RateGain Travel Technologies Limited ($RATEGAIN)

Ladies and gentlemen, good day, and welcome to RateGain Travel Technologies Q4 and Full Year FY '26 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Bhanu Chopra, Founder and Chairman from RateGain. Thank you, and over to you, Mr. Chopra.

Thank you so much, and good afternoon, everyone. Thank you for joining RateGain Travel Technologies Q4 FY '26 and Full Year Earnings Call. This call marks the close of a defining year for RateGain, one in which we materially expanded both the scale of our platform and the breadth of our market opportunity. This was an important year for us operationally, strategically and structurally. And the opportunity ahead of us is the largest we've ever seen. For Q4 FY '26, we reported the highest ever quarterly revenue of INR 716 crores, up 175% year-on-year driven with the RateGain organic revenue stood at INR 311 crores, up 19.3% year-on-year, which is in line with the messaging shared with you in earlier calls at RateGain drilling back to double-digit organic growth by the end of fiscal year '26. Our adjusted EBITDA of Q4, came in at 23.5%, a growth of 177% compared to same period last year. The EBITDA is adjusted for the deferred [indiscernible] consideration related to the Sojern acquisition which is due to be paid for 3 years given the team meaning agreed upon revenue growth in the EBITDA target. For the full year fiscal year '26, revenue came in at INR 1,824 crores, reflecting a 69.4% growth year-on-year, and this is ahead of the right guidance we gave post the acquisition. We also now crossed a new record of INR 2,850 crores on annualized revenue run rate basis. Given the strong momentum on free cash flow generation, we expect to retire the balance of acquisition-related debt by fiscal year '28. The fiscal year '28 to end, we will be debt-free. Before I go into the business segments, I want to set the strategic context for this year because the numbers alone don't tell the full story. FY '26 for the year, RateGain cost a structural inflection point. The completion of the Sojern acquisition, the unification of Adara and the Sojern brand and the creation of the world's largest source of travel intend data were not just milestones, they were the foundation of a fundamentally different company. We entered fiscal year '26 as a strong travel technology platform. We are excelling it as the AI-powered operating system for travel revenue growth, connecting demand generation, distribution and revenue optimization through one intelligent platform, spanning marketing, data intelligence [indiscernible] engagement. No other player in our market combines travel intent data at the scale, distribution infrastructure at this depth and the AI-powered commercial intelligence under one Group. That integrated stack is our moat. Just to give you an update on the cultural implication, I'm pleased to say that it is ahead of plan. We've delivered the full synergies data in Q4 Adara and Sojern has been unified under a single brand that is Sojern. The underlying technology platform of Sojern and Adara are now consolidated into World platform. Full customer migration to that unified platform is on track and is set for completion by end of Q2. Equally important, we also consolidated Adara partnerships that Adara and Sojern each bring into the combined entity. As a result, RateGain today operates the world's largest single source of travel intent data at a scale no other provider in our market can match. The integrated platform now delivers 2 things at once: operational efficiency on the cost side and an unmatched data note on the revenue side. Both translate directly into pricing power and commercial momentum has been moved through FY '27. Our focus for FY '27 is clear, driving GTM growth and converting platform strength into commercial momentum. With 13,000-plus customers across the combined business, the cross-sell opportunity ahead of us is significant, and we are pursuing it with structure and urgency. Every product we are building, every promotion we are driving is aligned with 3 outcomes for our customers, acquire [indiscernible] efficiently, engage them meaningfully and expand wallet share over time. That is the integrated thesis, and that is the opportunity ahead. Let me walk you through now each of our businesses. Our #1 engine is our Martech engine. Martech continues to be our largest growth engine and an increasingly strategic differentiator for the company. I wanted to highlight some key points here. The Sojern's properties business is performing well and with strong customer additions, improved conversion in sustained pipeline momentum. Our value proposition for hotels is clear: drive direct bookings and improved marketing ROI. [indiscernible] is our priority growth engine for FY '27, where we see the strongest pipeline and faster adoption. Our travel intent data platforms was showcased through the FIFA workup 2026 market pulse dashboard. A free real-time intelligence to build on Sojern's traveling intent data, tracking booking signals across all 16 host cities in the U.S., Canada and Mexico. This serves as an early proof point of the combined platform's value, generating significant global media attention and positioning us as the center of industry conversations regarding destination intelligence. As the world's largest travel intent data company, we increasingly de-source to major media speakout for [indiscernible] commentary on the global travel demand. In the first 5 months of 2026 alone, as data has driven record breaking coverage across the world's most influential business publication, including the New York Times, [indiscernible], The Financial Times, Bloomberg, CNBC, Apia and the CRL types. 78 dedicated articles since March alone, a single Reuters feature built at our RateGain World Cup Index was republished 104 times across global outlets, including MSN, The Independent, The Economic Times and the [indiscernible] types. This is no longer company a vendor of travel data, we are becoming the definitive need on global travel demand. And that is a position no competitor in our space holds today. AI's strategic focus. AI remains a core focus with investments centered on helping travel brands remain discoverable and commercially optimize as travel behavior towards AI-powered and intent experiences. Our market team won 8 2026 AI CDNs awards, one of the hospitality industry's, highest market recognition reinforcing the momentum the president is building. Let me now speak about our distribution business. Distribution had a soft year on RateGain growth with strategic work done in FY '26 has meaningfully strengthened the platform and position us well for FY '27. Enterprise conversations are seasonally moving beyond connectivity towards broader distribution optimalization, profitability improvement and AI native automation across the full stack. This reflects the maturity of the [indiscernible] platform we are increasingly being viewed not simply as a connectivity provider, but as a strategic and outcome-oriented infrastructure partner for modern hotel commerce. A key strategic addition during the quarter was rate IQ, which addresses the challenge many [indiscernible] hotel chain space being protected with a dozen of OTAs with our clear visibility into which channels are truly drive bookings and where revenue leakage exists. Road IQ uses AI to service gaps, such as listing inventory, clarity breaks and underperforming ODA connections while quantifying the commercial impact of each. We announced agentic AI making [indiscernible] industry's first channel managers build an intelligent distribution logic, prioritizing retail inventory updates by putting urgency and promotional impact. Hotels are seeing up to a 30% to 40% optimization in the ARI traffic and meaningfully improve grade accuracy. This is a structural shift in how distribution technology works. One of the big global OTA has shown interest in piloting agentic ARI platform to preprocess the traffic from other sources, so to increase effectiveness of the integrations and revenue strategies. We introduced [indiscernible], a unified embedded P&L infrastructure, bringing together mutualized payment acceptance. RGP is live with just paid [indiscernible] [indiscernible] and cash fee payments and extend RateGain's role deeper into the commerce infrastructure of program. Now let me talk about DaaS. The DaaS segment delivered steady performance through FY '26 and continues to be a reliable contributor to overall growth. For our air segment, the air business continued its strong momentum with new airline wins across emerging and high-growth markets globally. [indiscernible] Airlines extended its partnership with retail for an industrial 4 years, while new customer additions included Tigerair, Myanmar Air international, Mongolian Airlines, Kazakh Air and Air Serbia further spreading [indiscernible] Global presence. The business also secured marquee long-term partnerships with Vietnam Airlines and Philippine Airlines reinforcing air gain's growing position as a global air travel intelligence platform. On the product front, [indiscernible] launched the new route performance guidance providing airlines deeper visibility in the group level performance and competitive position. Air Gain also preparing to launch the industry's first agentic AI interface, enabling faster insights and more inteligent decision-making for airlines. On the OTA, we continue to deepen our presence across key accounts and continue to see healthy revenue momentum. In the car segment, we delivered a solid performance with continued engagement with existing enterprise partners and expansion discussions progressing well across key markets. On the hospitality side, we've evolved from a market monitoring tool [indiscernible] active decision support platform with a long-term lens. Our AI-powered conversational intelligence layer that enables revenue teams to interact with complex pricing parity and demand intelligence through a conversational interface. FY '27 focus will be on scaling through these partnerships. Let me now talk about AI process that. Our approach is to really build AI agents that do the work in our industry. So for instance, a revenue manager AI agent, a distribution AI agent and a marketing agent, they are semiautonomous first and then fully autonomous the customer has [indiscernible] comfort with the AI agent. We currently provide tools to those audios, but ultimately, we see that agents will do the work. So some of it I have already mentioned in my commentary, but just to reiterate, we are building AI ads and campaign agents, running independent packages through AI agents to deliver higher ROI for our customers. Agentic ARI that I spoke about earlier, reduces the traffic by 30% to 40% improves street occupancy across channels, build data reduction [indiscernible] directly into savings for our customers and reduction in errors. [indiscernible] viva and his voice reservations across 30-plus languages is available 24/7 in hotels reporting up to 40% increase in revenue. AI concierge deployed across [indiscernible] 700-plus properties is now delivering up to 300% improvement in ancillary revenue and 75% improvement in NPL. At RateGain, AI is no longer experimental, it's embedded across commercial workflows, delivering measurable revenue impact, operational efficiency and stronger customer retention. This intelligent stands marketing, pricing, distribution and guest engagement. That integrated stack, embedded, measurable, monetizing the [indiscernible]. Let me now talk about people and culture. We are now over 1,300 people strong globally and recognized as a great place to work for the seventh consecutive year in India and for the first time in Spain and United States. RateGain was made emerging company of the year at the ET Corporate Excellence Awards, one of India's more prestigious corporate recognition. To be recognized alongside some of the most iconic business leaders in the country in both humbling and validating. It reinforces the credibility of our acquisition strategy the chance of our integrated platform pieces, the discipline of our execution and the ambition of our long-term vision. Given people and capability development we rolled out delta of AI-powered learning platform, delivering personalized go specifically only journey. We announced the launch of RateGain [indiscernible], a digital marketing certification program for hotel, commercial and marketing teams globally, reaching the priority to the industry faces in activating technology effectively. Let me now talk about the organic growth and guidance for FY '27. We expect to grow the revenues to INR 3,100 crores, which translates to 65% to 70% growth from the full year FY '27 over FY '26. This implies organic growth of 20% to 15% for the combined entity, for the RateGain and considering soldier numbers from the prior year. On the margin front, we expect to deliver an EBITDA of INR 650 crores to INR 700 crores. That's a margin of 21.5% to 22.5% for FY '27. This does not include the earn-out consideration related to the Sojern acquisition. In closing, FY '26 was a year of transformation and foundation building and validation. As we enter FY '27, our focus of some integration to monetization, scaling enterprise adoption, deepening customer wallet share and translating platform scale into durable profitable growth. Our ambition is to build a $1 billion revenue company by FY 2031 is grounded in the platform we have built, the market reserve and the commercial opportunity is now opening across the combined business. The platform is built. The clear is unmatched. The integration is on track and the opportunity as is the largest in our history. We're building an interpreted AI-powered travel technology stack focused on 3 outcomes for our customers, guest acquisition, test engagement and guest wallet share expansion, and we are doing so with measurable outcomes. With that, I will hand it over to Ankit Aggarwal to walk you through the financials. Thank you.

Thank you, Bhanu, and very warm welcome to everyone on this call, it is a pleasure to connect with everyone on the call today. This quarter, another important milestone in RateGain's cruise journey as we delivered a strong turnaround performance across the venue growth, profitability and strategic execution. Starting with an update on numbers for Q4 FY '26. We have reported our highest ever quarterly revenue of INR 716 crores, a growth of 135% with operating margins coming at 20.5%, showcasing disciplined execution even has continued to enhance. This revenue full quarter of Solium's revenue. RG organic revenue grew at a healthy pace coming in at all-time high of INR 311 crores, growing at 19% compared to the same period last year. RG organic growth is back in double digit as we had mentioned earlier in the last quarter. Within this, I'm happy to report that that segment grew at 21.5% in Q4 FY '26 with healthy performance across the organic DaaS business. RateGain Martech business, excluding Sojern due at an impressive pace of 37.5% in Q4 with healthy performance across all 3 segments. As Bhanu had mentioned earlier, we have also reported an adjusted EBITDA margin of 23.5%, slightly ahead of our team for exit margin last year. This adjustment is part of earn-out consideration related to Sojern acquisition we will be experienced over 3 years. This expense in cash and [indiscernible] will true up to down in line with the actuals since this entire payout is conditional in nature over a period of 3 year as revenue growth and EBITDA target. And this amount will be in the range of INR 20 crores to INR 22 crores per quarter for 12 quarters from here on. With the earnout, consolidated EBITDA stands at 20.5%. RG organic Q4 EBITDA stood at 20% ahead of the stated guidance. The adjusted PAT for Q4 stood at INR 90.9 crores in the margin of 12.7% and INR 249.9 crores for FY '26 with a margin of 13.6%. The PAT for the quarter stood at INR 70 crores with a margin of 9.8% and INR 194.4 crores for the full year FY '26. I would like to walk through the bridge from EBITDA to tax as it is important context for projecting EPS for '27 and beyond. The key recurring component of this delta amortization of Sojern purchase price consideration. This is a running USD 2.8 million per quarter and will continue for a duration of amortization schedule. Finance costs are running at approximately USD 1.6 million per quarter and will continue to reduce as we repay principal. On debt payment, we have maintained a strong discipline, having repaid USD 31.5 million to date, equivalent to 25.2% of the original loan through a combination of scheduled installments and prepayment. This brings our current outstanding values to USD 93.5 million. Unlike Q3, which carries an exceptional onetime charge of INR 34.6 crores related to M&A cost and labor loss changes, Q4 had no exceptional items. This is directly reflected in the strong sequential PAT recovery from INR 26.5 crore in Q3 to INR 70 crores in Q4. That has also been impacted by a reduction in interest income as a surplus cash previously earning interest was deployed towards the Sojern acquisition. This is a structural reallocation of capital, and it should not be leader related operational back. At an overall level, recurring EBITDA to a delta is approximately USD 6 million to USD 6.5 million per quarter comprising amortization of acquisition costs, finance costs and for interest income on the fund deployed for the acquisition. It is worth noting that actual cash impact of this delta is only USD 3 million to USD 3.5 million per quarter and amortization is a noncash charge. We are actively working to offset a significant portion of this through our cost synergies and operational units as integration benefits flow through. Sojern integration is progressing ahead of plan, and our focus remains on driving higher organic growth, accelerating cross-sell opportunities and expanding our presence in high-growth geographies. Most calibrated investment where we see the right opportunities. I'm pleased to report that we have exceeded our initial Phase I target annualized cost synergies now stand at USD 15 million up for the USD 12 million we had communicated last quarter. This positions Sojern on a clear trajectory towards 19% to 20% EBITDA margins. Free cash flow generation in Q4 was healthy at INR 82 crores, bringing full year FY '26 free cash flow to INR 230 crore. Going forward, we are confident of generating cash flow at a healthy pace and expect a free cash flow to EBITDA conversion to be harder 75% in FY '27. We continue to have a strong balance sheet with our network currently at [ INR 2,005.8 crores ] and our cash and cash equivalent balance at the end of quarter stood at INR 199 crores. Net debt as on date is down to [ INR 722 crores]. The broader travel industry continues to prioritize technology investments that can deliver measurable revenue outcomes and operational efficiency. We believe this positions RateGain strongly given our expanding global footprint, diversified product portfolio and increasing relevance across the travel and hospitality ecosystem. As we move ahead, our focus remains sustaining profitable growth driving integration synergies thoughtfully and continuing to strengthen our platform capabilities for long-term value creation. With that, I would like to close my remarks, and we are happy to open the floor for the questions.

[Operator Instructions] First question is from the line of Karan Uppal from PhillipCapital India.

Congratulations on a decent set of numbers. The first question is on the Martech segment. You mentioned about the scale of your operation combining Adara and Sojern. So if you can just provide some further color as to how many data partners are there in with the combined Adara and Sojern entity, how many unique travelers are being targeted by RateGain in a particular quarter? And how does these metrics compare with the second or the third year just to get something?

On the platform side, I'll take that part of the questions. So essentially, both at Adara and Sojern as you know, are in the same well known business of doing visual marketing, and we're using independent platforms and we have the decision to consolidate that platform into one platform. So essentially, we have now merged the platform and the new customer that the cost that we bring on board will be executed on the new platform. In addition to that, we have now also from a go-to-market perspective, consolidated the brands. So instead of operating those 2 separate brands at Sojern and Adara and RateGain, we are now taking our market brand largely as a Sojern brand. So we have deprecated the Adara brand. And similarly, associated with that, we have combined now different teams -- the go-to-market teams, the product engineering team into one consolidated entity into our market business that we are referring to as Sojern. In terms of the number of data partners, Ankit, would you be able to take those numbers?

Yes. This is a -- I think in terms of data partnerships, we would have on a combined basis, over 320 data partners for the combined entity, combining both from Adara and Sojern on to the on e platform. And in terms of travel graph IDs that we are tracking that would be over 1.5 billion graph IDs. That's not to say that that's individual travelers that we are tracking. Those are graph IDs that we are tracking.

Okay. And any metrics in terms of competitors? How do, let's say, the second largest or the third largest player be [indiscernible].

So as I mentioned in my commentary, there isn't really [indiscernible] to competitors to us now, which is the net flows that is worth mentioning, we're operating largely 3 segments. On the property side, I would say there is pretty much very, very limited competition. If I had to compare the second year as competitive to us, that would be -- just 1 for the size of our properties business alone. In fact, pretty much every major technology partners that requires to show marketing capability is wide labeling our product now. On the DMO space, we are absolutely #1. The nearest competitor would be in the DMO space. And on the corporate side, I would say that we are largely competing with -- when I say corporates, which is the large enterprise travel brands, maybe largely 3 days with agencies, which are non-tech. And we continue to see a shift that has been from that [indiscernible].

Bhanu, just on AI, because of the changing customer behavior, a lot of planning and [indiscernible] creation is happening on all these platforms like ChatGPT. So how does a player like Adara or Sojern capture a high intent travel customer in this scenario? Do you plan to partner with these [indiscernible] AI companies to source this data? Or will they be open to it? And secondly, how does the customer targeting be impacted as a lot of the I high intent travelers move to Adara.

Yes. And we so we are in active conversations with all the AI services both in terms of being able to get the data but also being able to advertise as you know, OpenAI is now contemplating selling at and we are in early conversations with them to enable self-serve ads on their platform from a travel and hospitality perspective. And similarly, we are very heavily engaged with Google to leverage their platform both from a perspective of using their [indiscernible] inventory on AI services and also in terms of data partnership.

Okay. And thirdly, in terms of the organic guidance, which you've had in INR terms. Despite it is converted in dollar terms, it appears to be in, I think, mid-single-digit to maybe high single-digit. It appears a bit conservative given the [indiscernible] which we had. So is it due to, let's say, metrics, which is impacting travel. Any further color you can share on the organic guidance? And also, if you can share the outlook across segments, that distribution and market.

So on the USD guidance, you are at about -- I don't know where you got that single digit because we still believe we are double-digit growth on the dollar guidance between 10% to 12%. On the individual products just give me a second. Divik, would you be able to give the price [indiscernible].

I can do that. So if we were to break this down, as Bhanu mentioned, on a USD terms, we are looking at 10% to 12% kind of growth is the outlook that we have. Within that, the DaaS growth is probably expected to be like a low double-digit number, which is going to be in the 10% to 14% growth range. Is there we expect DaaS to grow as we still continue to see good traction with some of the market clients and growth opportunity, volume growth opportunities over there. Distribution, I'm happy to report from a soft year, but we are -- I think it's safe to say that this quarter has kind of bottomed out. And from here on, we do expect to see growth going into next year, which will be anywhere like a mid-single-digit growth is what we see. And on the Martech side, at a consolidated level, we see opportunity for about, again, 12% to 15% kind of a growth for the Martech segment as a whole. Within this, we do see properties business growth to be on the higher side and then low double-digit growth across our Destination segment and SOHO, which is a very small piece, is expected to grow at a very healthy 30% plus kind of a number. Please do keep in mind, Karan, that we'll always be very conservative with our guidance going forward. And this 10% to 12% number is a conservative number that we are guiding the market on. And from our perspective, the idea is to always outperform on guidance and beat and outperform on that front.

Next question is from the line of Nitin Pranava from Investec.

Congrats on a solid quarter. I had a couple actually. So one is you mentioned that apnea is seeing very solid traction in terms of deal wins and stuff. If you could give some color around what's driving that strength? How are you seeing -- you know do there? And how are we looking to sort of replicate this success in the other geographies? And what at the moment are constraints to be able to sort of replicate that at the moment? That's the first one.

Yes. So I think we talked about this a lot in the last few quarterly calls about our investment in global market. And we had talked about investing about $5 million in -- largely in doing good marketing investments and more certain investments [indiscernible] to putting APAC sales and customer success team. So just to give you an idea, we were about 15 people at the beginning of cycle and today, we are almost in at 85 people in that team. And we are seeing some excellent traction in terms of bookings last as a result of that. Now to your point about replicating senior process in other geographies. That's the intent. We intend to take up Europe next. We already have a significant team in Europe even the Sojern acquisition, and they have a bunch of people there already, but our aim will be as long as our threshold's on sales and marketing investments are [indiscernible] that we will continue to reinvest. So I do see expansion of investment in Europe and LATAM. And then in the U.S., I feel like we have a currently large footprint already, but we are continuously seeking opportunities where we can double down on investment.

Got it. So in that context, well, we did, let's say, $5 million of GTM last year, are we looking to up that? Because if I look at the guidance compared to this quarter's adjusted margins, you seem to be sort of highlighting a lower margin for next year. So is that sort of a certain level of GTM that you have in mind that you're already investing? Or is this conservatism and you will -- this will sort of evolve as we go forward?

So you're using a calibrated approach. The idea is we made a lot of investments. We are integrating the teams in U.S. and Europe between Sojern and [indiscernible]. As we normalize those efforts the idea would be to continue to invest where we see the opportunity. So it's hard to suggest the number as of this point, a definitive number, but as you can imagine, integration has also created a larger footprint in some places. So for instance, we may have from Sojern and they give more number of people servicing a certain geography and we have the ability to reallocate that to under-penetrated geos. So that's some of the growth that we will do first. And then we will look to invest more, but we will keep you posted as these sort of go along. And it's hard to put out a number right now. But as I've been stating the opportunity is there, and we will continue to accelerate the organic growth.

Sure. I asked that because the $15 million is a good almost 5% on revenue. And in that context, that's the guidance appears relatively conservative. So yes, so that's where I came from. Okay. So that's helpful. The only other thing is that from a -- if you think of geographies, at the moment, you're the most bullish on happening, obviously, because a lot of work has gone into that geo last year. When you think of the other geographies, which geography do you think really leads growth from a geographic perspective between Europe and Americas, which is seeing more traction at the moment. And finally, I think from a deal wins as well, looks like we have not included Sojern, right? So when the deal wins have been solid on an organic basis, that number does not include Sojern, so may be understated. So I just wanted your thoughts there as well in terms of how we should sort of broadly think about that.

Yes. In terms of the growth in [indiscernible] originally, I think the U.S. growth will mimic the consolidated growth numbers that we have projected. And as you know, it's still a majority of our revenue. And I do see an opportunity of acceleration both in Europe and Asia Pac. And the reason I am -- it's not that I'm not bullish about US it's just that the revenue base in the U.S. is significantly higher now than other regions. But I do see that ultimately impact in Europe, the [indiscernible] exceeding our overall consolidated growth numbers.

If I may, I'll just drop in one more. In the context of a lot of transaction-based revenue and what we are seeing today in terms of airfares going up and all of those things. Do you think that in some form is a potential risk to growth for us? How would you think -- how should one think about that in body?

Yes. I almost feel it like as businesses counter intuitive in terms of growth in the overall industry growth. What do I mean by that? I think like people usually come to us when they are slightly troubled and need ways to unlock revenue through technology. I mean just to give you an example for instance on what's happening in Middle East, right? The PMO in Middle East, obviously, they have [indiscernible] on what they have been doing with us given the situation there, but the commentary we are giving to is us that actually is being stabilized the budget that they have and what we will be willing to spend is coming like we have never seen before. So while the Middle East business may be may only go back up slowly. But because we are a maintenance of unlocking revenue opportunities, we will be seeing a lot more opportunity from our PMO marketing activation perspective. And on the whole, the finite [indiscernible] employee in other areas also because the balance and [indiscernible] is getting is able to charge more. Do you [indiscernible] see us already to [indiscernible]. Even the [indiscernible] opportunities to only have revenue and drive more cost efficiency the say that when we think of a very even [indiscernible]. So I'm not worried and I see a very opportunity ahead of us.

That's very helpful, Bhanu, and all the very best for the next year.

[Operator Instructions] Next question is from the line of Ankit Kanodia from Zen Nevis.

I have just one question. In fact, I happen to read on news article, which I got from your LinkedIn post only, which talks about which we are competing for relevance in the AI area. And I would just request you to kind of little expand on this theme, how we are positioned for this and how do we see our business evolving based on this? And maybe some color as to -- I'm not asking for a guidance, but may give some color as to how our revenues will look like given this new era. If you can throw some light, that would be very helpful.

Yes, absolutely. So let me break the question into a couple of parts on how I believe AI is helping us internally and what we are doing with it externally and what I believe is it's going to help in terms of our story and scale in years to come. So in GenwatIam then very excited about across the operational efficiency and the productivity that we are able to drive already growing resin function, but what excites me the most is our ability to prototype and test new concepts very, very quickly. So I'm happy to report to you that as a result of AI teams now our ability to experiment has gone up 7-fold. So the number of experiments that we are running a several fold versus what we could run earlier. And also are cycled to prototype, digital market validate the thesis has also shortened quite significantly as a result. So as a tech country, opportunity to test new concepts and take it to market is its very, very fascinating. And I talked about internally, are we using it from an engineering perspective, from a product perspective, even in our HR, a lot of our retention and hiring capabilities and processes and now have AI embedded into it. We have our first AI HR person which is [indiscernible], [indiscernible] 24/7 and speaks 30 languages. On the [indiscernible] side, I talked about a lot of our capabilities that we have launched on our Martech running as we are running and turning AI campaign region. And one of the outcomes of AI-native product is to have an outcome-based pricing, which we already inherently have built in our business model. So if you look at our Martech business, we usually go to the hotel and say, that are we prebuilt, take the onus of doing all your digital marketing and for every booking that you get, do you pay us an X percentage of that booking. So there is a subscription fee to be paid. So how we run those campaigns now internally is completely automated and being run by AI agents. On our distribution side, I talked about agentic ARI, which is [indiscernible] were you seeing the traffic that was the hotel and the OTA assistant, we are very encouraged by what I talked about in our opening remarks, we have one big OTA that largely use our ARI agent to monitor the traffic between hotel and then to reduce that traffic because that -- reduction of traffic could mean it saves us hundreds of millions of dollars in total consumption in [indiscernible] and so that's very exciting. And secularly, we are yielding more booking because we are enabling more real-time thing between the hotel and OTA partners. And on the DaaS side, we have now moved from just not providing intelligence but actually doing the work. So for a couple of segments, we are launching an AI revenue manager. And then one of the key AI offerings that we launched a couple of quarters ago, that is seen a year of prevention for us is our [indiscernible] product, which is an AI-enabled voice agent. So it basically enables the hotel to receive calls through the AI agent and answer any discoverability related questions about hotel take bookings, et cetera. And a lot of our hotel customers, good-sized customers that have reservation offices have seen a huge advantage in deploying AI agent. Why? Because the AI agent is available 24/7 and can speak multiple languages, does not need to be continuously trained because as you know, call centers have a huge number of problems so we're able to solve for that. And overall, the fact that we have -- I've talked about this, data is the new oil in those AI world. And you have the largest producers of travel intent data, distribution and pricing data that creates a moat for us in this AI world, and we are very confident of being able to commercialize this into AI agents that actually do the work for the segments that we serve. So instead of providing foods that a revenue manager or distribution manager and the marketing manager can use, you ultimately want to be able to provide autonomous agents that actually do the work. So think of us as doing that vertical AI specialists that would be able to spawn out AI agents to take advantage of all these commercial opportunities that are presenting.

No, that's very helpful. My question was more related to this point with the article talks about, which is basically the next era of travel marketing will be defined less by volume and more by relevance. If you can probably explain on this one, that would be very helpful, that is my last question.

Yes, I'm sorry I don't recall the post because I had been posting a bunch about AI and also why companies like us are in position to take advantage of this AI opportunity. So if you're talking about my recent post about relevance of AI, I think that post was referring about how we are able to use, as I mentioned, our travel intent data to be able to personalize [indiscernible] pricing and the needs of the customer to drive a larger conversion in the larger return on our spend.

Next question is from the line of Nitin Shah, an Individual Investor.

Congratulations on a great set of numbers. So I just missed the initial con call given the guidance FY '27 guidance. Did I hear it correctly? And I don't know somewhere targeting around 3,000 top line and around 600 as the bottom line with 21.5% margin, was my understanding correct?

Yes. So we are projecting is INR 3,100 crores in revenue, which concentrates to about 65% to 70% growth over this year. And on the margin front, we are targeting an EBITDA INR 650 crores to INR 700 crores, which is a margin of 21.5% to 22.5%, but this does not be due to earn-out payments for Sojern.

Got it. And I believe -- I mean I don't know if you reflect, Bhanu, I have been attending the con call since last 4 years actually for almost since inception when we got listed and I invested in then. And my confidence [indiscernible] what every con call I attended. So thanks a lot for your kind guidance. And we expect $1 billion -- I mean, I don't see -- was it for FY '30, if I not mistaken?

FY 31, FY '30, '31.

I guess, we are pretty much close there. But only 1 thing what I wanted to ask, if I see the presentation, Bhanu, of all the verticals, obviously, the hospitality seems to be the major chunk, somewhere around 45%. What I see is that the day was [indiscernible] still almost 1/4, almost 25%. Is that a larger TAM than even the airlines sector by any chance.

So could you repeat the last question, I didn't follow it.

Yes. So if I see the presentation, the hospitality sector seems to be the larger chunk of our revenue, about 45%.

Correct.

But I see that the DA was considered almost 1/4 -- almost 25%, which is even larger than the airline sector. So is that the TAM on the [indiscernible] sector is larger? Or is it that we are less penetrated in airlines? Because I thought airlines would be comparatively larger TAM as compares to [indiscernible], but our [indiscernible] constituted 25%.

Yes. I think this is something that I'll have to come back to you. The spend on the TAM on airlines that it's significantly lower. But I would say at the same time, we are quite under-penetrated and given the -- given now the combined unit, I think there is a huge opportunity for us to cross an upside to RateGain customers because RateGain have a much larger footprint where the airlines on the DAS side, we will now have the ability to cross-sell and upsell our market solutions to them, and we are seeing some very good early signs both on car rental and airlines. But we'll have to come back to you on how big that TAM is for airlines versus hotels.

No, the only reason why I asked because our revenues on DMOs are almost 25% as compared to airlines, which is hardly less than 10%. So that's the reason why I asked.

Mr. [indiscernible], I think I got a part of your question. So I'll take this offline with you, and I'll send you an e-mail and connect with you over a call on this.

Next question is from the line of Anmol Garg from DAM Capital.

One thing. In this particular quarter, how much was the impact because of Middle East war and I just wanted to understand that we are talking about Apnea being the fastest growth geography while I'm assuming that the revenue from Middle East will still be impacted. So how much does Middle East contributes to our [indiscernible] vertical [indiscernible] geography and within this, what -- when do you think that this revenue will start coming through for us?

So in terms of the numbers on what is the impact from the release, I will let Divik or Ankit to answer that maybe we connect offline with you, but I will say that we were definitely impacted as I was stating earlier, our BMO business was quite impacted. Our Properties over there were also impacted [indiscernible] hotel business was impacted. The exact magnitude of it, unless Divik Anand Ankit comment on it. In terms of when do we think when we think when we can come back to normal, I don't think anyone can give you a clear answer on that. And even Donald Trump cannot give you an answer on that. So it's difficult to me to state when things normalize. But as soon as they normalize as I stated earlier, I think will you be a big [indiscernible] because we do expect especially the [indiscernible] more to go quite crazy in terms of their marketing spend to rebuild the credibility and confidence to attract [indiscernible].

Yes, I can take the number question, Bhanu. So as you asked, it's 4% of the total revenue that we get from Middle East. And the impact which we are seeing is across $2 million, and that was deferred when revenue hit.

Okay. Understood. And just a small data point question, is that within our Sojern now combined Adara business, how much of the -- approximately when you come directly from customers, while how much comes through agencies?

I think we can take that question offline.

Ladies and gentlemen, we will take this as a last question for today. I now hand the conference over to Mr. Bhanu Chopra for his closing remarks. Over to you, sir.

Yes. So I wanted to take this opportunity to thank our customers, our partners, our employees and more importantly, our shareholders for the trust they have placed in us through what has been a defining year for RateGain. The opportunity ahead of us is the largest you've ever seen and we are pursuing with everything we have. So thank you, everyone.

Thank you, sir. On behalf of RateGain Travel Technologies, that concludes this conference. Thank you all for joining us, and you may now disconnect your lines.