Targeting 20% revenues from non-lounge services in 5 years: DreamFolks CMD

The company currently earns 99% of its revenues from providing technology solutions connecting banks (and their debit and credit cards) with airport lounges

Dreamfolks Service is planning to diversify its revenue streams with the aim of earning up to 20 per cent of revenues from non-airport lounge services in 4-5 years, chairperson and managing director Liberatha Kallat said on Monday.

The company currently earns 99 per cent of its revenues by 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 — would contribute about 20 per cent by FY27,” she noted.

Moreover, about 99 per cent of Dreamfolks’ clients are banks.

“That would also shift to around 80-20 per cent share in the next 4-5 years,” Kallat told Business Standard. He indicated that the company is aiming to have a client base comprising 20 per cent non-bank companies. 

The company — which listed on BSE in September last year —earned consolidated revenue and net profit of Rs 777 crore and Rs 73 crore, respectively, in 2022-23. In H1 of 2023-24, it earned a 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 strategy to diversify its client base, specifically targeting non-banks. Additionally, these cards are intended for direct consumers.

Kallat, however, clarified that DreamFolks is a business-to-business (B2B) company. And so, the primary emphasis will be on acquiring non-banking companies as clients.

“We have also started working with the corporate sector (non-banking companies). We have realised 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 a lounge as a service. It is not just the lounges, but about other services also,” she added.

She said that post-Covid, it's not only business travellers 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. This prevents other family members, including children, from entering the area. Such travellers can now access lounge services for their family members using the DreamFolks club membership card.

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 their credit/debit cards before availing airport lounge services.

Kallat said there is a change in the programme structure to ensure that the benefit goes to “the right user.”

“Today, when you go to a lounge, there are people who are carrying multiple cards in their wallet. Most of them use the card only for the lounge. They do not actually use that card for anything else. So, the bank wants to ensure that the benefit of lounge access is going to the right user. That is, the one who spends money using that credit/debit card,” she said.

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 will primarily be 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 added.