Not sure if Rategain will benefit from this trend. They have almost no exposure to the Indian hotel industry. If I recall correctly, India only contributes around 1% of their revenue. Most of their business comes from USA and Europe.
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Business from Marriott Inter-Continental or a Hyatt, group business in India they have exposure.
Pure Indian hotels use service from STAAH technology.
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From Q3Fy24 Concall
What I read from the concall & looking at the STAASH Tech website.
It seems, RateGain is also first trying to penetrate the Indian Hotel segment through the Distribution segment where they will be competing with STAAH tech. It will be great if they are able to gain some market share coz from there, they can slowly bundle other value added services from DaaS & Martech.
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I hope they are able to crack the India market with distribution, which has been their only segment that has shown signs of slowdown. However it wont be easy with the incumbents. I feel TBO TEK is a better bet if one has to play the India hotel distribution theme, but the valuations are insane at the moment and there is no headroom left for generating alpha.
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Excellent numbers posted by the company again. Here are a few key points to focus on:
- 40% YoY Revenue Growth
- 69% YoY EBITDA Growth
- 48% YoY PAT Growth
- 60.7% of the revenue is subscrption based
- Strong CFO and Net Cash position
- Net Revenue Retention (% of incremental revenue from same clients compared to previous fiscal) - 113.2%
- 337 new customers added in FY24 (now at 3279 customers in total)
- 11.2% Attrition (down from 21.1% in FY23)
- 285Cr of Order wins (2.2x of FY23)
- 486Cr of Order Pipeline
- 22.3% increase in Revenue per employee
- Contribution from top 10 customers: 28.3% of total revenue in FY24, down from 32.2% in the previous year
- Margins have expanded further (EBITDA margin for Q4FY24 at 21.2% and at 19.8% for FY24)
- Sustainable LTV to CAC range is 12-16
- Long-term cash generation is expected to be 70-80% of EBITDA
- Exits of travel tech players in the hospitality industry globally have benefitted RateGain
- Expect organic revenue growth of 20%
- Growth could be higher if there are any acquisitions
- Adara has a seasonally weak Q4, but Q1 is generally very strong
- Q1FY25 is expected to be higher than Q4FY24
- Working on a new hotel pricing product called navigator
Segmental Revenue:
- 94% YoY Growth in DaaS
- 106.1% YoY Growth in Martech
- Distribution grew at 9%
- Similar trend expected with DaaS and Martech leading the growth
Disc: Invested
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what I really like about Rategain is its world leader and innovative quality…in my honest opinion most LISTED indian IT companies are just doing bread and butter stuff(nothing particularly exciting) and mainly they just service the west because they can do things cheaper than in the west…Also most of rhese are very vulnerable with the advent of AI
But with Rategain there is not a lot of competion and they are very innovative
Who knows whether it is cheap or expensive though but its a company that India inc should be wholly proud of.
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Here’s the interview of Bhanu Chopra about the Guidance, M&A and the road ahead.
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