Indian Railway Catering and Tourism Corporation Ltd
NSE:IRCTC
Earnings Call Analysis
Q3-2024 Analysis
Indian Railway Catering and Tourism Corporation Ltd
IRCTC's third-quarter performance was nothing short of historic, as the company boasted its highest ever quarterly operating revenue, surging to an impressive INR 1,118 crores. This milestone represents a robust year-on-year growth of over 20%. Such a feat was primarily propelled by two of the company's core segments: Catering and Tourism, which exhibited exceptional expansion and proved to be the main engines of this revenue growth.
Within the robust revenue story, the Catering segment took the spotlight and reported a year-on-year growth in revenue of 29.1%, reaching INR 507.70 crores. Not only does this figure represent a significant 17.6% increase sequentially, but it also marks the highest revenue recorded for any third quarter and nine-month period in the segment. What's equally commendable is the notable improvement in the EBITDA margin reaching 15.44%, compared to 10.73% from the previous year, signaling improved efficiency and profitability in this vertical.
The Internet Ticketing segment persisted with its resilience, weathering the conversion of reserves to a ticket back to pre-pandemic levels. The revenue for this quarter tallied at INR 335.31 crores, underscoring an 11.4% growth year-on-year and a modest 2.39% increase from the previous quarter. Additionally, this segment retained a high EBITDA margin of 83.02%, which, despite minor fluctuations, upholds its reputation as one of the more profitable arms of the company.
Tourism, a segment vital to IRCTC's portfolio, experienced a substantial revenue upswing of 42.2% year-on-year, translating into INR 195.47 crores for the quarter. The segment also saw a significant leap from the preceding quarter with a 21.11% growth. Attributing to the higher revenue, a positive EBITDA margin of 12.10% emerged, showcasing a remarkable improvement from 3.3% in the sequential quarter and also topping the previous year's metric of 10.79%.
Rail Neer brought in a revenue of INR 83.76 crores for the quarter, representing healthy growth rates both quarter-on-quarter and year-on-year. Particularly noteworthy is the consistent enhancement of the EBITDA margin now standing at 13.43%, marking progression over prior periods. However, the segment faced a dip into negative profitability due to an exceptional adjustment item of INR 14.51 crores in this quarter, diverging from the previous quarter's positive profit.
The financial stability of IRCTC remains secure and robust, with the company ending the quarter with cash and bank balances amounting to INR 2,258 crores and a solid net worth of INR 2,946 crores. This financial positioning provides a buffer for maneuvering through future investments, operations, and potential market volatilities.
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Ladies and gentlemen, good day, and welcome to IRCTC Q3 FY'24 Results 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, sir.
Good afternoon, everyone. On behalf of Dolat Capital, we welcome you all to the Q3 FY'24 Conference Call of IRCTC Limited. I know there is a delay in the call, and we apologize for that because of some technical reasons, we could not avoid that. But now without wasting any time, I just take this opportunity to welcome the management of IRCTC represented by Mr. Sanjay Kumar Jain, who is CMD of the company; Mr. Ajit Kumar ji, who is Director, Finance and CFO of the company. And also, we have today with us Dr. Lokiah Ravikumar Director of the Catering Services; and Mr. K. K. Mishra, the Director for Tourism and Marketing segment. Now I would like to hand over the conference over to IRCTC management to take the proceeding forward. Over to you, Mr. S. K. Jain.
Thank you, Rahul. A very good afternoon, to everyone, and a warm welcome to you all to this conference call of IRCTC quarter ending December 2023. I extend my warmest wishes to you and your family. Just to add that I have joined as a regular CMD of IRCTC [indiscernible] what an opportune moment today.
The company has announced the unaudited financial results for the third quarter of financial year 2023, '24, which we have disclosed yesterday study on both the stock exchanges. I shall first give a consigned overview of Q3 [indiscernible], our Director Finance and CFO will provide the details of the performance of our business segments. Thereafter, we shall have the question answer session as per your convenience.
During Q3 this year, the company, I'm really happy to announce that the company achieved a remarkable milestone with our operating revenue reaching to INR 1,118 crores marking highest ever quarterly revenue, implying a growth of more than 20% year-on-year basis, 21.8% and 12.4% Catering and tourism have been the main drivers for this revenue growth. EBITDA for Q3 is INR 394 crores in absolute terms, growing by 20.9% from INR 326 crores of Q3 last year, mainly due to the recent growth in Catering and Tourism business. The EBITDA margin came to around 35% similar to -- more or less similar to the last year and 36.83% compared to the Q2. Due to the change in the product mix and a lower margin Catering other verticals as compared to the Internet ticketing.
The company reported a net profit of INR 300 crores in December quarter of this year, making an increase of 17.4% in Q3 of the last year. Net profit also is the highest profit ever in the history of IRCTC.
[Technical Difficulty]
Am I audible? So as I told that the company reported a net profit of INR 300 crores as against INR 255 crores last year. The net profit also is the highest ever profit registered in the history of IRCTC in this quarter despite making a provision of INR 14.5 crores in Q3 on account of differential profit sharing for PPP plans in railway segment with [indiscernible]. I would like to conclude my opening remarks by conveying warm wishes to all our investors and wishing you all a very profitable venture ahead. Thank you for your continued support and trust in us. I shall now hand over the call to my colleague and our Director, Finance and CFO, Ajit Kumar, to brief you on the financial and segmental performance of the company. Thank you very much.
Good afternoon, am I audible?
Yes sir.
Ajit Kumar, Director, Finance and CFO,I hope that you are all -- hello?
Yes, sir, you are audible.
Now I will first give a brief overview about Q3 FY'24 results, post this [indiscernible] . [Technical Difficulty]
Hello? Can someone from management line -- can someone please confirm? Ladies and gentlemen, the management line has been disconnected. Please wait while we reconnect -- ladies and gentlemen,t. thank you for patiently holding. We have the management line reconnected.
Yes, Okay. So I'm Ajit Kumar, Director, Finance and CFO. So we'll start this to -- some of the remarks for this result. In Q3 FY'24, IRCTC experienced yet another quarter of robust revenue growth, marking another significant milestone in its journey a revenue of INR 1,118 crores grew by 21.8% year-over-year, and on 12.4% quarter-on-quarter basis. Consolidated EBITDA margin is more or less the same, that is quarter-on-quarter to 35.23% versus 36.83% and 35.49% year-on-year due to change in the revenue mix.
Now net profit of exceptional for the quarter came at INR 299.9 crores versus INR 255.2 crores in Q3 FY'23 and INR 297.67 crores Q3 FY'24. Now let us move to the different business segments of the company. In Catering, the Catering segment reported at 29.1% year-on-year growth in revenue, reaching INR 507.70 crores and a 17.6% increase on a quarter-on-quarter basis.
Additionally, it may also be noted that the Q3 and 9 months revenue in FY'24 is the highest ever recorded in the Catering segment. The EBITDA margin continued to show substantial improvement reaching 15.44% compared to 10.73% year-on-year. However, there was a slight decrease compared to the 17.21% quarter-on-quarter margin mainly due to changes in the product mix within the catering verticals as the prepaid trends revenue having low EBITDA has increased Q3 to INR 59.76 crores from Q2 to INR 207 crores.
The next vertical, the Internet Ticketing. This segment continues to demonstrate resilience amid conversion of reserves to a ticket back to the earlier ticket. During the pre-pandemic period. And revenue for the quarter was INR 335.31 crores, growing by 11.4% year-on-year and 2.39% quarter-on-quarter. The EBITDA margin for the quarter came at 83.02% versus 83.7% quarter-on-quarter and 84.15% year-on-year.
The next segment is Tourism as we have discussed. That segment saw strong growth in revenue for the quarter at INR 195.47 crores implying a growth of 42.2% year-on-year and 21.11% quarter-on-quarter. Given the revenue growth, the segment reported positive EBITDA margin up 12.10% versus 3.3% on quarter-on-quarter and 10.79% year-on-year basis. The other segment Rail Neer in Q3 FY'24 reported revenue of INR 83.76 crores, marking a sequential growth quarter-on-quarter of 7.39% and year-on-year increase of 6.05%. The reported EBITDA margin stood at 13.43%, representing an improvement compared to both year-on-year figure of 11.20% and quarter-on-quarter figure up 12.43%. However, the segment's quarterly profit saw a negative return of minus INR 3.3 crores, contrasting with the previous quarter profit of INR 8.8 crores. This decline was primarily attributed to an adjustment of an exceptional item amounting to INR 14.51 crores in this quarter.
This exceptional item involved a sharing of additional 25% revenue from the PTC Railway plan for previous year, which was accounted for in the third quarter. For Q3 FY'24, the cash and bank balances and the net worth of the company at the end of the quarter is INR 2,258 crores and INR 2,946 crores, respectively. That brings to the end of the opening remarks, and we wish you all the best. So now we can straight away move to the question-answer session. Thank you.
[Operator Instructions] Ladies and gentlemen, the management line has been disconnected.
[Technical Difficulty]
Ladies and gentlemen, thanks for patiently holding the management line reconnected.
Am I audible now?
Yes. The first question is from the line of Jinesh Joshi from Prabhudas Lilladher Private Limited.
Yes. Sir, my question is on the Catering business, which reported a very strong growth in this quarter. So was it due to higher purchase booked on [ FPR ] basis? Or did we get more NRC contracts in this quarter? If you can highlight on that. And also a related question is we had plans to expand into the non-railway catering business. So if you can share some progress on that lines as well.
Sure, Jinesh. First of all [indiscernible]. Am I audible?
No. Sir you are not audible. There is a little bit disturbance from management side?
Now I am audible? [Foreign Language] Am I audible now?
Yes.
So I'm seeing 2, 3 reasons for the increase in such a robust Catering revenue announcement. First is introduction of Vande Bharat train as against the announcement of 75 Vande Bharat trains, this year, already 41 trains has been announced and running. The old contract which expired was around 1,200 has now increased to 1,518 contracts, to be precise. And [ FPR ] I also increased, and FPR is also giving us revenue because of that policy that now all the catering to the FPR will be done by IRCTC.
Yes you're right that because of that also is adding to our revenue, and it will further add to our revenue. Then you talked about NRC. NRC also, we have -- like this year only, we have already started 8 NRC projects, 7 are in pipeline, and they are mostly government offices, high court, et cetera. In addition, we have tied up with Zomato also as an aggregator -- food aggregator. Below that, we are on to more than around 400 stations. We are providing e-catering services, whereas we have direct contract with around 480, 490 vendors. Aggregators also -- we are eying aggregators like Zomato. And recently, they have onboarded on to our system.
Till now, we have 70 such aggregators are with us. So all these reasons lead to the growth in Catering. One more thing which I want to add that recently Ministry of Railway has announced a new catering policy. Basically, it is a [indiscernible] to the old one, wherein a new concept of this cluster base catering is announced. We have already floated some of the tenders, and we are going very aggressively towards that. This will be -- the main highlight of the tender is this is a long-term tender. It will be given for 5 plus 2 years. That's all.
Sure, sir. Related follow-up is that, you mentioned that the current contracts are roughly at about 1,500-odd. So if my memory serves me right, I mean, in the last quarter, I think we were at about 1,300-odd contracts and the opportunity size was 1,500. And given we have already reached that number, do you foresee a catering revenue plateau out a bit from here on?
No, no, no. It's a very good question. And I can understand your worry, but it's a matter of [ why. ] You know that we are in the sector largely our catering is all our business is in railway. As you know that railway is growing, growing, growing. With DFC coming, the line capacity of Indian Railways is further get released, and there is a huge demand from passenger side. So once the passengers are there, they need to drink, they need food to eat that IRCTC provides, and they need tickets, which we issue. So we should try to [indiscernible] as much as we can.
Okay, sir. And my second question pertains to the additional provisioning that we have taken with respect to share in profits in our Rail Neer business. So our press release states that the incremental provision is taken until FY'23. So do we expect some additional provisioning crop up in future from here on due to a higher share, which we need to give to Indian Railways?
I'm not able to hear to you, kindly repeat the question. There was a disturbance.
Sir, the provisioning in this quarter that we have took approximately INR 14-odd crores with respect to sharing Rail Neer profit, our press release states that we have taken provisions till FY'23. And for FY'24, do we expect incremental provision come through from here on?
No, no, no. It's already provided. You see, there are two things in this, which I would like to explain it to you. You see the departmental Rail Neer plan we had to share revenue with Railway at the rate of 15%. But all the plans which are on PPP model, the revenue sharing is 40% of our profit. So earlier what happened, we calculated 15% and INR 14.5 crores is the grand total of the difference of 40% of profit -- it is basically net of the profit of 40% is 15%.
Sir, I understood that. Actually, the worry was that this difference in profit, which you have provided for, you have stated in your press release that this has been provided for up till FY'23, which is 31st of March 2023. [indiscernible] 9 months, will we have to provide more? That was my question.
Up to December 2023, PPP sharing has already been made at the rate of 40% in this quarter.
Sir, one last question from my side if you can...
Apart from provision of INR 14.5 crores up to March '23.
Okay. Maybe, sir, I'll take this offline. I just have 1 last question. If you can share what is the convenience fee and number of tickets booked for the quarter?
This financial year?
No, sir. Only this quarter, the convenience fee and number of tickets.
Quarter is 140. This AC class is INR 550 lakhs, non-ac-class INR 456 lakh. And second sitting is INR 140 lakhs for this quarter. .
And convenience revenue?
And INR 219 crores is the convenience.
INR 219 crores, right, convenience revenue?
INR 219 crores is the Q3 convenience fee.
And the next question is from the line of Rohan Nagpal from Helios Capital.
I had one question on your Catering revenue expenses, there is one line item in the income statement.
Rohan, can you please speak louder?
Am I audible?
Yes. Yes. Sure.
So I was saying, within the -- so on your income statement as a line item that expenses for expenses of catering services. Now that the expenses of catering services, if I look at it, it's INR 348 crores or INR 349 crores, but that is not the same as the difference between your Catering segment revenue and your Catering segment result. The Catering segment result is about INR 78 crores, Catering segment revenues of INR 508 crores. So what all is covered in that line item, the expenses of catering services and what are the other expenses within catering services that you are incurring?
No, no. This is operating profit. This Is absolutely directly linked to the Catering -- whatever we earn the revenue from the Catering and it's the net of the direct cost, which is there.
So what all is rolled up in that INR 350-odd crores in your expenses of catering services?
See that is reimbursement of catering charges in the [indiscernible] and the railway share on the licensing.
Got it. Okay. All right. And I think this was a question that was asked earlier as well in terms of what -- so I was just wondering on Catering revenue in terms of the trains, how many more trains are there that are expected to -- that are still under the old Catering policy? And how much runway for Catering revenue increases there on the train side?
Do you mean to ask that the old Catering policy, how many mobile units are there and as per the new policy?
Yes, exactly. So how many trains are yet to move to the new Catering policy or yet to be transitioned?
100% has to be moved to the new one. See because the policy has recently come. We have already started floating the tender. So at the moment, all our earlier contracts were short-term tenders.
I understand that. But at [indiscernible].
And as of now, most of the tenders are up to 6 months.
Okay. So are all trains that are currently regional under the new Catering policy? Or there are still trains that are yet to sort of move on to the new Catering policy?
Actually, this new Catering policy has recently come as I told you this is a -- again, I'm repeating that we have just started tendering process. We have floated a few tenders, not yet finalized.
Okay. So then for how long will it take for the tenders -- for tenders under the new Catering policy to be applicable across the trains? Is there some sort of penetration number that you have in terms of there are x number of trains. And of these, y are currently on the new Catering policy around the tenders that have under the new Catering policy?
All the tenders -- all the trains which we are running at present and all the trains which will be coming. We are -- say we are having around 1,200 trains at the moment, putting all together. So all these will be put on the tender. And this will be a long-term tender because the size is quite large. We are aggressively following to finalize as we [indiscernible] In fact, let me -- and we have already decided the phases about this.
And the next question is from the line of Ashish Sreekumar.
I just wanted to ask a question about the Zomato eatery the digital eatery that you were talking about. Could you specify like what -- how much has it grown? Because the Catering service you said grew because of the number of trains Vande Bharat inclusion. So what forecast are you thinking in the [indiscernible] in the coming days, how much is it going to grow?
Ashish, let me tell you how I fell. Number doesn't matter.
Hello?
Am I audible?
Now you are audible, sir.
Yes. Ashish, if you want, I can give you the number of we are already there on [ POC ] concept, and we are at 18 stations now. And we are going on 22 actual stations, but the number doesn't matter. Ashish, what I see is to make -- to create a framework, to create a network so that first we put the system in place. And then you -- with your extent of the network, you create a stability in the market and confidence in the customer. That's what we are presently looking for.
Okay. So I believe that first, we are plumbing the entire structure first and then basis that will increase the numbers. I got your point. Yes. And one final question, sir. You might have seen that ONDC inclusion has been included a lot. And ONDC has also gotten into the eatery services through different aggregators. So is ONDC also coming into the ticket booking section for IRCTC? Is IRCTC planning something of some sort? [Technical Difficulty]
Ladies and gentlemen, line for the management have been dropped. Ladies and gentlemen, thank you for patiently waiting. The line for the management have been reconnected.
Ashish, we were discussing about ONDC. So our discussion is already going with them.
Okay. So any projected time lines by when you are foreseeing there could be an inclusion of ONDC IRCPU?
It will be too early to say, but we are trying.
And the next question is from the line of Madhuchanda Dey from MC Pro.
I have two questions. One is the same question on the Catering, I was not very clear. You mentioned about a figure of 1,518 contracts. So that is the potential number of contracts that you have? And how many contracts have you already won or you're already present? If you can clarify that number.
Yes. This number is already under short-term tenders.
1,518?
Yes, yes. These are short-term contracts going on. what I was telling that a new Catering policy has come for long-term tenders. At present, we are having a contract of maximum 6 months. The new Catering policy prescribed for 5 years plus 2 years contract. And for that, we have decided to go in 5 phases and complete the tenders.
Okay. Got it. There's absolute clarity on it. So my question is, is there -- what will be the number of trains where there is a pot -- given the existing inventory from Railways, where there is a potential for catering where you are not present. Are there any number of trains where there is a potential for catering and you are still not present?
Largely, we are present in one or other form. You see one he is on the train. If he is hungry, he needs to be provided with a meal, that we manage it in 3 ways. One is long-term contract; another is short-term contract where there is a gap, which will lead up to short-term contracts; third is TSV, train side vending we get it done. And there are certain trains which are not having any pantry cart. So there you will be interested to know e-catering is also there, then we have food plazas all across the country besides the refreshment tool. So we -- there is no place where we are not going. The question is, if we put them for 5 to 7 years in place of 6 months, it is certainly -- it will give us confidence in the market for -- see there will be stability and revenue growth on our part.
Okay. But if you gave it to them on a 5 to 7-year contract, in terms of pricing, will you have to give some concession compared to the short-term contracts?
Madhuchandan, this is other way round.
Okay. Sorry. Can you come back again?
What I feel it will be other way round.
Other way around. Okay. Got it. Got it.
There is -- the pricing is controlled by ministry. But the transitional fees what they are expected to pay, if they are -- they have the surety of a longer-term contract. So their fixed cost, I believe, their fixed cost, they will be able to manage, and that's how they can share more profit with us.
Okay. Got it. Got it. And sir, on an organic basis, what kind of growth should we expect in the catering revenue in the next 2 to 3 years?
Should I give the numbers? Or should I give the general idea?
I mean the number would be more than welcome.
Number is, If I say, infinite. You see, we have 2 crores people traveling on our system on Indian Railways every day. what we are providing here is around 18 lakhs, 20 lakhs of meal per day. So the number is huge, as much as I can take it.
Okay. I mean, sir, I have another question. So which is a little kind of if you can guide us with some numbers. So as of now, you have about -- you sell about 46 crores roughly ballpark in that range internet ticket in a year. So given the plan...
Just a moment. Just a moment, what's your question?
As of now, you sell about 46 crores Internet tickets, roughly may not be the numbers. So given the Vande Bharat and other additional plans for introduction of new trains, et cetera. What kind of organic addition to this number can we expect?
You see, just now I told, that Indian Railway infrastructure is growing very fast. DFC has already come. It is creating like a capacity enhancement in the railways in a big way for the passenger train. They are already in the CapEx -- they are investing a huge amount in the CapEx in building the infrastructure and building the rolling stock and all. So the question is what -- the question is not what is the growth. The question is how much we can capture. Economy is also growing. And what I believe and we all believe that the next 25 years of India. So we are planning according to that.
Just asking for my curiosity one simple number, one additional Vande Bharat train leads to what kind of annual capacity in terms of tickets?
One Vande Bharat -- there are two kind of Vande Bharat. There is one Vande Bharat which has the capacity of 543 people with 8 coaches and another one is around 1,000. So 1,100 and 540 depends upon the train in running with how many coaches. Per day, per train, one side, because Vande Bharat goes in the morning comes back in the evening. So if you multiply by 2, so in a day, 2 rounds it has taken. One round it has taken means 1,100 into 2, 2,200 passengers travel everyday.
But then all Vande Bharats don't travel every day of the week also. So ballpark...
No it runs for 6 days, not for 7 days.
Okay. So ballpark, you mentioned, right, that there are -- there was 75 Vande Bharat announcements and 45 running. So out of -- so with this 45 running, what is the additional ticketing capacity that you have seen?
That we can calculate any day. We have like 543 or 1,100 into 2 into 300 days, we can say. And what I'm trying to say is that you not only see on Catering part, you see the Ticketing, you see the Rail Neer. You see even Tourism.
Got it, sir. Got it, sir. So that's the kind of...
Any addition of Vande Bharat has a multiplier effect on IRCTC and it's services.
And the next question is from the line of Rahul Jain from Dolat Capital.
Yes. My line is audible?
Yes.
So I just have a couple of questions. Firstly, on the Rail Neer business, we have saw this exceptional charge. So it would be great if you could give some feedback that where -- why there is this ambiguity of earlier having this 15% versus 40% now. And it's just a provision when we expect this to be conclusive for the future as well.
Should I start?
Yes, please.
You see, as I explained to you earlier, initially Indian Railways and IRCTC, both thought to run the plant -- railway plant on departmental basis. So there was a decision that in a departmental [indiscernible] Rail Neer charged 15%. But as the necessity was there, market was growing, it was not possible to create capacity to the expectation. So IRCTC was allowed to go on a PPP model. So that time, they could not visualize that should we take it as per the departmental procedure or through PPP model, which is available in all other like Food Plaza and all.
So now it is a settled issue that any PPP will be treated as per the sale loan. Loan was already existing. But it was a matter of interpretation earlier. Now it's very clear. And there is no ambiguity, and this is conclusive to you now. IRCTC is not losing anything. You see, we are earning say, 100, we are giving 40 out of that. So 60 is the net inflow to us. But that way, we are able to create additional capacity in the shorter period.
Right. But essentially, this chart never used to exist prior to FY'22. But at the time of IPO, we already had this plan. So when this rate effectively got implemented?
You see, it is done at the ministry level. And what I'm saying is, if we had to expand -- and there is already a norm of 40% on PPP project. So why IRCTC will not pay I have a different question rather. If we pay 40% in place of 15% is able to grab the market. So at least in absolute term, we'll be able to manage getting more revenue than what we are doing now.
No, I can understand your stance, sir. My simple question is, because all of these charges, which are levered by -- in the Railways at different point of time, creates the uncertainty in terms of what kind of revenue -- what kind of profit would be retained in this listed entity. So is it safer to assume that all such changes which are relevant because we are significant beneficiary from Indian Railways. And at the same time, we have a large opportunity to capture. Is it safer to assume all such [indiscernible] changes?
Can I?
Yes, please.
What I understood from your question, and it's an important question. But what I understood that it would have been better for IRCTC to first clarify on this and then do the business. Whereas we thought that the management wisdom was there, then let us start aggressively. And all these things, we are not giving anything from pocket. We are just sharing the profit, which otherwise normally is there.
And these kind of -- when we are running contract, it's a business entity and a shared business also rather wasting time fighting with Railways first and then decide and then do the addressable the market, it will be always advisable that we should go for the market and side-by-side, we talk to them. And then absolutely, there is no uncertainty. It is a matter of interpretation, and that has been settled now.
Yes, I can understand that aspect. Just one incremental input I was just saying. Since you said that it is in best interest for us to look forward, is it safer to assume for all the businesses that we are doing today, whatever is the sharing arrangement today is something which can be sustainable how you think at different point of time, something may come up, which we can't predict at this point?
You see the -- if I answer your question like this, the life expectancy in India is 80 years -- 79 years. It was 52 or 59 years. Now it is 79 years. So it doesn't mean that you will not fall sick. So you will take medicine and then move on. so that you achieve that life expectancy. That's what I can say.
Sir, just to add to your point, the analogy -- whatever business problem you would face from the market, is equivalent to falling sick.
We have to go on. We cannot...
We just have to understand is that sickness would be coming from our parent or is it will be an external sickness?
You see every parent gives his son or his ward or his descendent the certain inherent diseases, but the son or the daughter, the descendant's theory. And if you see, [Foreign Language] We all have reached to that level. So there be clarity when we are growing together, there we can't say in a very inverted commas that there will not be any problem, there will not be any interpretation issue, will remain there. But the main thing that I see as a management here is how we grow and we grow together to the satisfaction of the customer and to the investor that way.
Understood. That's very helpful in terms of getting the interpretation of this thing. Just last one aspect. We've been providing this UPI incentive to the user who will do ticketing through the UPI mode. And there's a significant subsidization on that aspect. Is there any time line that we have decided as how long we would offer this to our customer or is this going to be permanently?
See, this is UPI -- promotion of UPI is government directive and as a citizen of India, as a response when we are talking of importance sustainability, we talk about everything. So this is a green project of India, which is taking India to a different level, we can't have the left line. So we have to promote it. And we can find out many other ways and links to the like to enhance our earning. So what I feel that we should not restrict ourselves in such a conservative side of thinking.
Right. But do we have any other precedents in India who is promoting this UPI incentive in such a big hearted manner?
You see somebody has to take the lead. If I am taking the initiative, you should be happy that the management here in IRCTC are right to the occasion.
Sir, my only point is that it was well understood 5 years ago. But since that the 67% of all volumes in India now happens on UPI. It's fairly acceptable medium of payment. So do we need to promote it beyond this point as well?
What I see time is a learning process. We cannot -- the cycle -- the time cycle may differ for 2 years, 5 years, 10 years. You see, 10 years before, we could not have thought that the India will become the fifth largest economy. Now we are daring to think -- to reach the third largest economy, in the 10 years itself. So what I feel that time should not be -- like we should not be bound by time [Foreign Language]. We should progress. We should see how we can progress further, how can we add to our revenue, how can add to our profit. And there are very various means and ways to do so. You see after giving this concession also, just now we told that we are happy to announce that this was the highest ever revenue in this quarter.
And the next question is from the line of Devang Bhatt from IDBI Capital.
Am I audible?
Yes.
A few bookkeeping questions. Like what is the current Rail Neer plant capacity? And what is the utilization? And what is the...
Utilization is 75%. And capacity is around 18 lakh. We are adding to its capacity by 72,000 [ ticket ] plants. In fact, one of the plants is going to be inaugurated in the next -- perhaps few days. [indiscernible] I think tomorrow? Tomorrow. Another plant by July. So we are enhancing the capacity. Our utilization is 75%. There also, we are enhancing -- planning to enhance our capacities because you see, there are certain plants which are running at more than 100% capacity. There -- when we are adding another capacity -- add-on capacity, and we are coming with the new plants also. So that's all.
So sir, how much your capacity will increase by FY'25 and beyond?
1,840 is like 18.4 lakhs [ bottle ] per day.
So that is the current capacity, right?
No, no. Current is 16.96 lakhs. Already Rahul will tell you current is 16.96 lakhs, will announce to 18.4 lakhs as of now, that '25 is like a long period for me. So let's see.
So 18.4 lakhs by FY'25 by this year or by next year?
As on date, there is a plan of -- by 2025, 18.4 lakhs of bottle per day. But what I see is we are sitting here in January, February 2024. So we have time to think it again.
And sir, in this quarter, what drove your Tourism revenues, I mean, what was the key driver? And how many additions of stages are expected in the coming quarters?
You see Tourism, we have a very good product Vande Bharat train. So Tourism business, let me explain it to you. We are basically tackling to rail-based mass tourism. And Bharat Darshan train -- Bharat Gaurav train, 11 such -- 10 plus 1 Bharat Gaurav trains we are running.
And Secondly, interesting part is that recently only, we have an MoU with Uttarakhand Government, I think in the last week itself, where we had a contract with them for 2 years that we will promote their tourist places, and they are investing into the Bharat Gaurav race and we'll be booking it through [indiscernible] and we are talking to some other state government also like Maharashtra also, we are -- because it is in a lesser state, I should not talk about the state, but we can just say that these are the 2 projects. One is the MOU with the state government catering to mass tourism and promoting their state tourism and Bharat Gaurav Train.
Okay, sir. And this MOU with Uttarakhand what kind of revenue it will generate for you?
[Foreign Language] It will generate good revenue.
And sir, in Tejas, what kind of additions are you seeing?
It's not a concept of revenue my dear. It's what I see is that if we are opening something -- so there are many certain states are there, which want to promote their tourism. So if I say that if I take -- like if you say that in the next 3 years, we are having I think more say 10 or 12 state government. So it will generate huge revenue. So I see the potential. I'm not calculating the absolute terms.
That was the last question. I would now like to hand the conference over to management for closing comments.
Thanks to this -- after this quarter 3 results, which is one of the highest turn for the 9 months and 3 months this quarter. And especially talking to the investor gives us confidence and whatever the suggestion we take it forward it's your company, and we look forward that in the next quarter, we do much better with your best wishes. Thank you. Thank you very much.
On behalf of Dolat Capital, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.