Travel companies are once again ramping up operations. Thomas Cook India?s managing director Madhavan Menon spoke to FE?s Vishakha Talreja about his company?s plans, industry consolidation and air fares.

What are your expansion plans?

We are now present in 72 cities. In next two to three years our target is to be in 110-120 cities. Studies indicate that bulk of consumer wealth is in 110-120 cities and that?s where the consumer spend will come from. We are planning a way ahead. Two years back, we started franchising and today we have about 50 franchisees. We will grow systematically. We need to have a mix of agents, our own offices and franchisees in these cities. The retail explosion in the country is happening and we want to grow through all channels. We have tied up with Shoppers Stop and Cross Words for selling our readymade holidays packages. We are also in talks with the Landmark group for a tie up.

What is the growth in turnover that you are targeting this fiscal? What is the percentage of your business that comes from forex services?

Holiday business will give us 25-27% growth and we are quite comfortable with that. Next year we should have 30% growth.

Forex is still very large for us, travel at sales level is still not even comparable. At revenue level, around 65% of it comes from forex and the balance from travel. But then, we have been in the forex business since last 60 years while travel was started only 15 years back.

The ratio will improve maybe not in my time but our ambition is to have a 50:50 mix. We are investing in retail to grow our holiday business. We are positioning ourselves in each segment.

There is lot of talk about affordable travel packages these days, with even big players introducing ?affordable? holiday packages. Affordability is the only way to break into the mass market. That?s where we have positioned ourselves. We will look at new destinations and focus even more on affordability.

Each new product that we offer will be more affordable. It is the trend of every industry, which the travel industry is now following. You can?t buck that trend. We have recognised that the more affordable you are more people will come to you.

Do you think domestic airfares are opaque in this country?

We are only sellers of tickets. We are not part of the process so we don?t have a standing. It is an argument between the government and the airlines. Of course equilibrium needs to be reached, which can be only driven by market forces.

Some travel majors are eyeing acquisitions. Is the industry witnessing consolidation?

Consolidation in the industry has been happening for quite some time, right from when Kuoni bought SITA and then we bought TCI. But the organised players hardly form 30% of the travel industry. The real consolidation will happen when mom and pop shops are acquired or merged.

Are we seeing that consolidation happening? Well we don?t see that trend yet. As far as Thomas cook is concerned if something looks attractive, interesting and economically viable only then we will look at it.

What are you doing to step up your online presence?

We have a booking site. In Europe there is a project going on to make Thomas Cook an OTA (online travel agent). But we will wait for them to roll it out before we can adopt the strategy in India. We are in the e-commerce space but we are looking at a far more B2B play than a B2C play.

What are some of the challenges for the travel sector?

Visas are my biggest challenge. Year after year my collegues have to pull their hair because embassies or consulates are not willing to process visas faster or not taken more than a set number of applications. They might have their own reasons, but for a travel company is the biggest challenge.

Also for India recovery in inbound tourism will take time. Both airfares and hotel room rates are high. At the same time major source markets that is UK and USA continue to remain impacted.