Release Date: November 14, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Thomas Cook India Ltd (BOM:500413, Financial) reported a 9% year-on-year growth in total income from operations.
- The company's operating margin increased from 7.04% to 8.05%, indicating improved efficiency.
- Earnings per share rose to ₹1.39 from ₹1.01 in the previous year, reflecting better profitability.
- The foreign exchange business saw a significant growth in retail, with a 23% increase, driven by a 49% rise in the overseas education segment.
- Sterling Holiday Resorts, a subsidiary, achieved its seventh consecutive profitable quarter, with a 25% growth in EBITDA.
Negative Points
- Geopolitical issues in the Middle East have negatively impacted some business segments, particularly DMS and DEI.
- The US operations closure contributed to a revenue decline in DEI, affecting overall performance.
- The company faces challenges in the long-haul travel segment due to visa issues and changing consumer preferences.
- There is a noted slowdown in the Hong Kong B2C business, with recovery expected to be only 50-60% for the full year.
- The company anticipates some softness in the foreign exchange business in the upcoming quarter due to reduced travel in December.
Q & A Highlights
Q: What is the outlook for DEI's growth and margins for the full year and FY26, given the decline in the first half?
A: (Unidentified_7) The last two quarters are not our best, with the next quarters being stronger. We closed the US operations due to unprofitability, focusing on profitable businesses. The geopolitical scenario affects 50% of our business in the Middle East and Maldives. We are signing new businesses and expect growth to continue.
Q: What is the cash position excluding the restricted cash for Forex at the end of the quarter?
A: (Unidentified_6) We have over 1,800 crores of cash, with about 1,500 crores as float. The balance can be considered unrestricted, though the float is not for long-term use but can be used for short-term working capital.
Q: What is the India outbound number for the quarter, and does it include both long and short haul?
A: (Unidentified_4) The India outbound number for the quarter is 385 crores, including both long and short haul, but excluding domestic.
Q: Are there any updates on the RBI policy that could lead to consolidation in the Forex market?
A: (Unidentified_4) There have been no fresh updates from RBI on the specific policy. However, RBI has been canceling many licenses, indicating a move towards consolidation, but this is speculative.
Q: How is the trend of consumer upgrading in the outbound travel business?
A: (Unidentified_4) Customers typically start with domestic travel, move to short haul, and then long haul. They may start with group tours and then move to FIT (Free Independent Traveler) for deeper cultural experiences. We used to have a 2.5 times repeat ratio pre-pandemic, and we aim to track this again in FY25-26.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
