Targeting 20% revenues from non-lounge services in 5 years: DreamFolks CMD
Dreamfolks Service is planning to diversify its revenue streams with the aim of earning up to 20 per cent of its revenues from non-airport lounge services in the next 4-5 years, its Chairperson and Managing Director Liberatha Kallat stated on Monday.
The company currently earns 99 per cent of its revenues from providing technology solutions connecting banks (and their debit and credit cards) with airport lounges. “I would say that the other services — beauty and grooming, healthcare, travel visa, golf, airport meet and assist, etc — would contribute about 20 per cent by FY27,” she noted.
Moreover, about 99 per cent of Dreamfolks’ clients currently are banks. “That would also shift to around an 80-20 share in the next 4-5 years,” Kallat told Business Standard in an interview, indicating that the company is aiming to have a client base comprising 20 per cent non-bank companies.
The company — which listed on the Bombay Stock Exchange (BSE) in September last year — earned consolidated revenue and net profit of Rs 777 crore and Rs 73 crore, respectively, in 2022-23. In the H1 of 2023-24, the company earned consolidated revenue and net profit of Rs 550 crore and Rs 31 crore, respectively.
On Monday, DreamFolks launched its own membership club along with four card variants. These cards are part of the company’s aforementioned strategy to diversify its client base, specifically targeting non-banking companies. Additionally, these cards are intended for direct consumers (end users). Kallat, however, clarified that given DreamFolks is a B2B company, the primary emphasis will be on acquiring non-banking companies as clients.
“We have also started working with the corporate sector (non-banking companies). What we have realised is that they want to give these benefits to their employees, customers and channel partners. They want to curate the services. It is not necessary that everyone wants lounge as a service. It is not just the lounges, it is about the other services,” she explained.
She mentioned that post-Covid-19, it’s not only business travelers but also other groups of consumers who wish to visit airport lounges with their families. Typically, in India, only one or two individuals possess a debit or credit card with airport lounge access, preventing other family members, including children, from entering the area. Such travellers can now access lounge services for their other family members using the DreamFolks club membership card, she explained.
As queues at various airport lounges become more prevalent, several banks are imposing conditions on credit/debit cards. Nowadays, they require consumers to spend a specific amount of money on the credit/debit card before allowing them to avail airport lounge services.
Kallat said that there is a change in the program structure to ensure the benefit is going to “the right user”.
“Today, when you go to a lounge, there are people who are carrying multiple cards in their wallet. Most of the people use the card only to use the lounge. They do not actually use that card for anything else. So the bank wants to now ensure the benefit of lounge access is going to the right user, the one who spends money using that credit/debit card,” she noted.
The company currently has 75 employees on its rolls. “My tech and operations department is the major one,” Kallat said. As the volume of business grows, this does not mean that the number of people will grow in proportion, she noted.
The company would be primarily hiring people for business development. Therefore, in the next 3-4 years, DreamFolks does not expect to have more than 100 employees on its rolls, Kallat noted.
First Published: Dec 18 2023 | 7:20 PM IST