you really arrive. And I think Bus Insights is giving you this peek into the quality of the fleet. And with filters, like brand new bus filters, et cetera, all of this has boosted a lot of trust and conversion rate in bookings and I think some of these things are kind of feeding into positive customer service, getting us to 4.8 rating and the conversion rates etc.
All of these things are kind of impacting our conversion rates and creating a virtuous cycle of quality and demand where you’re able to kind of capitalize on this and grow purely like with a product like source of switch and then amplifying that with performance bands which are optimized.
Swapnil Potdukhe
Just one thing on train as well some comments because there were some changes by IRCTC recently and I think Saurabh also had touched upon briefly on this point. Any impact of those changes if you can just clarify or give some color on that.
Aloke Bajpai
Yes. So I think look there were broadly. Three types of changes that happened there just so you know. I mean one was there was a. Change in the supply timings which reverted back to 30 minute delay from 10 minutes that it had earlier been reduced to. And while we are still in discussion to understand, you know what the impact and why, I think there is, it’s just too early to quantify the impact of that. We did see some volatility as a. Result of that but of course since. We are also growing quarter on quarter. Month on month so you know it’s. Harder to break out how much of. That is resulting from the change. In particular Aadhaar linking is the other thing where on Tatkaal tickets you need to link your Aadhaar and there is. An OTP that will come Aadhaar OTP that needs to be filled in. And while this is now rolled out and it’s just the first couple of. Days that this change has been implemented. So it’s very early and we haven’t. Really seen a material impact as a result of that. But there is slight impact I would say. And in terms of the third change which was chart preparation being done eight. Hours prior rather than four hours prior. I think that’s a great move because. It allows customers to plan accordingly and. Maybe shift to alternate modes of transport sooner rather than later. So in that sense I think that has been a positive move in terms of even booking volumes etc. So I think net net we are not seeing, you know if I had to say that some impact were positive, some were negative and they kind of are cancelling out each other as we speak. But it’s very early to comment. I think we changes are very very recent and I think even passenger behavior will adapt to it over time over. The next few weeks. So I Think we will only know. At the end of this quarter how this kind of impacts us, but nothing materially negative to report here.
Swapnil Potdukhe
Got it. And just a last word on Zoom. How is that business doing? You mentioned that it’s doing more than 10,000 orders per day. Would like to understand, like, any sense on the unit economics, what kind of revenues you make on a per order basis or, you know, or those kind of things. .
Aloke Bajpai
It’s still a smaller business in that sense As in, if it was material enough. I would have pulled it out to. Another line of business. As in, it’s not material. As of now, look what we. As I said before, when we acquired Zoop, and the idea of Zoop was to increase the monetization of the users that we are, that we have. So it’s our funnel which are traveling, increase the monetization. So right now we are still building the. Building the product, expanding our user base. So giving any color. It won’t help you, it won’t help. Me, and it will put unnecessary pressures to the team beyond this. But the idea is we were being. Factual in what we’ve been reporting, but. Beyond that, we’re still working on the product. And like we do for everything which is new, we would only start giving more numbers once the product has been established and stabilized.
Swapnil Potdukhe
Got it, sir. No worries. Thanks a lot for your time. All the best for future quarters and great going.
Saurabh Devendra Singh
Thanks a lot.
Aloke Bajpai
Thanks a lot.
operator
Thank you. Our next question comes from the line of Rohit Thorat with Access Capital. Please go ahead. Rohit, your line has been unmuted. May I request you to unmute it from your side and go ahead with your question, please.
Rohit Thorat
Can you hear me now?
operator
Yes, sir. Please go ahead.
Rohit Thorat
Yeah, thank you for the opportunity. First of all, congrats on the good set of numbers. My first question is on the technical and related cost part. So we have seen a sharp decline on a sequential basis in technology cost. Now, in the previous quarter, you had mentioned that the cost increased because you had seen a surge in number of. Queries in some of your products, like Flight Tracker, Train Tracker, due to which. The cost has gone up. Now, this quarter is also not like a seasonally weak quarter, so those queries should be high in this quarter as well. So what is driving the reduction in technology cost for this quarter and how do you see the trajectory going forward for the rest of the year?
Saurabh Devendra Singh
Yeah, technology costs get bunched up. I would say just look at it over the years, over the year, what we talked about last time will remain. So it is as in what you see this time is just some bunching up but otherwise not reflective of the year. In that sense what I stated as in the simple answer is what we said last quarter is what you should look and model.
Rohit Thorat
Okay. And second question is on the bookkeeping side of things. Now you today also you have made an announcement that you have granted some esop. So how do you see the ESOP. First going forward on a full year basis?
Saurabh Devendra Singh
So look as I talk, I have. Talked a lot about ESOP and you. Can go through question nine. But it’s of course going forward would be around slightly north of 30 crores per year. If you see what I’ve talked about the change from. I think Manik or one of these. Guys asked a question last time and. In this FAQ I thought I’ll document my answer in a lot of detail why there was a difference between 20 and 30. Part of it is because we get three kind of ESOPs. So one is the Black Scholes which is time based ESOPs. The other is success based ESOPs which is calculated using Monte Carlo. And you have to realize that if the success doesn’t happen it is expensed but there is no real payment. As in the ESOPs are not given but it’s still expense and you don’t get it back in that sense. And the third is when say something like zoop where we have a choice to either decide to acquire ZOOP and give them cash or give esop.
Because we feel ESOP is more aligned to the long term vision for the company. So zoop, we have chosen the ESOP path even though it affects the P and L rather than cash which won’t have affected the P and L at all. So it’s a combination of these three. But yes, the number would be slightly north of 30. Hi, can you hear me or Mr. Rohit, does that answer your question?
operator
So there is no response from the participant. Maybe move to the next one.
Saurabh Devendra Singh
Yeah, we can. We can take one more question and again I apologize to all the others who asked the question and we can’t answer. But please drop an email and we’ll set up a call and do that. But yes, we can do one more question and then we’ll leave.
operator
The next question comes from the line of Lakshmi Narayanan KG with Tunga Investments. Please go ahead.
Lakshminarayanan KG
Couple of questions. First I just want to understand how the hotel’s vertical is gaining traction. Second question is I just want to understand do you have any B2B verticals for travels especially air and hotel and third question is that I just want to understand what’s your market share? How it has trended on airline and second on X irctc, your train market share and how the bus share has been shaping up. These are my questions.
Saurabh Devendra Singh
Can you repeat the second question? It wasn’t very clear.
Aloke Bajpai
Yeah, we didn’t get the second question.
Lakshminarayanan KG
The second question is that do you have any B2B versions? For example, some of your competitors do offer B2B options where they tie up with the corporate and the entire corporate travel happens to some kind of a micro vertical based on the Internet. Do you actually have that thing? Is there a big opportunity for you? That’s my question. Sure.
Saurabh Devendra Singh
So let me answer the first two for you and then I’ll let Alok. Answer the third one. So on hotels like, I mean still. Very early, we are still in the. Build out phase and we believe, you know, it would be premature to share specific, you know, discuss any numbers at this point beyond the fact that we are seeing very strong month on month growth in room nights which is the only metric checked out roommates is the only metric that we are right now tracking very obsessively. But apart from that, fortunately we have access to this very strong top of the Funnel which is 84 million unique monthly active users on our platform. And this large user base gives us this unique advantage of creating the product, right.
Product market fit requires you to run your product through multiple iterations, identifying problems and then iterate through solutions. And we have an amazing testbed of massive number of users which we are using to kind of fine tune the product and arrive at the correct market product market sector. The fact is that you know what. We’Ve been very, very late entrant to this vertical, right? And there have been like lots of players out there in the last two decades in this space. And what we have discovered is that there’s still a lot of unsolved customer pain areas and supply related problems that could drastically improve customer experience and solve some of these problems. And so we have focus entirely on some of these problems and we are trying to kind of get to a point where we have this product market fit and we feel confident about scaling it beyond that. So that’s what I would say about returns regarding corporate etc.
It’s pretty obvious that these are verticals. That we would definitely want to get into at some point of time, only a matter of time. And the reality is that given that if Your platform has 84 million multi active users, it’s almost like saying that you Have a mall where you have huge amount of footfalls but you don’t have a certain kind of section in the mall. And so it would only make sense to kind of have some of these products. However, at this point, I can’t tell you exactly where that fits our roadmap or timeline etc, but definitely something that we have on our radar.
Sorry, what was your third question? Third question was about market share regarding.
Lakshminarayanan KG
Market share in hair. When you have market share outside IRT trained and also. And now it’s descending.
Saurabh Devendra Singh
Yeah, sure. So on train, like we said earlier, we have crossed 60% of OTA market share and I think that’s about 2% more than where we were two quarters ago on buses, we would be in mid to late teens. We obviously still await others to declare their results, conclude where the market share exactly was. And similarly on flights, I think since we are the first to disclose our results this time around, I think we would await numbers from others in order to get a sense. But based on DVCA numbers, I think we are growing nicely quarter on quarter in terms of market share even on the flight side.
So we would have definitely gained share. I mean that should be obvious with our growth numbers. I guess you can see that because you can look at how market is going, how others are going and what our growth rate is. So I mean that part is pretty obvious.
Lakshminarayanan KG
On the train thing, what, what percentage of train reservation happens outside IRCTC?
Saurabh Devendra Singh
It’s 20 to 21% of IRCTC bookings. That are happening through OTAs based on their last disclosed numbers. And I think that, you know, outside. Of that, there is also third parties which are offline or B2B etc. Which would be another 10, 15%. But yeah, I think in that, in that 20, 21% bucket, we, like I. Said, are 60% of that.
Lakshminarayanan KG
Thank you so much.
operator
All right, thank you ladies and gentlemen. That is the last question for the day. I now hand the conference over to the management for closing comments.
Saurabh Devendra Singh
Thank you so much for all of you joining us today from all parts of the world to hear out our story. And it’s definitely getting late here in. India, so I’ll let you all go. We’ll speak soon next quarter. Thank you.
operator
Thank you on behalf of DAM Capital Advisors limited that concludes this conference. Thank you for joining us. And you may now disconnect your lines.