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Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
Ladies and gentlemen, good day, and welcome to the Indian Railway Catering & Tourism Corporation Limited, IRCTC, Q2 FY '23 Earnings Conference Call hosted by Dolat Capital. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Rahul Jain from Dolat Capital. Thank you, and over to you, Mr. Jain.
Thank you, Taneli. Good afternoon, everyone. On behalf of Dolat Capital, we welcome you all to the Q2 and Half Yearly Results for FY '23 Conference Call of IRCTC Limited. I take this opportunity to welcome the management of IRCTC represented by Smt. Rajni Hasija-ji, who is the MD of the company; and Mr. Ajit Kumar-ji, who is Director, Finance and CFO of the company. And now I would like to hand the conference over to the management to take the proceeding forward. Over to you, please.
Thank you, Rahul. At the outset, let me wish you a very warm good evening to everyone, and welcome you all to this con call of IRCTC for the quarter which has ended on 30th September. I hope you and your dear ones are in good health and being good.
Yesterday, company had already submitted unaudited financial results for the second quarter and half yearly for the fiscal year 2023, and the same has also been disclosed on both the stock exchanges website, too.
I can give you a brief overview about this financial year, both with our Director, Finance, who is also the CFO of the company, will provide the details of the performance of our business segments which will be followed by the question-and-answer session. In the second quarter of financial year '23, IRCTC business model has again demonstrated the resilience which has been there in the past so many months. That is the profit after tax surged to INR 226 crores with, you can say that 42.5% up, as compared to quarter from previous corresponding year.
And also, the company's revenue in this quarter has also increased to INR 806 crores from INR 405 crores as compared to the second quarter of the previous year. And this quarter, in the second quarter of our financial year '23, the revenue that is INR 806 crores is almost double, if you see year-on-year basis. And quarter-on-quarter basis, if we compare with the previous quarter, there is a slight decline due to the lean season. September is a lean season for us, gentlemen. We shall provide now more color on the same in a few moments when would be discussing our segmental performance.
The most important note is that the revenue from the second quarter of the financial year '23 continues to be higher than the quarter revenue which was in the pre-COVID period, which is very important because the growth has to be compared with that only. All the business segments, except one, saw revenue higher than the pre-COVID levels. The quarter-over-quarter decline in the consolidated revenue was driven by a factor of 5% where our quarter-over-quarter decline in the Catering segment was also noted because of the lean period which has a corresponding impact on the Rail Neer as well.
You would recollect that the Catering segment was the driver for quarter-over-quarter revenue growth in the last quarter of the financial year '22 and the first quarter of this financial year. On the positive side, IRCTC has been able to -- has been able to add slightly to EBITDA margin, which has come up to now 37%, 37.8% in the quarter 2 of the financial year '23, seeing an improvement of 20 bps quarter-over-quarter.
As I shared earlier, sir, with the headwinds of a pandemic behind the travel and hospitality industry, now we can look forward for a much better fiscal year and beyond. IRCTC business segment can also look up to further improved performance in such industry environment.
I shall now hand over the call to my colleague and our Director, Finance, who is also CFO of the company, Shri Ajit Kumar, to brief you on the financial and segmental performance of the company. Thank you very much.
Good afternoon, everybody, and I hope you and your dear ones in good health. I can first give a brief overview of our Q2 FY '23 results, post which we shall have the question-and-answer seen.
Q2 FY '23 revenue saw another quarter of strong improvement on year-on-year basis. Revenue of INR 806 crores almost doubled on a year-over-year basis, given the impact of the pandemic in this quarter.
As CMD Madam has already mentioned, due to the quarter-over-quarter decline in our largest segment that is Catering, the consolidated revenue declined by 5.5% on a quarter-on-quarter basis to lean period, but still remaining comfortably over the pre-COVID quarterly run rate. EBITDA margin for the quarter came at 37.8%, which implies an improvement of 20 bps on a quarter-over-quarter basis. The absolute EBITDA and net profit for Q2 FY '23 is also comfortably higher than the pre-COVID level.
So now let us come to the business segments of the company, the #1, the Internet Ticketing segment. It has continued to demonstrate its resilience and revenue for the quarter and stood at INR 300 crores, growing by 13.2% year-over-year and largely unchanged quarter-over-quarter. The segment has shown resilience with regards to profitability with Q2 FY '23 EBITDA margin coming at 84.2% versus 34.5% quarter-over-quarter and 83.1% year-over-year. Next to the Catering segment, that is after strong growth in the previous 2 quarters has a slight moderation in Q2 FY '23, with revenue for the segment coming at INR 334 crores, lower by only 5% quarter-over-quarter, though on year-on-year basis it grew by 4.7x. Also, the revenue for Catering segment is well ahead of quarterly run rate seen pre-COVID.
Lower revenue resulted in EBITDA margin moderating, which for Q2 FY '23 came at 10.6% versus 12% quarter-over-quarter and versus a loss on a year-on-year basis. Importantly, EBITDA margin for the segment is slightly lower than the 11.1% to 11.4% range [indiscernible] financial year '20. The decrease in revenue was due to less passengers traveled in Q2 due to lean season as compared to quarter 1.
Our next is the Rail Neer which has seen Q2 FY '23 revenue come at [ INR 72.1 crores, ] which implies a decline of 13.2% quarter-over-quarter and a year-over-year growth of 75%. EBITDA margin for the segment came at 7.5% versus 11% quarter-over-quarter and 6.8% year-over-year due to increase in preform, leather, petrol material cost which is increasing now.
Then the next is Tourism segment, that Q2 FY '22 revenue comes at INR 99.1 crores, which implies a decline of 13.9% quarter-over-quarter and a strong growth of 2.6x on a year-on-year basis. Due to a decline in revenue, the segment saw minor loss at EBITDA level as the cost of states business increased as compared to quarter 1 and less passenger travel in stages in installing as compared to quarter 1.
For Q2 FY '23, the cash and bank balance of the company as of the end of the quarter is INR 1,900 crores. Net worth for the shareholders also increased from INR 2,238 crores. It has increased from INR 1,884 crores as on 31st March 2022 to INR 2,238 crores.
Now that brings to the end of the opening remarks. So now we can move straight to the question and answer session. Thank you.
[Operator Instructions] The first question is from the line of Jinesh Joshi from Prabhudas Lilladher.
I have a question on the ticketing segment. So is it fair to assume that full migration of reserved to unreserved category has already happened and now the current situation is up into pre-COVID? And in that context, can you share what is the convenience fee and number of tickets booked for the quarter?
Yes, Mr. Jinesh. Your question is that if pre-COVID level of the [indiscernible] travel has been achieved. So let's take a look. In this particular quarter, which has ended in September, the Sleeper class now has contributed to 46% and 2S is nearly 13%, average, July, August, September.
So the pre-COVID level, although the total number of Sleeper class maybe a little more than the Sleeper class as of that time because few more numbers have been added. In this quarter, the overall percentage ticketing has been almost 82% instead of 81%, it is 81.93%. And the -- you said the convenience fee, can you please repeat your second question, please?
What is the convenience fee and number of tickets books?
Okay. In the convenience, the number of ticket growth is nearly -- the entire quarter has been INR 10 crores, INR 10.69 crores. Average is nearly INR 3.5 crores I think in each month. So that makes a total of 10.69, with a few crores here and there for that week.
And then you had asked about the revenue received in this particular quarter from the Ticketing Segment, convenience fee. In this particular quarter, we have got nearly INR 200.32 crores which is at par nearly with the 4-year achieved in the first quarter. In the first quarter, our revenue was nearly INR 207 crores, now just INR 200 crores.
Sure, madam. One last question from my side, and that pertains to the Catering business. I think in the last call, you had mentioned that we are servicing approximately 1,000 trains. And out of that, roughly 600 is on the PSU side. The balance is pantry. So just wanted to understand how big is the potential here, especially on the PSU side, given the fact that it will not be feasible to have a pantry cars in all the train which have relatively shorter rooms. And in that context, how should we look at the growth in the Catering business given the fact that we have seen some sequential decline this time around?
Well, there is no decline. We were happy to note that there is increase in this segment as well as far as the number of trains is concerned in both segments. In the -- I think, prepaid trains and Gatiman, Tejas [Foreign Language] put together the train where we have pantry cars. We have nearly 450 trains. And in the same side, vending, where we don't have a pantry car, they are now, as of now, as on date, 715 trains are there where IRCTC has been able to place the contract. And I think nearly for the 200 more trains but pantry is in the pipeline which is going to be finalized within a week or so. So as far as the number of trains is concerned, it is going to be on an incremental side.
The next question is from the line of Akshay Bhor from Citadel.
And as always, congratulations on good set of numbers. I think just a question, just a follow-up to the previous question. The railway, the Indian Railway provides 10-day data on passenger traffic, I would suggest that October versus last October result, 30% decline or 29% decline on the passenger traffic. I understand there is an impact of 2S. But I just want to understand, is the impact of 2S now fully captured in the October data and from here on whatever the number -- absolute number is, we should continue to -- see that number continue, which is about 59 crores passengers. Should we -- 5.9 crores passengers, should we continue with that kind of run rate?
Mr. Akshay I would like to correct you. So that versus October data, we are not talking about in the financials, we are only talking about the September. There is a clearcut demarcation between the reserve travel and the unreserved travel. In the overall data, which Indian Railways had published for the 10 days contains the unreserved as well. For IRCTC as of now, we deal only with the reserve data. So one difference is that. So that cannot be compared with our figures. And moreover, our figures is only up to September, and there you were talking about the October figures.
So I don't think so that will be an appropriate. It wouldn't be appropriate to compare both the segments at this juncture because October data, I don't have with me as of now. And in October, let me tell you, for the reserve segment, we have a festival movement, which is always going to be always higher than the September movement. Maybe in the next con call, for the next quarter, if I will be discussing, perhaps we would be talking about that.
So September is considered as a lean period, which I mentioned in my previous remarks or so. October is a festival period. All festivals in the Eastern India, Northern India and the rest of India have fallen in this period. So we are going to have a good number. That is why our average though stood at 82% in September, we may see some variation in the month of October. But still we take only the cumulative figure. So more or less, it may be come out to be nearly a little more than the previous average.
I'm sorry, let me clarify. This is -- so the railways also provide reserved versus nonreserved, right? So we are only talking about the PRS nonsuburban data. So my question is that, should we assume that from October onwards, the full impact of 2S going away will be visible from here on? That's my question.
It's a gradual, it has already started from the previous month also. Earlier, we were having nearly 36% to 37%, at that time 39% of the 2S booking. But as of now -- I just now I have informed while answering question of Mr. Jinesh that, that figure has now reduced to 13%. But the overall earning in the convenience fee in that segment has remained the same. Our revenue from the convenience fee has been impacting because in the results segment, the bookings start 120 days before. So the festival gain, which I mentioned in my last -- if you recall, [Foreign Language] last year, the concall which I had for the investors, when we had submitted our first quarter result, I said we are going to be compensated by the volume gains of the festival booking which is going to happen for the 120 days before. So that is the impact we got this month and our revenue from the convenience fee recorded is nearly the same sir.
Yes. Same, I agree. But the question is, from here on, should we expect that number to be steadily growing or declining...
As I've been mentioning, that temporary gain now has been adjusted and more or less -- 13% is more or less -- if I see the average of all the 3 months, July, August, September, the figure is nearly 13.2 to 13.1 [indiscernible] , the average comes to be 13%. So more or less, it is going to stabilize near here and there.
Okay. Okay. And then my second question is on the Catering segment. You're obviously well ahead of pre-COVID levels and the revenue is obviously higher than pre-COVID. But how to think about margins here? I mean is this 10% to 12% kind of margin is something that we can work with? Because the margins in both Catering and Rail Neer are still below pre COVID despite the revenue being higher? Just wanted to understand where do we expect margins?
At the outset, let me tell you Akshay-ji that the margins in the Rail Neer has been impacted because petroleum prices have gone up. And because the petroleum prices have gone up, it has affected marginally preforms from where the bottles are manufactured. So it has impacted. So we can only gain by volume. So whenever more plant come in, we may gain by that. And most of the plants which are coming up around the PPP model where we are going to having really negligible expenditures. It's only the capital expense we are going to have.
The Catering our margins are more or less same rather. If you have a -- we are going to have a long-term contract every 5 years, where we will get more margins. We are going to be in a positive side in the next few months to come. But we are going to have a long-term contract instead of a short-term contract.
COVID has almost settled. We are now -- we can now plan for a long-term contract. And the all trains, which were in the pipeline. Most of the trains have started, new trains are pouring, IRCTC has been providing catering in all the trains. Most of the PSU trains have also been taken into account. And all our tender of the PSU trains are gradually in the pipeline, 700 or nearly 700 awarded, 200 in the pipeline [indiscernible].
Sorry to interrupt, ma'am, your voice is fluctuating a little bit.
Now, if it is okay?
Yes. Yes. We were not able to hear the last sentence that you said.
I said the process is going to be continuous addition of trains. And with the long-term contracts, we may have -- we may anticipate some increases in revenue also.
Got it, ma'am. And there is no change in revenue sharing between you and Indian Railways in catering and Rail Neer segment from the pre-COVID level, and that remains the same.
No, that is going to be same because it is based on an MOU between Indian Railways and Indian Railway Catering & Tourism Corporation.
The next question is from the line of Madhuchanda Dey from MC Group.
I have two questions. As you mentioned that the profitability will improve as you have more of your own plant in the Rail Neer. If you could just highlight the trajectory of capacity expansion and what kind of revenue should we be expecting in the next couple of years as this process happens?
I have a second question, which is on the segmental loss in the tourism business. I just wanted to know you had mentioned in your opening remark about Tejas train. So I just wanted to know what contributed to the loss in the quarter in this segment.
I will enlighten you on this Madhuji. First is the Rail Neer plant. You said the category augmentation. As of now, we have already opened our Una plant and Simhadri plant, all licensing work has been done. And the first 2 bottles have been produced. We are just refining the quality of the water over there. Once the quality of the water is settled, and because this is a unique kind of a plant where we are making water from steam. So it is in association with the NTPC Simhadri. So now as of now, my capacity, IRCTC capacity is to produce 15.52 lakh bottles a day.
And our other plants, Bhusawal, Bhubaneswar are going to be live this year. We had planned this year, this financial year, they are going to be live. With this, we would be further adding 2 capacity of 1 lakh, 44 lakh -- 1.44 lakh bottles. So that is going to be making my capacity near 17.5 lakh bottle a day.
And by the end of '23 or the beginning of the very next fiscal, other 2 plants will also be there in our final commissioning stage. So you can anticipate that our achievement of 18.4 lakh bottles a day would be achieved in the beginning of the next financial year.
Okay. And that will -- that will make you self-sufficient in -- to what extent, I mean.
We are not stopping here. We are going to appoint a consultant, again, to review the water requirement. Because the population has also increased, and this is based on our data which is 2 years old. So after that, the things have gone -- changed. So we are again reviewing the requirement at other locations now.
Okay. Okay. So for that capacity addition is expected.
And your second question why the Tourism segment has shown the losses. Well, September is not a month where one goes out on to reserves. Generally, it is a period when the lot of fasting and Pitru Paksha happens. So our is -- our main chunk is religious tourism. So that did not have in the month of September. Now we are going to have -- in October, we had a very good movement. And in November, also, we are also going to have a very good movement.
And in Tejas segment also, [Foreign Language] customer movement was less. Although the segment was in profit and overall profit in the half yearly has been nearly INR 9.3 crores in the Tejas, but since the revenues from the Tejas has been less, so it has impacted the other segments also. Although the occupancy in the Tejas was less in the last 2 months, in the month of September. In October, it has gone up.
[Operator Instructions] The next question is from the line of [Ajinkya Permada] from [Metaverse Equity].
Good afternoon, everyone. So my question is state and tourism segments have not performed well during this quarter. So is there any specific reason for that? And increased lease liability and financial lease liability is creating additional burden of financial costs, which is impacting bottom line. So how management is planning to improve bottom line.
First thing first, you see that special is not a liability to IRCTC in any manner because these are the special trains which we indent once we get the request. And most of the special trains are running on a sponsor basis. So the state sponsors that. And in the cold period, when everyone as states was struggling, there was not much activity happening on the welfare side. Now the states have started and our revenue in this particular segment has gone up.
In October, you will see we have run 19 trains of Madhya Pradesh, which the impact of the same will be seen in the next quarter. September in any case is not a time to travel. Pitru Paksh, Navratri, so many things are there in the September. So 22 days very less tail happens an overall figure also goes down. [indiscernible] not a liability, not any cost. It's only a pure revenue game for IRCTC.
[Operator Instructions] The next question is from the line of [Ayaan Thera from Equity Treasure Capital].
I have two questions. The first one is I want to know about the non-convenience fee revenue this quarter. And any overall guidance of non-convenience fee revenue for the whole year?
And my second question is regarding if you are able to provide any tourism revenue guidance for the whole year.
In the -- if you see the total Internet ticketing revenue, their revenue is divided into 2 parts. One is the convenience fee and other non-convenience fee. If I take the half yearly figure of the IPCC, the total revenue in the half year as INR 601 crores, INR 300 crores in each quarter, we can say roughly. So in that 67% of our is from the convenience fee and rest 32%, 32.5 percentage is from the non-convenience fee resources. And out of that, if you see the total non-convenience resources, how much is contributing to the total income of IRCTC into the total percentage. 6% is the service charges that we are receiving from the various banks and nearly 12.5% that we are receiving from the agent. I pay -- my payment gate is contributing to my total revenue of the Internet ticketing is nearly 5.32% and advertisement is nearly 6%, it is contributing. So you can say the major case is still with the agent business that 13% is coming from the agent business and [indiscernible] is also contributing 6% of the total revenue.
And you wanted to know the road map of the tourism. Tourism, with all our rail tour packages are -- have been on the track. Our trains are on that trend. We have again also started one more segment for darshan. Our trains are running. Our FTR operations are on. Impact will be seen because FTR operation impact is seen in the next month once we get the entire revenue. And state theertha, we are running this state theertha for the 3 states as of now, Rajasthan's train is flying, Goa it is running, Madhya Pradesh is going to start again. We operated in the month of October. And we operated around 20 trains for Delhi government up to July, August, September, there was no movement from their side. So we are going to operate that also. We are also talking to many states. Rajasthan is also going to add more. So we are going to have a good amount of our business in this particular segment as the time to come in this financial year.
As far as air ticketing is concerned, yes, we have started gaining in these segments. Our segments have improved. Our business on the budget total is also going to improve because new tenders have been decided and 2 more in the pipeline with the new license fee. In fact, there has been a record collection of license fee in one of the budget hotels, which you will come to know very pool once we discuss the results of the next quarter.
And -- all other various packages are also doing fine. Our air package business has gone up, and you will find a good improvement in this particular quarter.
Madam any tourism total revenue guidance for this financial year upcoming '22 and '23.
Tourism is a choice business. So it may jump to any number or it may be on a very average kind of a side also. Any negative news in the market, for example, as of now, we don't have any e-Visa. It is impacting inbound tourism in the entire country. So is our train may also get affected. Maharaja and Golden Chariot. It is -- tourism is the impact of the overall condition of the country. Any news of the COVID will impact it. Any news of pandemic is going to impact it. So it is -- you cannot commit on the tourism business, however, we try to make it as much as we can. We are going to operate many trains of the state. You might have seen that we have tied up with the Karnataka State Tourism, Karnataka government also for operating their train, that is also there. We are also going to have a tie-up with the other state government for operating their train. So this business, we are going to capture our new operations.
Any minimum EBITDA margin which we expect to generate -- any target EBITDA margin we have in mind for the tourism segment itself.
So 7% to 8% margin is working in this segment, the margin is less. We don't have any monopoly, we compete with the unorganized sector. And it is just like any other tour operators, IRCTC is nothing, it is just like any other tour operator. The way other tour operators are operating, we have to operate in the same manner, same competitive environment, run here and there, made packaging success all across. So the competition is very, very high. Everyone is doing the business. So what we are doing, we are doing our best, we are trying our level best.
In this scenario, we can expect 7% to 8% margin roughly.
Yes, yes. At least, if that projects, our segment is not in the losses. The impact of COVID is still seen in the tourism. It has not gone from tourism. But in the -- because that is a railway business is a different kind of a business. This is a different kind of a business.
[Operator Instructions] The next question is from the line of Rahul Jain from Dolat Capital.
Firstly, ma'am, I would like to ask about the tourism business. What are the incremental trigger that we see from a growth collection point of view. You already alluded about hotel new licenses, I missed that part? And anything from the outbound level also if you could comment on.
The first is the Tejas that is our private train, which has contributed nearly INR 74 crores in the overall revenue of this financial year. October revenue has been up and we can anticipate that the November, December is going to be good, if nothing goes wrong in the industry. If our occupancy level increase, we are going to gain out of that. If you see our hotel segments and the retiring room segment, there also, if the passenger number increases, retiring room segment always increases.
And in the Hotel, we are going to bring an aggregator, the moment we get an aggregator our hotel bookings are going to rise. And in the bus we are doing pretty fine up to October rather. We have done a revenue of nearly I think INR 10 crores or so in the bus alone up to in this financial year. And where we have covered 22 states and state transport also we have tied up individually with 8 transports also. So that segment is also going to do good.
The only segment, I don't see any negative point in it because now the season for the travel has come. From October to March, it is a season when we travel. So luxury tourism also our Maharaja is on the track and is still running. Our Golden Chariot will start its first operation on 20th of November. And all our other -- our Deluxe is going to be on the track very soon because things are now improving. We are also going to operate, revive our Buddhist sector very soon.
Okay. And any volume you could give in terms of the air ticketing, what was the seat numbers in last couple of quarters? And what is the run rate right now?
I can only give you the segment number, let me check if I have that figure with me for the Air. Segment booked if you see in the month of July, August and September, I'll just read out the segment in each quarter. The segmental -- it is a month -- in the month of July, we had booked around [1 lakh 29 segments]. In August, we had booked around [1 lakh 39 segments]. And in September, we had booked around 1,68,000 segments. And we have also increased our convenience fee from INR 50 to INR 100. So income from booking -- gross booking amount has particularly been more and our I think INR 5 crore revenue we have registered from this particular segment. It is a pure revenue commission.
Right. And secondly, on Tejas, what is the -- what was the revenue utilization. What is the frequency right now? And what was the profitability for Tejas?
Frequency Rahul-ji has been restored to the previous level. On the day of a holiday, we operated also in the month of October. Our occupancy level in this particular financial year for the Ahmedabad Tejas is nearly 83% and Lucknow Tejas is nearly 73%, 73.9%, so 74%. And overall revenue from both the Tejas up to September '22 is INR 74 crores. Operating expenses has been to the tune of 64 lakhs, 64.8 lakhs, and there is a net profit of INR 9.3 crores in the Tejas segment.
Have we got more passengers in this -- so that would have been better. But let's see if we can get it this month or the next month.
Yes. Sorry, I missed the -- after revenue you said INR 74 crores, I missed the rest part.
Our operating expense has been INR 64.82 crores. And our net profits from this segment is INR 9.3 crores.
Okay. And any -- of course, there's no new tender or about those to start for privatization, but is there any process that we are also initiating from our end to clients to switch for more private routes?
Sir, as of now there is no tender or policy from Ministry of Railways. So once they have it, so we'll certainly inform our investors.
Right. And ma'am, in the Catering segment, if we were to do the lean period assessment, is that process behind us or is still pending.
Almost completed Rahul-ji, and you will see impact in this quarter. But we will tell them to pay in case there is any increment, wherever the increment is in the, I think, last quarter because we have to give them some time for payment. The impact will be seen in the fourth quarter only. We have completed the process, and now we will be initiating the NOCs as required.
And what number of licensees have been now asked for this revised pricing?
It depends on the trend, sir. There are a few trends, there is a zero increment has been noticed. 2 trends that we have been seeing. Few trends has been I think decreasing side also. But that is not going to impact us because we are going to charge only the coated license fee. So the loss is not going to be there. And we have to just sort it out where the sale assessment has resulted in -- so we'll have to have a consolidation. We are having consolidation. We'll be submitting the results soon.
Right, right. Okay. So -- but as you just said now, the -- this has now been identified and -- but the revised pricing advantage we may see only in Q4?
Depending on case to case basis. Yes, we will see in the Q4.
Right. So can we say that now since most of the business, and I think you also mentioned this in your opening remarks, that most of the business now have seen the complete cycle, so as to call it from a COVID and pricing hike plus 2S, all those things are now largely done with. And from calendar '23 onwards, we will see a more normalized picture of the business from all the segments?
Yes, sir. Hopefully, yes.
Right. So with these things behind, what could be the real growth driver other than the usual passenger traffic growth, which may happen in a year now?
As I mentioned that our Rail Neer plant study is -- we are going to do it again because we are finding it that very soon we are going to have our production level reaching at the optimum level that is around 18.5 lakh liter bottles a day. But we will again do the survey and we'll find out another opportunity if this business is there or not.
Then second will be, we would like to increase our non-convenience fee resources to the best we can. And our commission in the IP model, our model, as you can see in IP alone, in this financial year, our business has been to the tune of nearly INR 32 crores is the total revenue and INR 9.13 crores is the net revenue, net profit to the IRCTC. And that is up to September. So this figure may go up to -- may go up more than INR 60 crores, INR 70 crores, who knows? So we are trying our level best and our profit in this segment will also go up. So we would be targeting any specific points, and then we would also be targeting the State Teertha and other segments.
Our election cycles are also happening this month. So we would have incremental benefit in October or November, December until the time elections are done, we would be gaining. If we are able to get the BSF for which we have already signed an agreement with them, BSF movement traffic, we will be gainer out of that also because we would be doing that train. Half of the train will be covered in the tourism segment. Half of the train catering portion will be covered in the catering segment. So that gain is also going to be there. Hopefully, if everything goes right, the company will certainly do good.
Right. And the current output, what is the total unit produced during this quarter?
About the Rail Neer?
Yes.
Facility utilization has been very good in the month summer. In the summer few plants have done as high as 90%, but the overall capacity utilization of these plants. I'm sorry I don't have figures readily available as of now, but before we close, I'll get you.
I got it. I got it. 75% nearly is the capacity utilization figure [indiscernible] there was a flood. And 2 places that there was a some issue in the water access, the groundwater level has gone down. So those issues keep coming. So put together, 75%, we will increase this further. However, November, December, January is a bad month for Rail Neer because the requirement goes less. Summer again from February onwards, it will pick up.
Right. And on the CapEx side, can you share the CapEx for new office and also the other CapEx that we plan for next year?
INR 250 crores we have to pay to NBCC for acquiring our new office, which we have to pay in a phased manner. Our first 2 installments are gone. So that CapEx continues to be there as per the plan given by NBCC.
Secondly, we have already started giving tenders for doing our -- one is the regular expenditure and for the capital expenditure in the Internet ticketing. And we are going -- we are completing our upgradation in the Internet ticketing. So that plan is also on for that, we had anticipated INR 100 crores in my first quarter concall, if you recall, out of which we have already spent some amount and some of amount is still due which we are going to close very soon.
Okay. And last question from my side. Any specific reason why the depreciation charge has gone up from INR 13 crores to INR 18 crores in this quarter.
We have some -- as per advise of our auditor, this question will be answered by our finance guy will be better.
Because of this quarter, our ROEs increase because of the new leases added in this quarter now. Because of that, the depreciation has increased.
Sorry, I could not understand. ROE increased for?
Whatever the lease results we have to count it as an asset of the company, right, and for the accounting standard. So whatever lease charges we have paid to the -- our leases. So we have to account it as assets in the company. And accordingly, we have to account for the depreciation as interest on that. It's the requirement of the accounting standard actually.
The next question is from the line of [Uday Nagireddi], Individual Investor.
My question is about, is there any plan in the future to increase the Rail Neer price, bottle price. I think since a very long time it has been INR 15.
These deliberations are on in our company. And we are doing some cost analysis. So like hope for the good. Until that time it is done, it is not there in the market and we cannot comment upon that because these prices are administered prices. Since the preform prices are going up, it calls for the day that we should recommend to the Ministry of Railways for increasing the price. And its deliberations in the company is already on, we have already discussed this matter amongst ourselves. So let's hope for the good.
The next question is from the line of Akshay Bhor from Citadel.
Just want to clarify the previous question. You're saying for the Rail Neer, if you have to increase prices, you have to go through the Ministry of Railways and hence sort of get an approval from them to increase the prices. It is that correct?
So we can only deliberate internally. And we can only decide whether what should be done. We are deliberating internally. In any case, these are, as I said just now, the pricing for Rail Neer are administered by Ministry of Railways. So we'll have to go to Ministry of Railways to get the approval on the price decision.
And just to clarify, similarly on catering as well, if you have to make any changes to the pricing or to the contracts, it has to be approved by -- it has to be approved by the Ministry of Railways, is it?
Yes, sir, we have -- in the -- from [indiscernible], we have been mentioning always that our pricing in the catering front, in the Rail Neer is decided by our Ministry -- Parent Ministry that is Ministry of Railways. It is only in the conveniency IRCTC has been given a flexibility. We are DoD of IRCTC, can decide the convenience fee to be charged from the customer.
Just one last question from my side. We know that all your tickets ultimately get booked on the IRCTC platform. I just wanted to know what is the share of the third-party initiation of bookings. So let's say somebody initiates the booking on MakeMyTrip and what is the percentage share of such bookings which are originating from a third-party website?
It would be initiating from the third-party website, but finally, it would be coming to me as my B2C partner, right. In the -- but in this B2C partner, our charges are high. And we charge not in addition to convenience fee, our convenience fee, which is INR 15 and INR 30 in the normal case and a little concession for the UPI payments, which are INR 12 per ticket more from them.
Just wanted to know what is the rough percentage of such tickets getting booked?
Nearly, I think, no more than 25%, 20% should be there. I'll get you the exact figure before we close.
[Operator Instructions] The next question is from the line of [Pradhan Jadeja from Coast Value].
Ma'am, I have 1 -- I have 2 questions. One is we said that the Internet ticketing pricing for convenience is in our hands. So I think it's INR 15 and INR 30 seems to be very low. When are we likely to revise this?
Not in near future. Not in the next 6 months to come because we have just passed through the bad case of COVID. And until our efforts would be to maximize our non-convenience resources and other resources, let's not put more burden on the customer.
So in the long term, can we expect?
This is in our Board's hands. Our Board is competent to decide on this matter. So we do have internal deliberations happening in our Board on this issue also. But as of now, we are unanimously, we are of the opinion that as of now we may pend it for some time and let the industry restore to the maximum. Travel and tourism, as I mentioned, in the tourism sector, things have not restored completely Things are still hanging around. Many people have lost their jobs. COVID has been very bad as far as the travel and tourism is concerned.
Okay. And we are not charging any convenience fee for UPI payments?
No, we do charge. We do charge, like our normal convenience fee is INR 15 and INR 30, INR 15 for the sleeper class and INR 30 for the AC class, it is 10 and 20 for them.
Okay. And what is the percentage of UPI bookings versus the...
33%. 33% is the booking.
And my last question is we had applied...
Let me correct, it is 27% is the booking for that. And in the month it was -- average is 27%, but it has been nearly 33% from April to September.
Okay. Okay. And my last question is we had applied for ..
Let me correct, it is 27% is the booking for that. And in the month of [indiscernible], average is 27%, but it has been nearly 33% from April to September.
And my last question is we had applied for a license of payment aggregator with RBI payment, what is the status on that?
For that, RBI had asked us to make certain changes in our MO. That changes have been approved by our esteemed shareholders in the AGM. After that, all documents have now being submitted. And our consultant has also been appointed in the matter, so we are pursuing that further. So maybe we may get a good news soon, as soon as we are done, we will inform our investors.
And what should be the impact of this on the revenue and margins?
I just mentioned in answering one of the questions that IP is a very good option. See, IP as of now, we are operating only as a PD, we are not operating that as an aggregator, only in our system because we don't have a license of that.
In the 6 months, in the 6 months of this year, we have been able to earn around INR 32 crores of revenue, out of which INR 9.13 crore is the pure profit. And this is the half yearly figure I have. So merely in the -- if we count the figure to be doubled in the year, so maybe a little less, we would be ending nearly around INR 60 crores or so. And our revenue will be nearly, I think, INR 15 crores to -- somewhere between INR 17 crores to INR 18 crores. And this is when we have only the PG.
But if we have aggregator, come up as an aggregator in our website alone, and the way we can go outside our website also, this is definitely going to add more business and getting us from the transaction.
As there are no further questions, I now hand the conference over to the management for closing comments.
It has been a very thought-provoking session. And our first quarter has been good. Our second quarter has been more or less the same with slight changes with certain segments getting affected. First quarter was very good because we were comparing with the bad time. And second quarter, we are comparing with the good time. But if you compare quarter of the previous year, we have certainly done very nice. So we are hoping that investors will continue to have a same relationship as they have earlier and keep showing their faith in the IRCTC in the times to come. Let's hope for the good and wish very good for the company. With this, I wish you all the best in the days to come. Thank you very much, investors, and just stay with us. Thank you.
Thank you. On behalf of Dolat Capital, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.