Thomas Cook (India) Ltd (NSE: THOMASCOOK) Q1 2026 Earnings Call dated Aug. 01, 2025
Corporate Participants:
Unidentified Speaker
Debasis Nandy — President and Group CFO
Debasis Nandy — President and Group CFO
Mahesh Iyer — Managing Director and Chief Executive Officer
Vikram Lalvani — Managing Director – Sterling Holidays Resorts
Urvashi Butani — Head Investor Relations
Analysts:
Unidentified Participant
Chetan Mahadik — Analyst
Praneet — Analyst
Deepak Lalwani — Analyst
Anil Shah — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Thomas Cook India Limited Q1FY26 earnings conference call hosted by Systematic Share and Stock. 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 assistant chart in the conference call, please signal an operator by pressing star then zero on your touchstone phone. I now hand the conference over to Mr. Chetan Mahadic from Systematics. Thank you. And over to you, Mr. Mahadek.
Chetan Mahadik — Analyst
Thank you Shruti. Welcome everyone and thank you for joining us on Thomas Cook India Limited Q1FY26 earnings conference call from the company. We have with us Mr. Mahesh Iyer, Managing Director and CEO and the Senior management team. We would like to begin the call with brief opening remarks from the management following which we will have the forum open for an interactive Q and A session. I would now like to invite Mr. Mahesh Iyer to make the initial remarks. Thank you. And over to you sir.
Mahesh Iyer — Managing Director and Chief Executive Officer
Thank you Chetan. Good morning everyone and thank you for joining us as we discuss the T1 FY26 financial and operating performance.
Before I begin, I would like to introduce my management team who is joining the call with me today. With me in the room I have Debashish Nandi who is the group CFO for the Thomas Cook India Group. I’ve got Vikram Lalwani, Managing Director and CEO of Sterling Holiday Resorts, Vijesh Modi, CFO at Thomas Cook India limited And Urvashi Bhutani, who you already know manages investor relationships. Before I talk about the operating results, I just want to give you a little background to the quarter that went by the period. April to June quarter marked one of the most volatile periods for the travel and tourism industry since the COVID era, shaped by a convergence of global and domestic disruptions.
On the domestic front, traveler sentiment was adversely impacted by the tragic incident in Telegram and the ensuing cross border tensions. The unfortunate aviation mishap in mid June further tested this already fragile sentiment. The combined effect led to some cancellations and deferment. Internationally, the escalation of the Iran Israel conflict disrupted civil aviation routes and fuel supply chains. This was further compounded by persistent global trade tensions. This period typically represents a strong season for both our outbound and domestic travel. While April saw a strong start in line with our expectation, the unfolding of disruptions led to a moderation in our growth momentum across May and June.
And I will give you more details of the same when I cover the travel segment. That said, I am pleased to report that the resilience and the depth of our diversified portfolio has enabled us to deliver a consolidated top line of 24,530 million reflecting a healthy 15% growth over the same quarter last year. Despite the challenging environment. On the profitability front, our profit before tax excluding a one time ex glacier payment of $171 million stood at 1.284 million, marking an 18% increase over the same quarter last year. Notably, our EBITDA margins improved year on year from 5.1% to 5.2% driven by continued operational efficiency.
Before we get into the details of the results I want to highlight, Drizzle recently upgraded our rating to aa. This is the highest in India’s travel and tourism sector and it’s a clear reaffirmation of the group’s leadership in the travel segment and strong parental support from Fairfax. As a part of our digital transformation journey, we continue to harness the power of AI and conversational interfaces to enhance customer experience and drive operational efficiency across our core business segments. In the leisure travel segment, we have introduced TAISI for TCIL and EASY for sotc, our AI powered assistants that provide real time support, personalized recommendation and seamless planning.
Empowering customers with intuitive on travel assistance for corporate travel, our Gen AI Advisor Group simplifies complex travel requirements offering intelligent itineraries, policy aligned bookings and insightful reporting driving both convenience and compliance for our customers. In the foreign exchange space, we extend our Service delivery through WhatsApp calling, bringing our offerings directly to customer preferred platforms, ensuring ease, accessibility and speed for everyday Forex needs. I will also I’m also happy to inform that our prepaid card is the first in India which is now integrated with Google Pay along with Visa, allowing customers to add our prepaid card onto their Google Wallet and use it seamlessly while overseas on an NFC enabled platform.
Together with these innovations, we reflect our commitment to leveraging emerging technologies to deliver smarter, faster and more personalized customer journey across our portfolio. Moving on to the segmental performance, I’ll begin with the Financial Services. The Financial Services segment reported revenues of $842 million for Q1 FY 2026, reflecting a 7% decline. However, on a sequential basis the segment registered a 7% improvement. Unlike the travel segment where early bookings offered some insulation from last minute disruption, the Forex being more like a last minute transaction driven felt a sharper impact. Many travelers chose to defer or cancel their plans altogether due to the unfolding geopolitical events that directly impacted our forex demand.
The year on year contraction was driven by a combination of macro and segment specific challenges and I’ll highlight some of them in the subsequent paragraphs. The first one was the geopolitical environment that created uncertainty with heightened regional tensions impacting travel related forex flows. We also had a lower Hajj travel during the period. As you would recollect that last year, same time we had large movement on Hajj that happened this time. Given the Middle east tensions that we had, the movement around the Hajj was comparatively lower. In addition to that education segment and the recent RBI data that was published for the period April to may represent a 25% decline.
However, our portfolio continued to grow, albeit at a very small atlas, so we saw the impact of the student segment in the current quarter too. One other area that that kind of dampened our performance is our exit from Delhi Airport is something we’ve been speaking about for some time. We made a conscious decision not to renew our contract with Delhi Airport as it didn’t make great commercial sense for us. So from a comparison point of view, strictly in the current quarter we have only 45 days of trading for Delhi airport as compared to 90 days that we had in the comparable quarter last year.
On the EBIT front, the impact was a little more pronounced for us as each transaction decline affected our earnings. This is particularly more relevant for the prepaid card segment where we get volume based incentives and considering the lower demand that we saw in the current quarter, we thought it was prudent for us to look at our revenues at the lower slab and we will adjust the slabs as we see volumes coming back. Despite these headwinds, it is encouraging to note that our EBIT margin continue to remain strong, the business operating performance are resilient and our EBIT margins are at 44%, underscoring the strength of our efficiency and underlying business model from a transaction count perspective.
Despite the absence of Delhi Airport transaction counts, our transaction volume grew by about 2% and our total volume grew by about 3% to the comparable quarter last year. On the prepaid card load side we had a double digit degrowth, about 10% degrowth on the prepaid card volume. And as I said, this is a combination of various factors that I just mentioned about. From a digital adoption perspective, our foreign exchange business continues to be at about 20.4% of transactions are done digitally and we continue to see our trajectory going up. Our App bookings are up 3x year, on year and on WhatsApp, our transaction volumes are up on a year on year comparison basis.
Moving on to the travel and travel related segments. The travel and travel related Segments grew by 18% YoY in Q1 FY26 with strong contributions from both the B2B and B2C segment. Let me take you back to November when we launched our Europe holidays November of 2024 when we launched our European holidays for the summer of 2025. By late March and into April of 2025 we were witnessing strong forward booking momentum with outbound and domestic travel trending at about 24 to 25% over previous year. However, the series of external events that I mentioned before impacted our forward booking and our booking curve tapered as we progressed.
Between May and June, outbound bookings began trending closer to mid teens growth while domestic travel reflected a negative forward booking growth trajectory. Despite these challenges, our income from operations grew by 18% and our EBIT grew by 25%. Our EBIT margins improved from 3.9 to 4.1%, displaying our strong resilience from the forward booking that we saw and the diversified portfolio across the DMS group and the various geographies that we operate in. From a product mix perspective, domestic business continued was a little subdued during the current quarter as I mentioned about the domestic disruptions that we had, but our international business actually grew by about 19% in the same quarter.
The mix of B2B and B2C remains at 40 to 60 40% of the business is B2C and 60% of the business is B2B and across those segments of DMS as well as miles and corporate travel, we witnessed growth from a leisure travel segment perspective. Given the uncertain environment. We also launched a comprehensive travel safety program just to get the confidence of the customer back into making that decision to travel. The product is called Tramsure, which offers customers peace of mind and enhanced protection to their journey. The program includes free rescheduling, cancellation in emergencies, additional trip protection and 247 customer service with Trapshore, travelers can confidently navigate uncertainties knowing that their plans are safeguarded with responsive and reliable assistance every step of the way.
We also undertook Thomas Cook and SOTC also undertook the survey and we published our India Holiday Report 2025. Some of the key highlights that we saw out of that survey was Indian travelers continue to show strong preference to guided tours with demand fairly evenly spread across three categories. The Surve survey revealed that 35% of our respondents prefer group exported tours, followed by 33% opting for customized private tours and 32% choosing semi guided holidays. Essentially it means that two thirds of our customer base are still looking forward to in some shape or form guided to us and that’s a strong reflection of the business model that we operate in.
One of the other highlights that came out of the report that Europe continues to be one of the top international travel preference for Indians with 50% of our respondents selecting it as their most desired holiday region. Its enduring appeal stems from a combination of rich cultural heritage, scenic beauty, iconic landmarks and multi country itineraries that cater to families, couples and solo explorers alike. Southeast Asia continues to be one of the most dominant for the short haul segment with Thailand 46%, Singapore 37% and Malaysia 32% ranking a ranking high on the traveler’s radar. The region benefits from proximity, competitive pricing, easy visa and a variety of experiences from beaches to nightlife to shopping and adventure.
For the Indian market, Southeast Asia offers a perfect blend of convenience and excitement making it a key focus of for the travel planners looking to cater to evolving preferences in 2025. From the B2B business segment point of view, corporate travel had the impact coming from the uncertainty around tariffs. The IT and its segment continues to be the largest contributor in our corporate travel business and we saw some softness as far as volume is concerned because of the uncertainty around the large market like US Canada. Having said so, our volumes continue to grow. We had a modest growth of about 3% in terms of volume on our corporate travel business.
We continue our journey on implementing technology. I’m happy to report that Thomas Cook is currently testing our in house built travel solution for our customers called Travel one integrated with AI which is droo, which essentially will allow customers to seamlessly manage their travel bookings. This also ensures that over a period of time we will be able to move a lot of customers to self serve and reducing the need for having a lot of people are attached to a transaction. On the meetings and incentives business, we continue to grow despite the challenging environment. I think the same benefit that we got on our B2C our B2B business also had a strong forward booking pipeline before the global train winds affected our business, so global headwinds affected our business.
The business volumes overall grew by about 12% in the current quarter with no government bookings that happened during the current quarter. We managed about close to 300 groups ranging from 50 to 1,000 delegates traveling across Europe, Austria, Spain, Australia, UK, UAE and many other markets. Tomskoock also managed 120 delegates for the International Solar alliance, the Regional Committee program in Sri Lanka, facilitating bilateral meetings with various Asia Pacific ministries The Mice in House tour app which is what we are building, has gone live which allows customers to get access to their information, real time updates and also allows our tour partners or tour managers to seamlessly keep conversing with the customer.
With this update, I’d like to now hand over to Debashish who will talk to you all about our DMS operations and dei.
Debasis Nandy — President and Group CFO
Thank you Mahesh. I’ll now take you through the DMS business first and then followed by dei. The DMS business as you know, is split into the DMS India which is represented by a company called Travel Corporation and DMS International. The business is essentially seasonal and the India business for India the India business has a lean quarter. The April to June quarter is a lean quarter for the India business, so it contributed to 8% of the of the DMS business and the international obviously 92%.
However, even in the lean quarter the India business turnover grew by 36% year on year and reached 597 million of turnover. It is interesting to note that it is touched exactly the business that we did in FY20 that is the year before the pandemic. So here the India business has definitely surpassed the pre pandemic level. As far as the international business is concerned, it’s done even better. It has grown by 28%. They reached a volume of 722 crores which is 1.8 times higher than what it was pre pandemic. Just to give you some color on the international BMS business, there are five entities here spread across Asia, Southeast and Middle East Asia, the usa, Africa and Australia.
Asian Trails which it has a business in Southeast Asia and Australia contributes 40% of the business. Desert Adventures it does the business in Middle east contributes for 27%. Lip Pro the unit in USA contributes 26%. So these are the three large ones contributing 93% the total the balance 7% is contributed by two entities in Africa. The South African entity Private Safari South Africa contributes to 5% and Indian entity called Private Safari East Africa contributes over 2%. As I said, overall sales grew by 28% and this is primarily driven by the three large units. Asian Trails reported a robust growth of 42% year on year.
The countries which did very well are Thailand, Cambodia, Vietnam and China. In US the Latifra unit reported the growth of over 31% over last year, largely driven by significant contribution from the MICE segment and of course the higher volumes in the FIT segment as well. Desert Adventures the unity in the Middle east in spite of facing severe geopolitical issues, they held sales steady. There is actually a 7% improvement over last year. As you also know that this is not the season for the Middle East. This is the summer season and therefore the sales are anywhere muted.
Private safaris in South Africa did very well. They reported a 19% year on year growth driven by upselling initiatives both in South Africa as well as in Namibia. East Africa is in recovery mode from last year. It had reached full recovery and in fact it was ahead of pandemic. But we lost one of our large customers FTI due to insolvency sometime last year and the business is trying to rebuild by onboarding new customers in order to drive future growth. I will now move to dei, the Digital Imaging Solutions. This is a business which is, as you know, headquartered in the Middle east and 45% of the business comes from the UAE and the surrounding areas and therefore quarter one is not a peak period for the imaging business.
However, happy to report that the revenues held steady at 210 crores. Its margin is up by 1% over last year driven by improvement in UAE positive contribution from regions of Indonesia and Macau where we added some new accounts. Our renewal rate remains strong. Seven key partnerships are renewed during the quarter, primarily UAE and Singapore. We also operationalized two of our new partnerships in China and India and signed five new ones across the uae, Maldives, Hong Kong and Malaysia. At the same time we are also closely evaluating sites which are less profitable and wherever we need to we are exiting.
We continue to maintain the sharp focus on profitability and operational efficiency. This is visible in the sharp increase of In EBIT there is a 61% growth as you can see in the second results. In spite of the revenues being stable, our EBIT margin improved substantially from 3.2% last year to 5.1% this year, indicating the benefits of cost, efficiencies and productivity led by the usage of technology. With this I’ll hand over to Vikram for an overview of the leisure hospitality segment. Over to you Vikram.
Vikram Lalvani — Managing Director – Sterling Holidays Resorts
Thanks Nandi. Good morning ladies and gentlemen. My name is Vikram Lalwani.
I’m the Managing Director in the CEO of sterling Holiday Resorts Ltd. I’m joined by my colleague L. Krishna Kumar who is our Chief Financial Officer. We are both based in Chennai. Thank you so much for joining us today as we present the Q1 sterling performance of FY26. We are pleased to share that Sterling has delivered actually its best ever Q1 performance this year, setting a robust foundation for FY26. This also marks our 21st consecutive profitable quarter and it signifies the growing strength of Sterling brand in India’s hospitality space. So with this we can clearly state that our transformation is complete and now we are in a phase of growth.
We have successfully in Q1 capitalized on the tailwinds in Q1, a period where generally the fundamentals of leisure travel is strong due to the holiday season. Having said that, in Q1 we also witnessed some temporary headwinds. The Operation Sindur did affect business in our northern region. We had actually three of our resorts that were affected which is Jai Sarmia, Amritsar and Mount Abu, especially those in Rajasthan. And it affected business in Rajasthan, Himachal and Uttarakhand, which amounts to approximately 900 rooms or 19 deserts which is almost 33% of our inventory. This impact fortunately lasted for only about two weeks during this peak season season.
However, the strength of our portfolio across the rest of the country in the south, west and east helped offset this opportunity loss resulting in a strong performance this quarter. Few pointers on the performance highlights for Q1 Our total revenue for Q1 stood at 1,392 million 8% growth over Q1 FY25, driven by a strong growth in both room and full and beverage incomes. The EBITDA grew 25% year on year to 514 million with a healthy EBITDA margin of 37% up from 32% which makes it one of the best quarters that we’ve had. The profit before tax rose by 27% to 371 million.
We continue to remain a debt free company and our cash reserves have crossed more than 3,000 million as we speak today. Our free cash flow generated during the quarter is a little over 300 million. Our room revenue grew 11%. Our food and beverage revenues grew 16% and this is despite a 21% increase in in the available inventory. Our average rates also stood at a close to 7,100 reflecting strong pricing strength and positioning and evolving positioning of Sterling in the upscale leisure segment. A little more details on some of the operational highlights. Our guest nights grew by 12%.
The occupancy stood at 60 64% with an increased supply of nearly 50,000 room nights this quarter or approximately 540 rooms per day quarter over quarter. Having said that, we do have headrooms more in occupancy and that enables and that will put Sterling in a position where we can actually grow further as we keep scaling the company. We also added two new resorts, one in Rudra Prayag and the other in Outer Lansdowne. This is in line with the fact that Sterling has over the last couple of years created new destinations and we will continue to do so, thus having a first mover advantage in this whole aspect of it.
Our total network now is close to 3,300 rooms. In our partnered and managed results we earned nearly 10% of the revenue generated during the quarter and amounts to almost 20% of the EBITDA. Underscoring the strength of our operations in the capital free segment of resorts, little on the customer experience and the brand. We continue to be recognized as a preferred brand, predominantly the leisure, hospital hospitality space. Thirty resorts received TripAdvisor Traveler Choice Awards with one of the results that stopped being top 10% globally and one of the results being the best of the best for the third consecutive year that is top 1% globally amongst 8 million listings.
Our average TripAdvisor ratings improved with 36 results now over 4.45 on 5 and 16 results of ours now rated 5 on 5. Our Net Promoter score touched a new high of 81% with 40% of our results now scoring over 80%, a clear reflection of guest delight and consistent service delivery. This becomes important because as we keep scaling the company we are also completely focused on on the quality metrics and the results a little bit about sustainability and community impact. Under our ESG initiative Stirring Sankalp, we continue to embed sustainability and social responsibility into our operations.
Heat pumps and solar installations are progressing are being installed in many of our hill resorts. As we see plastic bottled water has been replaced by by in house bottling plants at multiple properties and we have a plan to actually ramp up on more properties as well. Our partnership with Fairfax India Charitable foundation has enabled the installation of dialysis machines across seven hospitals, furthering our social impact footprint a little bit. On the portfolio part, last year we grew our inventory by 22%, one of the highest in the industry. We strengthened our presence in key markets like Rajasthan, Uttarakhand and in key segments like Wildlife.
Looking ahead, we have over 20 resorts in the pipeline. That’s good schedule to open between in the next three to four quarters and they are predominantly on an asset light model. We also continue to optimize our own assets to incrementally invest improvements in our own resorts. We spread our own resorts by incrementally adding additional rooms within our existing portfolio. We have five to six resorts at the intersection of business and leisure in Tire 2 and 5 towns and we have seen this model succeed. While our focus is on the leisure segment continues, we are also looking to expand in the business leisure segments.
Across tier 2 and tier 3 towns. In short, we with a strong quarter in the first the start of the year driven by robust fundamentals around domestic travel demand, we are generally optimistic about FY26. The strong base built over the last three to four years positions us well now for continued growth. We remain cautiously optimistic about quarter two, traditionally the lowest quarter for the leisure travel due to muted demand. This is precisely why we are consciously reshaping our portfolio mix by introducing more leisure from business hotels, leveraging the transferability of our customers from leisure into business travel as well.
You may recall that while Q1 has historically been our strongest quarter, due to the concerted efforts of the evolving portfolio mix, Q3 emerged as our best performing quarter last year. We expect a similar trend this year as well and hence we’re looking that the H2 will be far better than H1 and we are confident of closing FY26. Also on a strong note, thank you so much for your continued support and thank you so much.
Urvashi Butani — Head Investor Relations
Please go ahead with the Q and A.
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 their Touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use hand clips while asking a question. Ladies and gentlemen, we’ll wait for a moment while the question queue assembles. The first question is from the line of Praneet an individual investors. Please proceed.
Praneet
Hello? Yeah, thank you for the opportunity. Hello? So I had questions regarding. Hello, can you hear me? Hello? Hello? Am I audible? Hello?
operator
Participants who wish to ask a question may please press Star and one at this time. The first question is from the line of Raneet, an individual investor.
Praneet
Hello? Am I audible? Can someone hear me? Hello? Hello?
operator
I’ve Based on response from the current participant. The next question is from the line of Deepak from Unifi Capital. Please proceed.
Deepak Lalwani
Hello. Thank you for the opportunity. Am I audible?
Unidentified Speaker
Shruti, I think there is some issue. We can’t hear anything,
operator
ma’. Am. Even I can’t hear. Just a moment.
Urvashi Butani
Sure. In the chat.
operator
The next question is from the line of Chetan Mahadrik from Systematics please.
Chetan Mahadik
Yeah, hi. Am I audible?
Mahesh Iyer
Yeah. Yeah.
Chetan Mahadik
Yes. Yeah. Firstly, thank you for the opportunity and congratulations on a healthy set of numbers. So my first question is on Sterling. So Sterling has rapidly expanded its resort footprint to around 62 resorts with plans to say add more 14 to 15 more in FY26. What are the specific long term average occupancy and ARR targets for sterling once these new resorts mature.
Vikram Lalvani
So yeah, Hi, good morning, this is Vikram Lalwani here. So typically when we add resorts and especially if it’s in a leisure space, it would take at least about one or two quarters to completely ramp.
As you know, I said that we’ve actually increased our inventory by almost 50,000 room nights quarter over quarter. And with that also we have a 64% occupancy which actually that means we’ve actually grown our occupancies almost, you know, in terms of room nights, almost 19 to 21%. But because of the growth in supply, looking at 64. So typically, as I mentioned, even in the past at a steady state for leisure across the year, anything between 65 to 68 is actually an ideal occupancy to maintain. Having said that, I’ve also called out that we do have scope to up the occupancies.
As we keep going up, the average rates will range if we are at a peak season about 7,100 to 7,500. Obviously in an off peak season it could vary but our focus has been more on growing the occupancy and the number of room nights more than typically trying to push up the average rates because of the growth in supply. Also it also depends on what kind of hotels open and which kind of season it opens. So yes, we will look at about 20 hotels over the next three to four quarters and they will all be in ramp phases.
If we are able to quicker ramp them depending on the timing of opening, I think then it could be more advantageous to us.
Chetan Mahadik
Okay, thank you. And second question is on other income. So on a year on year basis, if we see it has increased 50% plus, can you provide a breakup of this 45 crores?
Debasis Nandy
Yeah, hi, this is Devashish. I’ll take that question. So as you have rightly pointed out, overall other income has grown from 266 million to 440 million in the current quarter. A couple of reasons for that. I think the interest income on bank deposits has gone up by about 79 million.
Out of the overall 174, that’s 79 million. In addition their sponsorship income increase of about 18 million which is accruing entirely in Thomascope. There is a bit of exchange gain, that’s about 11 million. And then there is what you call miscellaneous income which is increased by 58. And there are a couple of components there. One is about 28 million on account of convenience, fees collected from various clients, etc. And then there is corporate guarantee income. We give corporate guarantees to all our subsidiaries as part of our transfer pricing process. And then of course there are the smaller parts of income.
So all this adds up to 174 million of increase.
Chetan Mahadik
Okay. Okay, thank you. And just one last question on foreign exchange. In this quarter we have seen a decline in revenue for forex due to geopolitical tensions, weakness in education segment and it exits from Delhi airport as you have mentioned. If you can put some light on how should we look at this segment for the rest of the year?
Mahesh Iyer
Chetan? I’ll take that question, Mahesh. Look, as I said, fundamentally nothing has changed as far as the business is concerned. Our EBIT margin continues to be strong because it’s the tail end of a transaction or a travel cycle.
Foreign exchange will always see that impact when there are global headwinds. So to that extent we saw that happening in the quarter. But my view is that as confidence on travel comes back, international travel takes place, you will see this getting back to normalcy. Our estimation of this business continues to be the double digit growth that we’ve spoken about in the past. And with our guidance on EBIT margin between the 40, 45% range and I think we continue to hold onto it. I think it’s also important to note here that on the prepaid card side we’ve been very cautious in terms of our revenue accrual because currently since we are trading slightly below what we were, we didn’t take an aggressive position on it.
And obviously as and when the volumes come in, the slab will kick in and there will be an opportunity for us to increase our revenues there. We continue to engage with customers, building a lot of journey around our technology tools in our digital adoption. And I think all of that to me is trending in the right direction. So fundamentally from a business perspective, I think the business prospects continue to remain strong and I think for the full year we should see a better outcome for the foreign exchange business.
Chetan Mahadik
Okay, sir, got it. Thank you.
operator
Thank you. The next question is from the line of Deepak from Unifi Capital. Please proceed.
Deepak Lalwani
Hello. Hi sir. Thank you for the opportunity. I’m audible now.
Mahesh Iyer
You can’t really hear the.
Deepak Lalwani
Hello. Is it better now?
operator
Hello? Mr. Deepak?
Deepak Lalwani
Hello. Hello.
operator
Before we take the next question, we would like to remind participants that you may press star and one to ask a question. The next question is on the line of Praneet, an individual investor. Please proceed.
Praneet
Hello? I’m audible. Hello? Hello? Hello.
operator
Mr. Praneet, hello.
Praneet
Can you hear Me. Hello? Hello, can someone hear me? Hello? Hello? Hello?
Urvashi Butani
Shruti, please try taking Neera from the college.
operator
All right, I’m trying. The next question is from the line of Meera Tabai. Please proceed.
Unidentified Participant
Yeah, hi. Thanks for the opportunity. But just to continue the previous question and other income, if you were to look at the entire year, what kind of other income do we see purely from a interest income from cash and cash equivalent and others. Hello? Hello.
operator
Mr. Deepak, can you hear us?
Urvashi Butani
Yeah, we can hear you, but we cannot hear Deepak. Everything else seems to be aligned, so maybe you need to check something from your end.
operator
Yes, ma’. Am. Just a moment. Hello, Mr. Deepak?
Deepak Lalwani
Yes.
operator
Yes, sir.
Deepak Lalwani
Am I audible?
Urvashi Butani
Yes, sir. Go ahead, Deepak.
Urvashi Butani
Hello? Yeah. Okay. Hi. Hi. Thank you for the opportunity. So first question is on the DMS business. We’ve seen phenomenal growth in this quarter. So is there any one time event which led to this growth and what can be the sustainable growth rate in the business and similarly for the mice and B2C? B2C travel? If you can give any sense on the forward bookings and the MICE activity bookings that we have for the next three quarters for these two verticals, please. Yeah.
Debasis Nandy
Okay. Deepak. Hi, this is Devashishar and I’ll take the first question on dms.
Dms. To answer your question, it’s largely business as usual. The only exceptional item I can think of or is that there was a large mine business that happened in USA Lit Pro and the benefit, the business was worth about $4 million. Now if you look at the overall sales, there are about 22.6 million this quarter. Visavi about 17 million last year. So even if you take that one, there is a margin increase over last year. Other than that, the business has been usual. And in any case the mice business is a contractual business and therefore this sort of business will keep on happening.
We don’t consider MICE business as one time. But since you specifically asked this question, I thought I’ll give you that input.
Mahesh Iyer
I’ll take the second part of the question. Deepak, to give you some kind of guidance on forward booking. I think I kind of alluded to in my commentary. Today we are living in a bit of an uncertain world. And what we’ve seen is some of the patterns as to how customers look. And specifically the B2B segment has changed. So unlike in the past where a lot of decisions were made two or three months in advance and specifically for the MICE portfolio, we are seeing that cycle to be much shorter today.
So from the time that we are conversing with the customer to closure and travel is essentially happening in less than 30 days. So. So if you ask me to kind of give you a sense on what, the power pipeline looks a little more difficult because we are actually taking our business much closer to travel. So the pipeline is getting built in the same quarter that we are trading. So at this point in time, as I said, for the quarter that went by, despite the headwinds that we had, our volumes grew by about 12%. I think we will continue to see that kind of trajectory going forward. I don’t think nothing has fundamentally changed. There’ll be some amount of weight and loss that will happen before a decision is made.
But clearly I think the future opportunity on the business remains strong.
Deepak Lalwani
Sure. Just a follow up on this. Despite the weaker sentiment in this quarter, we’ve been able to grow. So have you seen any green shoots starting July onwards? And although we are closed, the business model has changed to slightly shorter term order bookings. So has anything improved from July onwards? If you can give a sense on that.
Mahesh Iyer
So Deepak, again, as I said, what happened is for the B2C businesses we had the headwinds coming right in the thick of a seasonally strong quarter. For us, our bookings took a beating post these events in the third week of April and that sentiment continued because of multiple events that happened during the quarter.
Post that in July, we have definitely seen a bit of a trend reversal if I used the word. So both on the international side that is short haul as well as long haul and on the domestic side it’s more like a recovery from a negative territory which is de growth over last year. We actually starting to see a positive trend where we are now getting closer to what we were at the same time last year. Now the reason for the domestic part, as you clearly know, this was Kashmir. Kashmir is one of the largest portfolio, largest markets in our portfolio followed by Himachal, Uttarakhand and stuff like that.
So obviously that portfolio didn’t fire because of operations in the closure of airports and stuff like that. But when I look at the current trending, I think they’re starting to look promising and both the short haul and the long haul on the international side are starting to get to better territory which is more like the double digit growth one would call it to be. So I think we will see better turnout and as Vikram also alluded to, we remain optimistic of H2 of current fiscal and I think that’s how the business will trend. And keep in mind that we Are also entering into a bit of a festive season.
So there will be some demand that will be driven by festive. And added to that we’ve done the travsher program which is basically to reassure the customers, give them the flexibility of booking and stuff like that. So trying to do a lot of things to get the confidence back and keep the sentiments going.
Deepak Lalwani
Sure. So second question is for the cfo sir. So other income has become quite a significant part. So if you can split the cash between client funds and our own funds and how should we look at the yield that we make on other end on our cash book for the full year? So what kind of other income run rate because that run rate has been volatile for the last three quarters.
Debasis Nandy
Sorry, I didn’t read the first part of your question. You think split the cash between is the other income between client funds and my funds?
Deepak Lalwani
No, no. I want the split between the cash that is our funds and the client funds. And on total cash, what kind of other income are we looking at?
Debasis Nandy
Okay, well I’ll answer the first question then. I want to say something else on that. But my overall cash is 20 to 48 crores. That’s the total cash that I have. Against that I have a gross debt about 280 crores and my BPC float as of now is about 1570 crores.
So that’s what we have on the cash flow. Your second question is on the is on the other income. See the other income is obviously the function of the cash that I have. But I must also say that the entire cash that I have is not deployed into India, deployed into fixed deposits. Because as you know the BPC while we are talking about a BPC talk as if it’s cash on hand. Not everything will be cash. There will be part of it will be in the form of receivers from corporate. Because when you are selling a card, we are loading or loading a card.
The corporate will not be on B1 will pay in 7 days time as per the credit period. 7 to 10 days time. Some part of the cash will have to keep in keep available for use, daily use and only the balance I can then deploy depending on some algorithm that you use into longer long term and short term FDs. So it is not a straightforward calculation. But yes, other income to sort of sum up other income will keep on increasing as we grow the overall cash in the business.
Deepak Lalwani
Sure. Second third question is on the digital imaging side we’ve seen improvement in the profitability despite the top line being modest.
So are the cost in terms of technology behind us and what kind of sustainable profitability can you look at for the digital imaging segment?
Debasis Nandy
So you’re right, and I did mention this during, while I was talking about the digital imaging business. The growth in profitability can be attributed entirely to the cost rather than on the top line. And this has come through careful cost control and cost reduction cost initiative launched by the business. And so the cost benefits, the benefits around cost has happened from largely from the indirect overhead. Now going forward, obviously, as you know that we are also building a, building a technology solution, a software which will probably come into effect possibly from the third quarter onwards and that should give us some productivity gains.
It’s a little difficult at this point of time to sort of visualize or anticipate clearly exactly how much we’ll gain, but maybe we’ll take a little quarter or two to figure out what exactly is the financial benefit out of that. There are obviously financial and non financial benefits coming out of that. We also expect the top line to start growing over time over the next couple of quarters in the second half, more in the second half of the year rather than the first half. And that should overall improve the overall profitability of the business.
Vikram Lalvani
Divachi, if I can just come in and add.
And Deepak, I just want to mention a point here. While the top line looks muted, please also remember that this is a conscious call. While we have also ensured that we went out and looked at our portfolio and weeded out some of the accounts where we thought that we weren’t actually making a lot of money. So some of those accounts had to be reconstituted and we had to renegotiate. So in that bargain we let go of some accounts and that also had impacted the top line. But I guess it’s about putting the right blocks in place so that the long term trajectory for the business remains strong.
Deepak Lalwani
Understood. Got it. Thank you sir. I will just join back and thank you for. Thanks.
operator
Thank you. Before we take the next question, we would like to remind participants that you may press Star and one to ask a question. The next question is on the line of Praneet, an individual investor. Please proceed.
Praneet
Hello, I’m audible.
Debasis Nandy
Yes, you are.
Praneet
So I had questions regarding DMS specifically to start up. So on the DMS B2B business, I understand that in last phone call you mentioned that we basically the product that we provide to other travel agents or whatever is a white label product so that they didn’t buy from Thomas Cook. So I was wondering why do people come to Thomas Cook to Get these label products because they’re entire distinct in the market is that they make the packages or they try to procure it. So I was wondering what is the reason of Thomas Cook particularly creating these white label products and how was the overall competitive space particular to this? Is Thomas Cook the only one who’s doing this particular service to other TAL agents or how is it going forward? And in the B2C segment, I was wondering what is my understanding, right, that the B2C segment, DML is basically what we sell under SODC and Thomas Cook, is that right? Understanding.
Debasis Nandy
So I think we need to correct some of some concepts around this. The DMS business. The DMS business essentially is a B2B business and not a B2C. Begin with. Okay, so it is very distinct, very distinct from the distinctively B2B. There’s, there’s no trace of a direct consumer business here. The way this business operates is that our DMS businesses interact with overseas tool operators and serves their customers. So maybe you can call it, at best you can call it a B2B2C business but not a B2C business directly. So the way it works is the overseas tour operators would like their own custom retail customers to come to this, come to this country and these countries.
That country can be India or us or any other place where we have a presence and they would request us for a particular itinerary or costing. Create a particular itinerary along with obviously with the costing around it. And once we finalize the iterate and the pricing around, it’s a white level contract because the ITER is actually created by us, also operated by us. That’s why we call it a white label. However that is the tour operator sell it to his B2C customers as their own Nigerian. So the our job begins when the customer’s customer, so to say comes into the country.
We sort of take care of them while they are in the country, take care of the hotel, the sightseeing and so on and so forth. Now does that explain? I just want to understand that. Is the concept clear? It’s not a B2C.
Praneet
I’m actually wondering. So basically you’re saying that the overseas store operators basically approach Thomas Cook to create a white label product. So technically our customers, the travel agency itself, and they will be, let’s say a spokesperson or whatever for that particular market to the customer, right? This is my understanding. So I was wondering, so is it a local itinerary or it’s someone coming from India to go there or how is it so is it because some, over some person, some traveler want, wanted to get a package from India to.
That is potentially Africa. So how does it work?
Debasis Nandy
I think, again, I have to, I think focus on, give some examples to make my point clear. Maybe I was not very clear the last time around. So where do you operate? First of all, where do you operate the DMS business? It’s operated across Southeast and Middle East Asia, is operating in Africa, in USA and Australia, and of course India. But in this current quarter, India is a small part of it. So let’s take an example of the business in Southeast Asia. We have a company called Asian Trail headquartered in Thailand.
And let’s talk hypothetically about an overseas operator trying to get a ITV for Thailand. Let’s say so Asian sales will create a white label that you for Thailand, okay. And sell that package to the B2B operator overseas. The B2B operator will obviously sort of put his own markup and sell it to his B2C customer. That B2C customer comes into Thailand and its trip is then managed by Asian Train. Okay, now not a traveler from Thailand that’s actually approaching. I’m sorry, so. So basically it’s, let’s say X so in Thailand or the travel approaches Asian Trails then travel agency.
So let’s say the basically Asian Trails. Let’s say someone from Thailand wants to go on a trip and do they approach inbound? Okay, it is not. We are not talking about outbound ships here at all. So
Praneet
basically some Indian traveler,
Debasis Nandy
let’s say a European. Okay, let’s say, let’s say, let’s take a example of a Dirt Touristic, which is a relay, which is a German group. Okay. It’s a German tour operator, just like Thomas Cook in India. Now, third, Touristic will get German customers, obviously, right? The German customer wants to go to Thailand, does not have a direct entity in Thailand, doesn’t have a subsidiary in Thailand and therefore it has to approach a local tour agent who knows, has a clear understanding of the place and can organize the tour there.
So they approach Asian Field and there will be many other people like Asian Trails. It’s not the only one in Thailand. So they approach Asian Trails. Asian Trails creates a tour for Dirt Touristic and Dirt Touristic sells that to his German customers. The German customer comes to, flies into Thailand, is taken care of by the Asian Trails people, and then he goes back, he makes a payment to Dirt Touristic and Dirt Touristic makes a payment to Asian Trails. Is that flow clear now?
Praneet
Yeah, it’s much clearer. Thank you for that. So I was wondering, I understand that we are basically a B2B service.
So how prominent is this practice in the market? So basically two operators, they don’t even the market, do they? Not at all. What percentage of it the two operators makes it only themselves and operated by themselves. And what percentage is usually that they approach some big player like D to be like Thomas Cook, whichever country might it be to operate the tools? Like how is the market shaped in that way?
Debasis Nandy
The entire two wheel operator industry works like this. Okay, let’s say even if I take Commerce Group for an example, let’s say I’m organizing a trip.
I’ll give you two examples, one for Europe and one for us. So if I’m taking, let’s say you come to me as a customer and you ask for us, I will, you know, call up Allied People, which is my unit in US and help ask him to create it for you. Right? Allied People is my subsidiary, my hundred percent subsidiary. So it is from A Sukhin another form. Now let’s take the second example. You want to go to Europe. I don’t have a subsidiary or an entity in Europe. So I will depend on a local unit, a local dm, DMC or distribution management company to create an IT for you.
So in that case I sort of outsourced this for them. And this is the most common thing in the tool industry.
Praneet
So this is very prominent practice. Basically wherever I might approach.
Debasis Nandy
It’s a global practice. And you know, even in the domestic market. Let’s for example, if you go to, let’s take an example of you know, Leh Ladakh, for example, you go to Yale Ladakh, you book a trip through ABC and Company. ABC and Company actually get some local operator from Laidla Duck to create a tool for you because it doesn’t have a business that doesn’t have an office in Leila Duck.
Okay, again, this is, this is the most common thing that happens in the travel industry. Probably 90% of the tools will happen in this fashion. Probably I don’t know the percentage, but I can, you know, I can guesstimate 90% work will be done in this fashion because you need local guy who has the knowledge of the, you know, of the terrain and where we thought to manager to there.
Praneet
So wherever, let’s say the BM basically whatever the procurement of the customer happens in whatever shape or form. But the thing is when it comes to the operation part of the door or itinerary part of it, the approaches to partner in the particular region to Operate the tour and complete the tour.
Is that my understanding? Right.
Debasis Nandy
Absolutely.
Praneet
Got it. So since the business is unlike this, so how. What do you think your particular market positioning is in the particular DMS as a market? Because now I’m assuming that travel is very simplistic, that the travel agent might do the thing. But I want. So this is entire B2B side of it. So wondering how is the market shaped like that? How many players are there and how is the competent?
Debasis Nandy
There are thousands of people like this. Okay. Like Asian trains, you know, in Thailand probably there are several thousand.
I don’t know how many thousand honestly, but there are several thousand. Several thousand travel agents will be there. If you walk the streets of Mumbai, I don’t know where you are from, but if you walk the streets of Mumbai, you see so many travel agents. Right along with commoscope, it’s a bit like that.
Praneet
Got it. So but like how is, how do we particularly grow in this particular business? Like what, how do we. What is the strategy to growth in this particular DMS business? Like how does it work?
Debasis Nandy
That’s a very simple one. That is the simplest question so far in the sense that the idea is to procure more and more B2B operate operators as your customers and you get that through, you know, obviously and of course retain the existing ones.
The way you do that is to, you know that you take part in various trade shows, travel trade shows, etc, you approach them directly or through agent, so on and so forth. Just like you know any other industry, you get new customers, corporate customers is the same way.
Praneet
Understood. So one, I want to understand how these particular Thomas Cook brand names plays into place at this point of time.
Debasis Nandy
Sorry pr we are not using the commerce to brand name which is. I specifically mentioned entities like Asian Sales, Desert Adventures. Those are the brand name. We don’t use the commerce brand name beyond India, Mauritius and Sri Lanka.
Praneet
I understood that part.
operator
Mr. Pr.
Praneet
Yeah.
operator
Can you join the queue again, sir? We have other participants waiting. Thank you. The next question is from the line of Neera Sawai. Please proceed.
Unidentified Participant
Yeah. Hi. Am I audible?
Debasis Nandy
Yes, you are.
Unidentified Participant
Yeah. So my question is extension the previous question on other income part. So is there any mark to market forex gain in this quarter which is driving this other income or how do we read it?
Debasis Nandy
No, I mentioned the components very clearly. No, I talked about the increases coming in from, you know, interest on interest on fixed deposit interest in basically interest income. I talked about interest in sponsorship income. I talked about increase in collecting convenience charge from customers and I did talk about 11 million of our exchange.
So I think I gave the breakup bit clearly.
Unidentified Participant
So when we look at an annual basis, what kind of overall other income we should look at? Which one
Debasis Nandy
Very difficult to say. I don’t hazard a guess on that because obviously sponsorship income, convenience fees from customers and financial gain cannot be quantified at this stage. As far as interest income is concerned. It will also depend on the cash that you have. And you know the BPC float that we have is obviously the significant portion of that. So if the B2C float continues to grow, the income will grow.
But you know, other than that, you know this on the existing cash flow. This is the sort of income that you have when you look at the current cash is round about 700 crores excluding the fruit. Yeah.
Unidentified Participant
So is it right to assume about 70 odd crores can come from core interest income and rest can be.
Debasis Nandy
I think 10% is the current yield rate. Some we Invest in a 10% yield FD if you can
Unidentified Participant
increase it over a period of time.
Debasis Nandy
No, but we know very very well, all of us know very well that the yield on deposit is going down across the world, including India, isn’t it? 10% yield on fixed deposits in the first place in the current, if you look at the current yield is much, much lower than that and we don’t know where it will go in the next three quarters.
So I would not like to hazard a guess on what yield I’ll get for the next three quarters.
Unidentified Participant
Right. So basically we’re saying the sponsorship income has grown by about 2 crore rupees on a yoy basis. Apart from that there are some miscellaneous income which has gone by about 6 crores on a.
Debasis Nandy
Yeah, yeah. Interest income has gone up by about 8 crores.
Unidentified Participant
And what was the quantum if I work at the absolute number last year in Q1
Debasis Nandy
last year out of 266 million 140 million was interest income and this year out of 440 million 219 million is interest income.
Unidentified Participant
Right, right, right. And the sponsorship income is something which is sustainable every quarter or it is lumpy in nature or how do we.
Debasis Nandy
No small shift income is really the income that we get from various overseas. Various overseas tourism company, the tourism board rather which is which is used for doing the campaign. So this is. This can be similar. This is depend on which country wants to do a campaign in at what point of time we don’t control this. This is entirely a of the two respective tourism boards as to whether they want to run a campaign.
So we cannot Consider this as a sustained source of income. Yes, there is, there is some income that comes in every quarter but we cannot ascribe a sort of futuristic value to it.
Unidentified Participant
Right. We are seeing largely this 12 odd crores going to about 20 crores on the net. Interest income is something which is a key component of this growth. And apart from this sponsorship income and miscellaneous income which you say generally it doesn’t happen in every quarter is lumpy in nature.
Debasis Nandy
Yeah.
Unidentified Participant
That is the reason why other income overall appears to be lumpy because it has been oscillating between 20, 25 crores and even 50 crores last quarter.
So which is changing the entire earning from the company standpoint. So would it be possible to give a range at least? You know this can range between let’s say 100 to 150 crores.
Debasis Nandy
Can’t give you a range. I have told you the variables very clearly. I have told you the sponsorship income depends is we do not control the sponsorship’s income. As I said, we are there the increase of 11 million on account of foreign exchange fluctuation. We do not control the foreign exchange rates. And on the bank deposit. Yes. Last year was interest income was 14 crores.
This year was about 22 crores. So that’s all I can tell you. I cannot really project. But all that I can tell you. Yes, you know, obviously there will be an interest. Continuing interest income will continue. Now how much, whether it will grow from 22 crores or remain steady at that phase will depend on two things. What is the float that we have and which will obviously keep you posted on the float that you have and what’s the you know, market yield on things. Deposits.
Unidentified Participant
That’s it from. Thank you.
operator
Thank you. The next question is from the line of Anil Shah from Insightful Investments. Please proceed.
Anil Shah
Yeah, sure. I just wanted to ask you on Spelling Resorts wanted to understand what’s exactly our positioning. What kind of clientele do we see there coming? Is it a lot of more of corporates doing their events there along with obviously large employee, Is it more of families and you know what, I’m just not able to get clarity in terms of what exactly is the positioning. Is it premium? Is it luxury? Is it super premium, Is it value? What exactly are we looking to target and how do we get this occupancy to move up and are we looking to do any promotional pushes there and what kind of target audience are we looking to do it? Okay.
Vikram Lalvani
Hi, this is Vikram Narwani here. I’ll ask you a question now. In fact, let me eliminate certain points that you have to ask. We are certainly not luxury and we are not ultra luxury. Okay? The way we have positioned ourselves in the last four years and when we started this transformation journey we have positioned ourselves as most of our mid scale properties have actually moved up to an upper mid scale level. Some of them have moved into an upscale level and some are, some of the new ones are moving in the upper upscale level. So actually the range that we are playing with is the upper mid scale to an upper upscale level.
Now in this whole mix, if you have to see from a leisure perspective, our strength is in families. And so the family holiday typically is the one where we tend to become the first choice. And since now we are present in over 55 destinations, the transferability or the auspicious of the customer from one location to the other actually becomes very much easier. Now we also have a couple of hotels as I said that we are moving towards the business come leisure tire two tier three towns as of now and we have approximately five or six and they’ve been extremely successful.
So those are hotels or resorts. Hotels which are typically run on an efficiency led model. So they would attract a lot of the corporate travelers or people who are coming for both leisure and corporate purpose. Having said that, in certain markets like Rajasthan, even certain markets like Gurvayur, weddings play a large role. So the wedding business is typically the Rajasthan led business which is October to March. So the purpose of travel can vary. Like for example a wildlife resort where we’ve got the best, the best also and we are opening we have the largest network of wildlife resorts in the country.
The only brand to have almost 15 wildlife resorts will attract a different person purpose of travel. Now Tripeshwar would attract a more upper upscale. Maybe a gear would attract a more upper mid scale. How it’s actually getting classified. I hope that answers your question. We also have, you know, mice which is, you know, meetings, incentives business especially this time of the year plays a large role. Our corporate program actually is a whitelisted solution using sterling1, which is our distribution proprietary distribution platform that actually gets into corporates where corporate employees can book their holidays or their corporate programs with us in a span of 30 seconds and fulfill it or less than a minute and fulfill the entire transaction.
So that’s how varied the entire model is. And it’s better to be this way because in the event like how this quarter himachal completely is down, we try to leverage other segments into other resorts so as to mitigate any risks that may happen. In one or two segments or in market or two regions. I trust I answered your question?
Anil Shah
Yeah, this is a follow up on this. You know, I mean, X the members and I know we don’t take new members, but X the old members who would still be, you know, the old sterling members, you know, is there a.
Are we tracking in terms of, you know, a new client or a new individual family who comes in for one of our resorts and who’s also a repeat customer who’s not a member? I repeat. And do we have that kind of analysis which is done, which kind of tells you that someone who comes into your resort goes back with an experience and he wants to come back to different resorts all across,
Vikram Lalvani
Right. It’s a very good question. Let me answer this in two parts. Yes, we have stock membership acquisition and we are servicing our existing members and we are servicing them exceedingly well.
Number one. Number two, just like you take for example any city hotel, they vie for, you know, the crew business, which is a stable business through the year. So in a leisure model, the membership business actually fills in that particular gap and gives you confidence, constant revenue flow through the year. Number three, in terms of you keep the. Not the members, you keep the other segments there are. The way we actually measure it is in form of two parts. One, who will repeat accounts for us. So like for example, if it’s a MICE account or a conferencing account, whether they do, you know, 1, 2, 3 meetings incentives with us this year, are they repeating next year? Probably in a different destination as well.
So that is one way in which we see, you know, who are the repeat accounts. Number two, we see who are the repeat guests. Now they may, you know, stay with us in ot. The same guest could stay with us in a, in a Rudra Prayag that we just opened for a pilgrimage purpose. So when he wants to go on a pilgrimage, he may say to a Gurva Yur, he may choose us in Gurvayur. And if he wants to go to a hill destination, he may choose a Munnar or an Aleppi if he wants to a backwater experience.
So we also track it that way. In terms of the accounts, we have almost a 90% hit rate. In terms of the guess, it’s actually in the last two years we’ve started measuring and managing it pretty well. So actually our ratio is approximately 15 to 18% today and it’s growing significantly.
Anil Shah
No, I’m sorry, can I just as a follow up.
operator
Sorry to interrupt. Mr. Anil, may we request you to Join the queue. Thank you. The next question is from the line of Mukul Varma from Varma Associate. Please proceed.
Unidentified Participant
Good afternoon and congratulations on a good quarter. I have three questions. I just wanted to understand the growth guidance from a three year perspective. Are we on track to grow our guidance on a consolidated basis? They just try 12 to 15%. And what would be the margin trajectory? Because if I look at the last five quarters it’s been 6% except for March quarter and I just remove the one off from June quarter it maintained at 6%. So is there a possibility of increasing margins going forward? And second question is on the taxation front our tax rates are close to 33, 34%.
So will this remain like this going forward or is there a way we can move to a new system which kind of reduces the tax burden?
Mahesh Iyer
Mr. Verma, this is Mahesh here and I’ll take your questions and probably I’ll get Debashishin to answer. On the taxation side of it. We. Normally don’t give any forward looking guidance on it and obviously three years looks very long for us to kind of look at it that way. In the environment that we live in today there are a lot of events that shape how travel industry will operate. So very difficult to give that kind of a long shot at it. But clearly I think from an intent point of view, as we’ve been saying at every call we are focused on building scale, we are focused on bringing in more technology, we continue to focus on productivity, we continue to focus on margin management.
And I think all of this helps us to improve our ratios, improve our margins as we go along. From an expansion of margins perspective you would have seen that trajectory over the last two, three years and we continue to chip off wherever we can actually get better margins. But having said so, it’s also important to understand that as markets mature and you find more competition coming in or you have these headwind events that happen, you will have to change your strategy. You’ve got to get a little more tactical in a certain period of time because you want to continue to maintain these kind of volumes because with volumes comes economies of buying comes from scale and all of that is very relevant for us in the industry.
So clearly I think there’s no one clear straight line answer for it. But there are multiple levers that we look at it. These are important KPIs that we monitor and rest assured we will and as we have said we will top industry growth rate. So if the travel industry is going to grow at 10 or 11% we will top that growth rate for sure. And that’s the only guidance I can give you at this point in time.
Unidentified Participant
So what has been the industry growth kind of projected for the coming year?
Mahesh Iyer
And Mr. Verma, if you can look at it, I think multiple reports have been published on this.
I think they’ve spoken about growth rates in the. Yeah, we will share some of those data points with you, but they are different as you will appreciate that we operate B2B and B2C. There are different growth rates for each of those units and in different geographies. So rather than giving you a straight one line answer, I’d rather give you a breakup of it. And happy to come back to you and get my investors team to get in touch with you for this one
Unidentified Participant
for sure. Thank you. Thank you. And one more thing. Recently you had this tie up with this Disney cruise line.
So some updates on that of how things are.
Mahesh Iyer
As you know, this is the new cruise line that’s starting off to sail for Singapore. This is a new offering. Both Thomas Cook and SOTC brands have a tie up with them and then we are looking to promote. You will appreciate that just about after the pandemic, India had a cruise line in Cordelia. It still sails and it’s now sailing within India and to Sri Lanka. And we had some great success. So we’re trying to build because there’s a lot of excitement around it. It’s a product that appeals to the younger generation, more importantly kids.
And we believe that’s an opportunity for us to build some depth on the cruise tourism part of it. So that’s, that’s an opportunity we saw and hence we have made a tie up with them.
Unidentified Participant
Absolutely. Sure.
Debasis Nandy
And Mr. Vermont, I would like to sort of try and answer your second question which was on the taxation part. So as you know, the obviously there are multiple companies that grew. Thomascope, which is the summer Scope is the standalone company, is obviously largest contributor to profitability and it still continues to be the old regime purely because there are some net credits that are still available and we would not like to lose those deferred tax assets.
And that’s why you are in the old regime and you’re likely to be there for the next three years or so. All the other Indian companies have migrated to the new tax regime is at 25%. The reason you see the tax rate at around 33, 34% typically. And we have seen that last year as well as this year. There’s obviously one reason is Thomas Cook, the largest profitable entity is at that rate. And also as you know we have been talking about the units, the overseas units gradually coming out of losses into profitability. So obviously while a lot of them have come to probability a few the of of them still make a loss and we haven’t there, we haven’t considered the sort of tax break on that.
These are smaller units and you haven’t considered the tax break okay for different tax assets because the law may not be there in those countries which is why you’re seeing a rate of about 33, 34% I to have I, I guess this rate will continue for a while and over a period of time we see that reducing.
Unidentified Participant
Great. So okay, great. So for the next three years we can look at the same tax structure and probably from the fourth or fifth year we can look at lower tax rate. Thank you. Thank you and all the best.
Debasis Nandy
Thank you so much.
operator
Thank you. The next question is from the line of Deepak from Unity Capital. Please proceed.
Deepak Lalwani
Thank you for the follow up. Sir, on the forex side you mentioned that the cards this business slow down a bit. So if you can elaborate on that and seems to be and there seems to be a weakness in the wholesale side. So is it predominantly because of Hajj and how are these two segments and in totality improving from July onwards?
Vikram Lalvani
So Deepak, on your first question on the prepaid portfolio, I think it’s got to do with what you’ve seen in the last quarter which is, you know the international travel sentiment has been lower. Typically on the forex business we have dependency both on the Thomas Cook SOTC because we sell a lot of that to our own customers and we also deal with third party which are other traveller companies because foreign exchange doesn’t necessarily cater to the Thomas Cook SODC fees only but they also deal with other travel agents.
Now the general sentiment was was impacted because of the global events that we spoke about as a result of which the uptake on the card was a little lower and that’s the impact. But as I said we are definitely seeing the shift from customer preference moving to plastic from currency ports and the digital economy is taking shape. I also spoke about our integration with Google Pay which we believe will bring more convenience and security in the hands of the consumer. All of this is to ensure that our portfolio on the card continues to grow. To give you a perspective from a market share, we are close to about one third of the market given the size and scale at which we operate and at that scale you will find that there will be the spirits where you will find some challenges coming in.
But I think I still believe the business can continue to grow at about 10% mirroring the kind of growth rates that you will see on the Forex opportunity. It’s all about acquiring new customers, building new partnerships as we said. And there was a press note that we released. We also entered into an arrangement with Muthoot to expand our offerings and create a distribution base for our products. So we continue to look at more opportunities to increase our portfolio. On the prepaid card side to your question on wholesale, while the Hajj did have a little bit of impact on the wholesale wholesale side of it because we supply currency to various constituents in the market which are selling to their own customers, there was some impact.
And I also spoke about the rule that RBI implemented sometimes last year which is the 7525 rule where they said that 75% of the currencies that I sell to other market participants in the foreign exchange they have to in turn sell to the retail customers. Now typically in the segments like ffmc the full fledged money changes in the forex business end up doing trades between themselves which qualifies as wholesale transaction and not retail transaction. So obviously to that extent they had to find new set of retail customers to whom they can go and sell and in the absence of that they were constrained to buy large volumes of currency.
And obviously that’s also a compliance requirement from our end to ensure that we don’t sell more than the norm, which is if they cannot sell 75% to the retail customers, I cannot sell the next branch of currency to them. So essentially there is a bit of a requirement from the regulator so it’s a compliance norm. So there is a little bit of dent that has come on account of that. But as I said on a comparative basis we are seeing that trajectory changing and I think foreign exchange over the next two quarters should start seeing a better trajectory.
Deepak Lalwani
Perfect, thank you. And on the travel segment, sir, while you’ve sustainably increased your margins any and you’ve guided for 5% in the long term any thoughts on the margins for this current year at 526?
Vikram Lalvani
Difficult Deepak to quantify that. I think previously Mr. Verma asked this question and I did mention that look, we, we have to be a little more tactical at some points in time. The markets are a little uncertain, we are witnessing geopolitical upheavals. So clearly we want to be staying cautious. We don’t want to just say that we will focus on margin enhancements.
We may have to be A little more competitive. We may have to just go out and look at expanding our market and stuff like that. So some tactical calls may come into play and hence I don’t want to give you a forward guidance on it. I can just say that we are focused on market margin management. It’s an important lever and KPI for us and we’ll continue to review opportunities for enhancing that as and when we come across it.
Deepak Lalwani
Okay, got it. And the use of cash if you can touch upon that. So 700 crores on the balance sheet.
Are we looking at big capex in any of the verticals?
Vikram Lalvani
We’ve always been a satellite model.
Deepak Lalwani
Or looking at any increase in dividend payouts.
Vikram Lalvani
What we are looking at is only technology, some part of technology investments that we do. But they are small sums of money. There are no large capex plan at all.
Deepak Lalwani
Okay, and is there a thinking from the board to increase dividend payouts if the capex is going to be light?
Vikram Lalvani
Look, it’s a decision at the board level. I wouldn’t want to kind of give any commentary on it as an as. And when the board discusses and feels it appropriate, obviously you will come to know about it.
But I don’t want to kind of go and talk about something that’s outside my domain at this point in time.
Deepak Lalwani
Okay. Thank you sir. All the best.
Vikram Lalvani
Thank you Deepak.
operator
Thank you very much. Due to time constraints, that was the last question. I now hand the conference over to the management for the closing comments. Over to you sir.
Mahesh Iyer
Thank you. Thank you so much. Ladies and gentlemen, thank you so much for being on the call. As I said in my opening remark, it was a difficult quarter, the April, June quarter because of the various gains that we saw shaping in the peak of summer or a travel season as one would call it. Despite that, I think we put up a good performance out there. Profitably grew by 18% to 128 crores. And our cash balance and our balance sheets looks very steady. We continue to invest in our markets trying to improve customer experience and technology tools.
All of which I believe in the long run will help the company to continue its growth trajectory. Thank you so much for your patience and for your questions on the call. If there are any follow up questions please reach out to Mr. Debashish Nandi or Urvashi who will be more than happy to clarify this for you. Thank you so much.
operator
Thank you. On behalf of Systematic Share and stop. That concludes this conference. Thank you for joining us. And you may now disconnect your lines.