Bus travel is growing 2x on a y-o-y basis, IntrCity SmartBus cofounder, Kapil Raizada said. The company sees a growth opportunity from people travelling from tier-2 and 3 cities to metros in the near future for the bus travel segment. The bus travel company will add 25 per cent more routes in FY24 and double its daily frequency in the coming year.
“Given the pace at which the road infrastructure is growing, the bus segment has seen a multifold growth in the past few years. On a year-on-year basis, there is a 2x growth that is happening. We expect this pace to continue as infrastructure gets better,” Raizada said.
Growth potential
According to a study done by the company, the bus segment is expected to reach 10 per cent growth, but has the potential to grow to 25 per cent, driven by a shift in customer behaviour and an overhaul in bus operator business operations.
The report also stresses the potential for expanding the reach of outstation travel operators beyond metros and tier-1 centres by focusing on affordability as the central offering. It further sheds light on the various reasons for businesses to choose full-stack tech aggregators such as the requirement of a steady revenue stream and a better value proposition in terms of operating and revenue conditions.
Raizada said that today more than half of the bus travel are sleeper buses, and nearly 70-80 per cent buses intercity buses in India are AC buses. The report suggests that Indians prefer night travel on buses as they save the cost of a hotel stay for economical travellers. Another trend that the report notes is that 25 per cent of the total travellers are women, of which nearly half are solo women travellers.
Basic amenities
“The bus industry is growing faster than the economy at about 15 per cent. However, the government needs to focus on basic amenities at bus stations such as scanners, washrooms, seating areas etc just like there is a focus on railways and airport infrastructure development. Once that is done, India can be the largest intercity bus travel industry in the world, he said.”
Intrcity operates 650+ routes operating across 16 States, with nearly 2 lakh bookings per month, registering a 186 per cent increase in annual revenues and achieving operational profitability in 2022.
In the coming fiscal, it plans to add 25 per cent more routes, along with doubling its daily frequency within these routes. According to Raizada, it makes business sense to penetrate deeper into existing markets before entering other markets.