Online travel firm Cleartrip is expanding into hotels, buses, and trains to reduce reliance on air bookings. The company aims for non-air segments to provide 45% of its business by 2026, following a 69% rise in FY25 revenue to ₹169 crore.
Cleartrip, the online travel agency now owned by the Walmart-backed e-commerce giant Flipkart, is reshaping its business strategy to diversify beyond its traditional focus on flight bookings. The company has set a target to derive 40% to 45% of its total business from hotels, buses, and trains by the end of the 2026 fiscal year, significantly increasing its contribution from the current level of 22%.
Scaling Hotel Operations
The hotel segment has emerged as the company's fastest-growing area, recording a growth rate exceeding 50%. This increase is supported by a strategy of directly contracting properties rather than relying solely on third-party aggregators. Cleartrip has reported a doubling of room nights year-over-year and now manages an inventory of over five lakh international hotels. It also claims to hold the second-largest directly contracted domestic hotel network in India, a key advantage for securing better margins and inventory control.
Financial Context and Path to Profitability
For the fiscal year 2025, Cleartrip reported operating revenue of ₹169 crore, marking a 69% increase compared to the previous year. While the company is growing its top line, it continues to operate at a loss. However, it did manage to narrow its net losses by approximately 20% to ₹651 crore in FY25. The company’s balance sheet reflects the intense competition in the Indian travel tech sector, with significant spending of ₹608 crore on discounts and cashback, ₹102 crore on advertising, and ₹129 crore in commissions. Management is aiming to reach a breakeven point by early 2027 by shifting the revenue mix toward higher-margin non-air products.
Technology and Market Strategy
To drive this transition, Cleartrip is integrating new features designed to improve user retention. It has introduced tools such as visa rejection cover, which the company states has already increased bookings by 15%, and a price tracking feature that has boosted conversion rates by 3% to 5%. Furthermore, the company is investing in artificial intelligence to create a conversational booking agent and is targeting younger demographics through the creator economy and influencer-led affiliate programs. Data from the company indicates that bookings from Gen Z solo and group travelers have grown by 60% to 70%.
Future Monitorables
While the expansion into hotels and trains helps diversify the business, investors and observers should track the company’s ability to manage its high marketing and customer acquisition costs. Sustaining growth in non-air segments while simultaneously narrowing losses will remain the primary challenge. The company's progress toward its 2027 breakeven goal will depend on the successful execution of its technology investments and the effectiveness of its new loyalty programs in a highly competitive online travel market.