Resilience In Motion: What Irctc's Strategy Teaches Us About Post-covid Growth
When I, rajni hasija was given additional responsibility of Chairperson and Managing Director of the Indian Railway Catering and Tourism Corporation (IRCTC) in February 2021, the public sector undertaking (PSU) was struggling to recover from the severe impact of the pandemic, similar to others in the travel and tourism industry.
While many see life as a continuous learning journey, I believe it’s our profession that teaches us something new every day. My years with IRCTC were a testament to this, as I held various roles and learned constantly. Yet, nothing could have prepared me for the unprecedented challenges of COVID-19. Despite my experience and resilience, there was no roadmap for navigating a crisis of this scale—especially in the travel and tourism sector, where revenue nearly disappeared. I retired on May 31, 2023, after serving as CMD of the PSU for over two years, in addition to my five-year tenure as Director (Tourism and Marketing) at IRCTC. I felt a strong responsibility to revive the company's business in this domain, and believe me, it was no easy task.
IRCTC has been a leader in rail ticketing, catering, tourism, and its bottled water brand, Rail Neer. In 2021, I shared a story with a leading newspaper about my experience signing my first balance sheet as CMD. The total revenue from operations had plummeted to Rs 783.05 crore in FY21 from Rs 2,264.31 crore in FY20 due to the pandemic—a disheartening moment. Yet, this presented a critical challenge for the IRCTC team. As head of the organization, I had to keep team morale high. I have always believed that a skilled and competitive team is essential to navigating challenges and ensuring the longevity and adaptability of a business in a constantly changing environment. Only a competitive workforce can make a business resilient. This was the moment to put that philosophy into action.
Our IRCTC team put in tremendous effort, receiving specialized training to drive a remarkable recovery. In FY23, our revenue from operations surged by 88.5% to a record Rs 3,541.47 crore, with net profit up 52.5% to Rs 1,005.88 crore. Catering led the way, contributing 41.69% of revenue, followed by e-ticketing, tourism, and Rail Neer. With just 2,229 employees, we served millions, handled over 7.7 million passengers and 1.18 million daily ticket bookings. Our catering now covered 1,284 trains, with 14.8 million e-catering meals booked and 357.7 million Rail Neer bottles produced annually. In tourism, 140 chartered trains and nearly 92,000 passengers enjoyed our packages, showcasing the massive scale and resilience of IRCTC’s operations.
As I reflect on my journey with IRCTC, I recognize that the path to success has been shaped by a combination of strategic actions, resilience, and the unwavering dedication of my team. Navigating through unprecedented challenges, particularly during the pandemic, required a strong foundation of values and innovative thinking. From refining our after-sales service to introducing creative business models, adapting our tourism products, and gaining recognition in the industry, each step reinforced essential lessons. Ultimately, it is the strength and commitment of our team that has been the cornerstone of IRCTC’s recovery and growth. The following five insights capture the essence of what I’ve learned along the way and the factors that have driven our progress.
- My Team is My Strength: Having spent 13 years with IRCTC across various roles, I am a firm believer in the power of a dedicated and skilled team. My faith in IRCTC’s future is grounded in the strength and resilience of the people behind it. We’ve built a business model that can weather challenges With the introduction of more Vande Bharat trains and the additional line capacity from the dedicated freight corridor, our catering services are poised for expansion. The demand for Rail Neer continues to grow, and our team is scaling up production to meet this need. By March 2023, thanks to the collective efforts and determination of every member, all our business segments had not only returned to pre-COVID levels but were also turning a profit. This journey reaffirms my belief: with the right team, there’s no challenge too great.
- Strong After sale Service: The initial months after my joiing liquor liquor were particularly challenging, as the pandemic was at its peak and train travel had come to a grinding halt. During this time, our focus was on ensuring that passengers were promptly refunded for cancelled tickets and and also to refund for the tourism products, including luxury like Maharaja’s express. The task was completed efficiently in spite of few hiccups from the airlines. These efforts reinforced the importance of a strong aftersales service, as it helped rebuild trust with our passengers.
- Innovative Business Model: As a listed entity, profitability and revenue remained top priorities. As travel resumed and the tourism sector began to recover, we concentrated on regaining passenger trust and encouraging them to return. With railway ticketing and full catering services only resuming gradually, we used this time to train our staff in safety standards. The strategic decision to pursue horizontal rather than vertical growth, implementing initiatives to boost all segments of catering and tourism businesses together.
- Change in Tourism Products Suited to Business Needs: To adapt to the evolving needs of the market, we introduced Bharat Gaurav trains, Tejas trains, secured an online travel agency certification from the Ministry of Tourism, and shifted our focus from budget tourism to a more deluxe model. These changes allowed us to enhance our offerings while carefully managing costs.
- Hard Work Always Brings Recognition: Our recovery didn’t go unnoticed. Industry leaders like Vikas Gupta, CEO of OmniScience Capital, noted IRCTC’s robust comeback, with revenue returning to pre-pandemic levels by FY22 and significant growth achieved in FY23. Innovations like the expansion of pantry cars, train-side vending, and themed trains have further strengthened our position. Jinesh Joshi, Research Analyst at Prabhudas Lilladher, emphasized the post-COVID tourism resurgence, with IRCTC’s ticketing business remaining the primary revenue driver.
After my tenure at IRCTC, new management and leadership took the reins, bringing fresh perspectives to the organization. It’s rewarding to see IRCTC continue to evolve and pursue new avenues of growth. As the organization embarks on this next chapter, I take pride in knowing that the foresight and determination We worked to instill will support its future progress and resilience.