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Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
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Thanks, [ Faizan ]. Good evening, everyone. On behalf of IDBI Capital, I welcome you all to IRCTC's earnings con call for the fourth quarter and year ended March FY '20.I apologize for the inconvenience caused because of the slight delay on the call. On the call from the company, we have the management represented by Shri Mahendra Pratap Mall, Chairman and Managing Director; Shri Ajit Kumar, Director, Finance. I'd like to thank the management for giving us the opportunity to host the call. I would now request Mahendra, sir, to give a brief on the company's performance for the quarter and the full year, post which we shall have the Q&A session. Over to you, sir.
Good afternoon, ladies and gentlemen. I mean we had our accounts passed today by Board of Directors. And as you are all aware, last quarter result, which we have finalized today. Of course, this impact of corona was held maximum on hospitality sector and travel sector. And we -- our business is primarily travel-oriented, whether it is train booking, air booking or catering, packaged drinking water. So quarter, I mean, if I mentioned about last quarter, quarter 4, the total revenue was INR 607 as against INR 734 in quarter 4 of '20. So there was a -- yes, sorry. I mean for fourth quarter, total operating revenue was INR 587 crores as against INR 498 of last year. But there was a drop in the catering, and it was INR 236 crore as against INR 295 crores. Rail Neer, similarly, was 51 against 43. This was primarily on account of more -- commissioning of more and more plants. Ticketing was INR 194 crores as against INR 66 crores last year -- last quarter. It was primarily on account of imposition of service charge in September onwards. Tourism there was an increase of -- from INR 83 crores to INR 102 crores. And total revenue state sales has gone down from INR 11 crores to INR 4 crores, and total operating revenue was INR 587 crores as against INR 498 for quarter 4. But now more important is the annual results. So as far as annual result is concerned, our total operating revenue has gone up by almost 20% from INR 1,870 crores to INR 2,275 crores, which is an increase of 20%. And overall, profit has gone up. The profit before tax has gone up to INR 745 crores from INR 479. And PAT has gone up by -- PAT has become INR 524 crores against INR 308 for last year, which is an increase of almost 70%, so increase in turnover of 20% and PAT of 70%. This is primarily on account of imposition of service charge on Internet ticketing, which has given this kind of profit. As far as dividend is concerned, your Board -- I mean Board of Directors, they have declared a dividend of 125%. That is INR 12.50 per share with a face value of INR 10, out of which 100% has already been given as an interim dividend. So INR 2.50 more will be given. So that is all. Now I am open for any questioning.
[Operator Instructions] The first question is from the line of Nitin Gosar from Invesco Mutual Fund.
A couple of questions. What would be the online ticketing booking that happened for FY '20? And what would it be as a percentage of total bookings?
Online ticket booking on an average is about 8 lakh tickets per day. This was pre-COVID period, right? And this covers almost 72% of total reserved seat of Indian Railways.
Okay. Got it. Sir, second question is pertaining to what's the overall thought process when it comes to commencement of the operation to normalcy. I very well understand COVID is not the environment to -- or will not allow you to permit at the normal level. But what would be the thought process? What would be the key indicators, which will indicate that from here on, things will only improve in terms of staffing the services to normalcy?
I mean this is a question that much depends on the situation and further progression or reduction of COVID and in general atmosphere of well-being in the nation where people will start again traveling. So as far as ticketing is concerned, perhaps it will go up because people will avoid now taking tickets from windows, right? Tourism, yes, it will take some time because, I mean, as you are seeing today, people are trying to avoid travel. Or even if somebody has to travel, normally, they are preferring personal mode. So tourism may take maybe 6 months or a year from now to pick up. Similarly, catering also will suffer for some time because now there is a different and scaled-up new normal of hygiene. So maybe there is a talk that instead of this type of packed, cooked meal and all that, we could start more and more ready-to-eat meal but then acceptability of ready-to-eat meal in a long journey. This is always in doubt, ready-to-eat meals for 1-meal person can it but not perhaps beyond that. All that we are exploring. But yes, certainly, things will change not only for IRCTC but overall as a whole. And we are tuning ourselves to that kind of situation. Like, currently, our -- most of our hospitality supervisors and the staff, they don't have much of work. So we -- in association with ITDC and 2, 3 other professional agencies, we are imparting them a training of -- for next level of hygiene, next level of hygiene for customer and the protection for them also so that as and when a number of trains increase and volume increases, they should be in a readiness to handle this kind of situation.
But sir, to start the train operation, it will all depend upon the government's say? What I mean to understand is, is central government going to play a key role in asking...
Obviously, central government will also start the trains, increase the number of trains depending on the demand. Like, currently, I think 115 pair of trains are running. And the average occupancy is in the range of 60% to 70% roughly. So it means -- I mean it will take some time.
Okay. Okay. And when it comes to cost, how are we placed? Which are the fixed costs we can pull down? And what are the variable costs?
Fixed cost is in form of employee cost because it's basically like any service sector, it's not an asset-heavy organization. So basically, employee cost is more or less fixed cost. I mean a major part of it, 90% of it is fixed cost, 90% or 80%, so that will continue. And as a good measure, we don't have any major assets, just fixed cost. Our employee cost for the year total is about INR 200 crores. And out of that, roughly 20%, 25% -- INR 20 crores, INR 25 crores, which is about 10% to 12%, is again variable. It's basically contractual employer or outsourced employee that can be controlled. And another 10% cost is within -- which we can control. So that -- we are trying to do something.
Got it, sir. And sir, one last quick one, private train operation, which has been around in news for a week. Who will do the booking of -- who will do the ticket booking in private train operations?
I think it is mentioned in RSP that IRCTC will do the booking through the IRCTC portal. And obviously, business-wise also, it does not make any sense for any train operator to create a new portal and booking system, booking engine for 8, 10, 12 trains. It will not be viable for them. Their service is available at some nominal charges from another organization.
Right. Got it, sir. Would it be prudent for us to believe that right now, we are investing in servers to [ announce ] our booking capacity that may continue, and pantry car investment that we are planning to take up, that may take a backseat?
For some time, yes.
The next question is from the line of Manish Poddar from Nippon India AIF.
Just on this capacity, which you said 115 pairs, so would you be able to help -- this is how much of the total? So I'm just trying to understand, I think the deadline until August.
You are talking about private trains?
No, general trains. So right now, when you're running -- booking for 115 pairs of trains, how much is this of the total capacity?
This is around 10% to 12% only.
Okay. So right now, let's say, until August, running at...
10% to 12% of reserved train category. If you take overall the passenger and suburban train, it will not be even 2%. But we normally -- we are booking only for reserved category, reserved trains. So it is about 10% to 15% only.
Okay. And another question is, during this lockdown or unlock, there have been certain different mechanisms. First is on the ticket booking, probably which has been done by the center. And second is on the meal and water being provided in this interim. So probably, could you explain how does this mechanism work? And does it -- does any part -- what is the pricing for this? Just trying to understand, do we incur any loss-loss in this business? Or is this a no profit-no loss business?
Let us take business one by one. Which business? Ticketing, you are saying?
Yes, the 3 businesses: ticketing, catering and water.
In any case, we have our software, we have our servers in place and system is already working. And manpower is also there. So whatever booking is done, it's revenue for us. It's not a loss-loss situation for us. We are getting revenue out of it. Out of that, fixed expenditure only. There is no variable expenditure linked to -- I mean hardly any, 2%, 3%, 5%, maybe maximum 10% variable expenditure linked to ticketing.
And how about food and water?
Water is -- sales volume is low. This may -- what we do, we have -- since the food is not normal food, we have invited temporary tenders to -- for these trains. So we get a license fee. And then our condition is that will cooked food will not be served in the trains. It will be only packed and ready-to-eat branded meals and Rail Neer. That is being sold by them on which they earn a margin and give us license fee, which is decided on a transparent bidding process.
Would it be fair, let's say, just on this water and the food, whatever margins you were clocking will be similar now also?
In volume?
Yes, volume and ticket sales would have come down, but the margin -- so let's say, instead of giving 150 meals, you are now giving, let's say, INR 50, for instance. But 10% was the margin earlier, which is the license...
Earlier, all the 3. All the Rajdhani, Shatabdi, these were prepaid trains where food was part of the fare. Now there is no such train, everything is available on sale, right? So margin-wise, whatever our PPP partner is getting, but he is giving a license fee out of that, which is much less compared to a regulatory.
Okay. And just one final one. Is that -- these trains, which you were running, the Goa one and the one up in Delhi, so how does the economics work right now? Because I believe these trains will not be running. But do we incur the fixed cost for running those trains still?
We have taken these trains on lease from Railways. And in the light of force majeure issued by Ministry of Finance, we have requested Railway Ministry to waive the lease charges as the services are not there.
Would you be able to tell what period is this for?
What?
This force majeure by Ministry. So this will be applicable until the government...
Until the trains -- until there is a demand for train, until the train operation starts.
The next question is from the line of Jinesh Joshi from Prabhudas Lilladher.
Sir, I have one question on the license fee catering business that we conduct. Now if I understand it correctly, the licensee paid the money in advance. And in a lockdown, obviously, the sales would be negligible. In fact, even after the operations begin, the sales would be quite low in the initial few months as there's tendency to eat out maybe a bit less. So basically, what I want to know is that will we have to compensate the licensee in any way for this period? I mean for the advanced money which we have received. Or will his term be extended? So basically, how is the nature of the investment...
What we have done, since we have collected the licensee fee, by offering him an opportunity to sell meal in trains, right? For the lockdown period when there were no trains, we have -- and we had to -- because a licensee also has to maintain a minimum of permanent staff on roll for them. So what we have done, we have returned the license fee, which we had collected in advance for the lockdown period. Although that -- his liquidity is insured for payment to his staff. That is number one. But the moment normal services are restored, he is supposed to pay the license fee, return the license fee within 1 month. And if he pays within 1 month, his contract will be -- also be extended by the same tenure. But if it does not return it, then contract will not be extended. And now that during current period when the sale is much less, obviously, nobody will work on that licensee. So for that period -- for this period when, of course, our entire terms and conditions of the tender and contracts have changed. So we have invited fresh bids for a limited period of 2 months, extendible by another 2 months, for serving this -- for doing this limited service of these special trains which are running currently because these are not trains with those numbers for which tenders or contracts were signed.
Fair enough. Fair enough. And sir, secondly, in case of tourism business, what I want to know is that, is there any minimum guarantee component that we have to pay to Indian Railways or the haulage charges are paid on a usage basis? So I mean, basically, if -- will there be any cash outgo for us until the time our tourism operations are shut? That is what I want to know.
Haulage is payable for the trains which we run. That is Maharaja Express and Golden Chariot we had taken and these 2 Tejas and 1 Mahakal Express, right? So as far -- as I mentioned in reply to earlier question, we have -- there are 2 types of fixed costs. One is the lease charges on which Railways has given the rolling stock to us, and haulage has a fixed component and a variable component. We have requested Railway Ministry to waive the fixed charges as well as lease charges, treating it as force majeure.
Okay. Fair enough. Sir, one last question. With volumes of ticket falling during lockdown, has the deposit that we maintained with Indian Railways has also come down correspondingly?
Yes, certainly.
Okay. Okay. Sir, can you share the figure? What was that figure as of March and what is it today?
Yes, pre-COVID, let us not talk of much, pre-COVID, we were issuing tickets worth about INR 60 crores per day, right? And this money used to come back to us in T plus 2 days, but we -- and we had to keep a margin of 1 day. So we are maintaining a balance of almost INR 300 crores with Railways. Now this has come down to almost INR 13 crores, INR 14 crores per day. So we would be maintaining a balance of about INR 60 crores, INR 70 crores with Railways.
Okay. Okay. And just the privatization opportunity that is being spoken about, will we be required to invest in the rolling stock or our participation will be limited to just managing the operations, what we are doing currently?
It depends on what model we adopt. Obviously, nobody -- whether we tie up with anyone -- because our expertise is in operations, there has to be another partner whose expertise or who has knowledge of rolling the stock and maintenance of rolling stock. And then in every business, some financier comes in, either IRCTC comes as a financier or rolling stock manufacturer comes as a financier or third-party comes as a financier. So it will all depend on the structuring that we go for. It is still not decided.
The next question is from the line of Rahul Jain from Dolat Capital.
Yes. So my question is for the Rail Neer business. So what are the dynamics now here? Because, of course, the volume has come off, volume would have come off significantly, so how we are compensating the PP partner? And what are the fixed costs that we have to bear on these plants?
In our PPP contracts, there is a clause where is -- whereby we give them a commitment of picking of certain volume of water. If picking -- if sale or picking of water from that plant is above that, we give them incentive. If it is below that, we -- there is -- mechanism is already there in the contract with them. Then we compensate them. For the volumes, which are not lifted, per bottle, there is a compensation. There is a mechanism. So we will pay for that.
Okay. And what could be this component on an overall basis, annual basis?
I mean it will depend how long this situation continues. It will depend how much less water we are able to lift from the plant.
Right. So let's say, this INR 170-odd crores of annual cost we have in Rail Neer business, the significant part is toward that fixed INR 5 to INR 6 that we pay towards the procurement.
Yes.
So that part reduces with the volume. But as a percentage, this bare minimum cost that we need to cover up, is that a significant number? Or only...
It will not be significant. It will be -- how much per bottle? Compensation of -- it is not significant. It's -- I think INR 0.10 to INR 0.12 per bottle.
Okay. Okay. So that's quite lower.
It is quite lower because we have given him the capital support for setting up a plant also. And for the lockdown period, we will extend the contract also by that period. So all those care, we -- that care we are taking to make these contracts operational and not exploitative.
Right. And so you obviously gave idea in terms of some cost. So right now, we have INR 400 crore quarterly cost. And you said the big part of the fixed cost is the employee cost, which is INR 200 crores.
Yes. And out of INR 200 fixed costs, it will be about INR 170. With employee also, there is a variable component, contractual employees and all. Of course, we have not -- we continue with all the employees. But yes, certainly, once situation improves, we will review it. But fixed component will be anything between INR 170 crores to INR 175 crores.
Right. Sir, right now, we have this opportunity to save maximum INR 30-odd crores in the overall cost basis. Is there any other nonemployee-related costs where we could deploy some cost-saving measures?
Yes. What we have done, we have -- I mean, for future, we have done an analysis. And all the controllable portion, we are trying to control. As I mentioned in answer to one of the questions, we are not asset-heavy organization. So many things are controllable, and we are trying to reduce. And majority of our cost is directly revenue linked.
Right. And just last one bit from my side. In terms of -- of course, Rail Neer business, catering business and Internet ticketing business can pick up the moment more train starts based upon demand and the COVID situation. But tourism, which is more of a discretionary thought, so how long do we see some resumption on this? Or have we completely taken out all our plans for this fiscal in terms of all these trains that we -- luxury trains that we run? Until what period we have already canceled the travel plans?
This luxury train starts sometime in October. So we have not canceled it so far, but we have -- we will see until August. And then maybe close up to December, we will cancel month by month. We will not cancel the entire year at one go. And then we'll see how the position improves here. I mean this is something which nobody is able to predict.
Right. And people have option of a complete refund at any given point.
Yes. Yes. All that flexibility we are giving.
The next question is from the line of Soumitra Chatterjee from Spark Capital.
I have 3, 4 questions. The first one is, the trains were canceled from 15th of March, but when we refund the bookings, do we have to refund the Internet ticketing charges also or that is not to be refunded to the passengers?
No. Because ticketing is a service extended. Travel takes place or not, service of ticket booking has been given to the passengers. So that convenience fee or service charge, whatever you may call it, is not returned.
Okay. Now until about 1st first of September, when we were not charging -- 1st of September 2019 when we were not charging the convenience fee, the government was reimbursing IRCTC to the extent of cost for this decision. But if this situation extends, the cancellation of trains, I mean, extends further beyond 12th of August, then does the government be -- is there any clause that government will be reimbursing for the cost of this decision? Because we are not booking any ticket right now, so there are no revenues per se, I mean, other than the 115 trains that are running.
No, I don't think it will be proper for us to ask government for this because this is a business risk. I mean at that time, it was government's instruction. Now there is a business risk, which all businesses are facing.
Sure. Sure. And sir, if you can just update us on, until about February, what was the revenue and the profitability run rate of Tejas Express, both of them, the Lucknow-Delhi, Mumbai-Ahmedabad and the Mahakal Express also? Until about end of February, what was the revenue and the profitability?
We started with Lucknow-Tejas in October, the projection was that we will break even in year 2. But these trains ran until about middle of March, 15th to 16th March, until we had closed. Until that time, it was about to reach the breakeven, right? Mumbai had done just 1 month. Mumbai was started on 14th or 15th of -- 17th January. So it ran for only 2 months. But yes, that Mumbai response was much better, and it was also nearing breakeven. Mahakal also ran for only 15, 20 days. But all the 3 trains combined, as I mentioned, we incurred a loss of about INR 2 crore, but that was primarily on account of advertisement and marketing expenses, which has -- which was paper ads in inaugural run and all that. I mean if we spread it over the year, over 2 years, 3 years, perhaps we would cover it.
Sure. And sir, the last question is on the privatization of the trains, which is currently under the proposal. While any private operator will be using your portal to book the ticket, but the private operator is free to use his own people for the catering services, right, catering and water?
Yes. Yes.
Okay. Okay. And in this scenario, if you participate in this proposal -- in the scenarios you participate in this proposal, will IRCTC have to create a separate subsidiary? Because a new partner needs to come in for rolling stock, IRCTC will be there for operations and a financier will be there, will it be a different subsidiary altogether, which will be managing this particular operation? Or is it...
That is yet to be decided. There are various options. Even as IRCTC, I mean, we can always take rolling stock on lease from some financing company. Engage a company for maintenance services. Engage a company for onboard services. That is one extreme that we can do it. The other extreme is that we tie up with private players either as a joint venture or a subsidiary or SPV, whatever. It is still not decided. We are weighing various options. And then we will come out with whatever is felt best.
And sir, one last question on the catering side. In the month of January, the Railways has hiked the breakfast, tea, lunch and dinner charges. But from mid of March, anyway, the trains are not operational. Is there any plan to roll back the hike that was done given that majority of the trains, the government will be trying to lessen the cost of the -- passenger cost for the passenger?
There is no plan to roll back the cost. In fact, rates were revised sometime in month of November. And this was implemented for all the trains which are on postpaid where food is bought -- sold and bought. But in prepaid trains like Rajdhani, Shatabdi and Duronto, this was to be effective from 28th of March because there, it is part of the price of ticket. And ticketing is done 120 days in advance, so there was a margin of 120 days for implementing this revision. So in Rajdhani, Shatabdi, it was not implemented. There is no plan of rollbacks. But yes, I mean there is a change in perception about hygiene and all this. So we are working on it. Let's see what comes out.
The next question is from the line of Manish Oswal from Nirmal Bank Securities Private Limited. The next question is from the line of [ Diwan Singh ], an individual investor.
Can you hear me? This is [ Diwan ], and hope you and your family are doing good during the situation.
I hope the same for you.
Yes. Good to hear about the results. And I just wanted to know -- there are 2 things. First, obviously, there is no prediction of how much it will [ prolong ] in this COVID situation, but there are some [ ballpark ] situation, [ ballpark-ing ], which are -- that is this, that from next 1 quarter, 2 quarters, how much of your revenue can [ down or increase at ] given all this new analysis. And the second thing, is there any impact in CapEx plan for the future or any new ventures and everything or new tie-ups? Is there any impact on this due to this lockdown and there's no reason [ you think ]? So this is the 2 things, which I want to hear.
I mean first thing which you mentioned, I mean, frankly speaking, nobody, even the best of research institutes in the world are not able to predict, like this MIT study, which says that there will be 3 lakh cases per day in India. So one study is there, and then there's another study. ICMR made one study that there's a peak in November. So we are just tackling the situation as it is coming and we are trying to rationalize our operations in such a fashion that our cost minimization is done. And whenever we're getting any opportunity, we are going for that business. Your second question about CapEx, yes, it is -- partially, yes, some of the plans we have deferred especially relating to tourism where we had planned to buy 2, 3 trains for our -- this Mukhyamantri Teerth-Darshan Yojna and the State Teerth Special because of 2 reasons that, obviously, states' financial situation will also not permit them to promote this. And secondly, tourism as such will be most of it because we have deferred it. At the same time, some other projects like Lucknow Hotel, we have just bought a land at Kevadiya where Sardar Patel Statue is there and we got approval for purchase of land for a 4-star hotel in Lucknow today only. So such things are going on, which will materialize after some time. But CapEx, which was to result into business, in short, temporarily we have withheld it.
The next question is from the line of Prateek Giri from Emerge Capital.
Yes. Sir, I was just wondering that will it be possible for you to give me a breakup of this INR 1,264 crore revenue, which combines catering and Rail Neer. How much of it comes from Rajdhani and Shatabdi trains, sir? Will it be possible for you to give me a breakup?
Yes, Rajdhani and Shatabdi trains, there are 2 streams of revenue. One is the cost of food -- or price of food rather, which we supply, which our licensee supplies to passenger and then bills us and then we bill to Railways, right? That revenue is about INR 500 crores for all these prepaid trains. And second stream of revenue, when we invite a bid for these trains, these trains are allotted to bidder who has quoted the highest concession fee for 5 years. So there's a component of annual 5-year concession fee, which is paid in 3 installments. That is another component. So from Rajdhani and Shatabdi, INR 500 crore revenue is out of sale -- price of food and about INR 75 crores, INR 80 crores for all the trains. Rajdhani and Shatabdi, the number is on account of concession fees that we get for allotting the train to a particular bidder.
I get that, sir. Sir, my question actually comes from the fact that in next 5 or 7 years, if we assume that Indian Railways will outsource the Rajdhani and Shatabdi trains to private players, sir, is there any threat, which is hanging around our catering and Rail Neer revenue, which we are getting from Rajdhani and Shatabdi because these are the routes or these are the places, which we'll be forced to hand over to private players?
There's a slight misconception. As per current policy announced by Ministry of Railways, there is no question of handing over these trains to private operators. All the new trains which have come up, these will be additional trains. Of course, it will have some impact on the occupancy of trains. That is a different story. But right now, there is no plan to hand over these trains to private operators. That is number one. And on account of reduced occupancy, yes, we might lose something. But then we have our plans of entering into private trains, which will give us a much higher revenue.
Fair enough, sir. My other questions are answered, sir. Very good luck, sir.
Thank you.
[Operator Instructions] The next question is from the line of Nitin Gosar from Invesco Mutual.
Sir, a couple of questions, more strategy specific. So online booking has 2: one is IRCTC for reserved one and UTS for unreserved one. And both are backed by CRIS. Can IRCTC take over UTS and bring that business into its fold?
In case of reserved ticketing, there's a service charge that we levy. UTS is normally unreserved ticketing segment, unreserved segment, which has a low ticket value. So low ticket -- with charging a service fee on low ticket value, perhaps Indian Railways does not consider it appropriate, of course. And we did not agree for giving the service without any service charge. We are a commercial organization.
Yes, sir. But keeping in mind feature of technologies, data and you will get access to a lot of data if you participate in UTS, you can bill lot of advertisement and other...
UTS, we will not get any data because there is no detail about the person who is buying the ticket. Anybody can go and buy a ticket. There's no form to be filled about his name, age and all that. It's only 2 tickets from Mumbai to Panvel. Anybody can travel on that. It is not a person specific. So as such, there is no data linked with the UTS ticket.
Right, sir. But log-in ID would create a data, but -- data which is linked to a log-in ID.
Log-in ID, yes.
But as of now, there are no plans or it can be developed...
Unless it becomes a business for us, we have no plans.
Sir, second question is with regard to Rail Neer business. I think you had a press release a couple of weeks back where you did mention that you are evaluating opportunity to sell the water bottle outside railway station. Could you throw some light on that business opportunity? How temporary is it? Or is it a permanent move that we are looking at?
See, currently, we are meeting -- I mean, if we take pre-COVID or normal period, we were meeting about 70% requirement of Indian Railways. Our primary duty first is to meet the 100% requirement of Indian Railways so that all these stations and trains are covered with Rail Neer and no other water is sold on them. Once we would have reached that stage, we could think of it. That is number one. Now this press release, what you are talking is that, currently, all our plants are either closed or running at much less capacity. So this was an idea at least to meet the fixed cost if we could sell it in the market, but then market has its own dynamics. Market may -- packaged drinking water generally is a force sell by the retailer. And retailers generally sell the water, which has the maximum margin. Our average costing of water is slightly higher for simple reason that our 100% water is tax compliant, and I should not be commenting here. We have to compete with a lot of unorganized players. So there's this factor of unethical competition that comes in. But still, we are exploring it.
Got it. And sir, once the train starts to normalcy, booking starts again, would government reconsider the ticketing charges, which are right now available to you? That is INR 15, INR 30 bracket. Will they revisit and try to bring it down lower? Any thoughts on that?
Why should they? They have given IRCTC full freedom to fixed the rates. So there is on rationale and logic by which they should play with it now.
Got it. And from Indian Railways' point of view, are they looking IRCTC as a company which can invest in fixed assets going forward or maybe replace certain costs of certain investments, which Indian Railways is incurring on its own, like participating in private trains or probably investing in pantry cars?
Indian Railways cannot think of putting any -- or any government department cannot think of any PSU for investing in assets of Ministry. And as PSU being independent commercial organization, like train you mentioned, then they will enter as a business proposition, not as investment for Indian Railways.
[Operator Instructions] The next question is from the Ankita Shah from Elara Capital.
Sir, you mentioned about the fixed charges, lease fixed charges, that we have to pay for locomotives. So I wanted to check, how much is that fixed cost?
No, it is not fixed charge for locomotive. It's fixed charge for the rake, I mean the coaches which we have taken for running these 3 private trains. And this lease charge is about INR 7 crores per train per year, roughly. I mean it could be anything between INR 6 to INR 7, right?
Okay. Okay. So basically -- and you mentioned that for all the new private trains that will be operated, no -- Rajdhani, Shatabdi, Duronto or existing trains will not be privatized, it will be completely new trains that will be operating on the current route?
I mean this is what was mentioned by Chairman of Railway Board in his press conference earlier. So I'm presuming it.
And so locomotive or the coaches have to be bought new and they will not take it from Railways?
That modality is not yet decided. I mean they can buy it from any source. It could be one of the railway production unit, but all this is not decided. But the type of rolling stock, how modern the rolling stock will be, that is defined.
The next question is from the line of [ Rajesh Gora from Genme Venture Advisor ].
Congrats for a pretty good set of numbers despite COVID. The revenue decline in the Internet ticketing business was about INR 33 crores between December quarter and March quarter. But the EBIT decline was around INR 40 crores. So what was -- how many days of business did IRCTC lose in this fourth quarter?
See, fourth quarter, I mean the impact of COVID we started feeling from January itself when travel volume was reducing, right? And finally, the trains were canceled from, I think, 22nd or 23rd of March. And many trains -- like, we canceled our Tejas from 17th March. So volume was very low in the month of March, almost 50% of the regular volume. But the downward trend has started from January itself.
Okay. Okay. Despite that, you have done pretty well on the margin. You haven't let it decline significantly.
Largely, in Internet ticketing, it is basically the fixed cost of server networks and software maintenance and manpower, which is a certain percentage, and that remains as it is.
Sure. Interestingly, the catering side, while the revenue decline was there from INR 269 crores to INR 236 crores, the EBIT margin almost remained flat around INR 29 crores. So could you give some idea on that business? What was the impact and as you explained for the Internet ticketing in the fourth quarter?
I mean, again, for catering also there was -- I mean this impact of reducing number of passenger was there. But margin was there because we changed the working model also.
Okay. Meaning -- what was the change?
I mean earlier -- there were many trends which were outsourced on PPP model. So instead of running them departmentally where our own men were running and we were getting lesser margin, and it went on PPP mode and we started getting license fee and other charges. So this rationalization of working model resulted in margins remaining the same. Then in some trains, license fee was increased by about 10% for trains covered under the standard bidding document. So it was primarily on that one.
Ladies and gentlemen, we'll take the last question from the line of Priyank Chheda from Standard Chartered Securities Limited.
Sir, just wanted to know the data point for this quarter. How many total tickets were booked approximately, if you can recall?
For this fourth quarter?
Yes.
Number of tickets you are asking.
Yes.
Just a minute. It was 6.88. It was total 6.88 crores tickets -- number of tickets.
Okay. So that would be roughly around INR 140 crores kind of odd revenues?
Yes.
Balance revenues of INR 50, INR 55 crores would be from the website monetization?
From the website monetization and this payment mechanism and other things, yes.
Okay. Sir, second question is regarding the major CapEx that we do for Internet ticketing in IT. So you have guided earlier that 5 to 6 years is the time period after which you consider it ends. You have guided that there's some CapEx that was getting planned for FY '21 end. Any update on that?
This replacement of this entire ticketing system, I mean, once replaced, it works for about 5 to 6 years. And then we do this replacement phase-wise. So '21, we will start the replacement, but peak CapEx for this will come somewhere in '22, '23. We will start the replacement this year.
Okay. So based on that, if there is some major change in the software, for the CapEx that we do, that's incurring -- we incur in FY '22, '23, do we plan to change our ticketing reservation charges in those years, in the coming years?
Currently, there is no such thought because when we decide the ticketing charge, we provide for this. Thank you.