Dreamfolks Services Limited Q3 FY26 Earnings Call Summary

Summary

Dreamfolks Services Limited - Q3 FY26 Earnings Call Summary Monday, February 09, 2026 4:00 PM

Event Participants

Executives 4 Balaji Srinivasan (ED & CTO), Liberatha Kallat (CMD), Sandeep Sonawane (CBO), Shekhar Sood (CFO)

Analysts 3 Marutinandan Sarda, Muralidhara Reddy, Vijay Kumar S.

Financials & KPIs

Geographic & Segment Commentary

• Global Expansion: The segment now contributes 68% of total revenue, driven by a 200% YoY volume growth. Management is targeting a ₹500-550 crore revenue opportunity from international markets within two years, focusing on Middle East and Southeast Asia (Singapore/UAE).
• Railway Lounges: Currently operating 12 lounges with vertical integration starting through the Ten11 acquisition. Management projects this segment to reach ₹500 crores in revenue over the next 5 years, benefiting from the government’s ₹2.78 lakh crore railway capex and Amrit Bharat Scheme.
• Lifestyle & B2C: Launched DreamFolks Club 2.0 to transition from travel-only to a lifestyle platform (golf, wellness, social clubs). This segment is expected to contribute ₹100 crores in 2-3 years without aggressive marketing spend.

Company-Specific & Strategic Commentary

• Vertical Integration: Acquired Ten11 Hospitality to gain operational control over premium railway lounges in Chennai, Mumbai, and Vadodara. This move reduces reliance on third-party operators and improves unit economics with expected EBITDA margins of 9-10%.
• Inorganic Growth (International): Acquired Easy To Travel (ETT) to accelerate global distribution. This adds a technology-led platform to capture a share of the $5 billion global lounge industry.
• Tech Transformation: Implementing a Machine Learning-driven “intelligent orchestration platform.” The focus is on benefit fungibility and personalized service bundles for banking clients to replace static domestic lounge products.
• Service Diversification: Successfully went live with major banking clients for new premium lifestyle services. These services are designed to become mainstream credit card benefits alongside traditional lounge access.

Guidance & Outlook

Risks & Constraints

Q&A Highlights

Thematic Mix & Global Business

• Question: What is the revenue contribution and outlook for the global business? (Priyadarshan Banjan)
• Answer: Global lounge transactions currently contribute 68% of revenue (Shekhar Sood). The focus has shifted from only Indian travelers to global cardholders, with clients now being onboarded from outside India (Liberatha Kallat).

Railway Segment Economics

• Question: What are the capex and ROE expectations for owned railway lounges? (Marutinandan Sarda)
• Answer: Capex is approximately ₹1-2 crores per lounge depending on size. Management expects a minimum ROE of 15% to 18% as volumes scale (Shekhar Sood).

Strategic Recovery

• Question: How confident is management in the new model given the domestic disruption? (Vijay Kumar S.)
• Answer: Promoters have not sold any shares, reflecting confidence in the pivot. The company is reinventing itself as a “benefit management ecosystem” rather than a transaction provider (Liberatha Kallat).

Cash Flow & Sustainability

• Question: When will the current cash burn stop? (Marutinandan Sarda)
• Answer: Cash burn is expected to cease in a couple of quarters, with the company turning cash-positive in 2-3 quarters (Liberatha Kallat).

Key Takeaway

Dreamfolks is currently navigating a period of intense structural transformation following a significant decline in its legacy domestic lounge business, which saw Q3 revenue drop to ₹53.4 crores. To counter this, the company has pivoted toward a “global-first” strategy, with international lounge volumes growing 200% YoY and now representing 68% of total revenue. Strategic acquisitions of Ten11 Hospitality and Easy To Travel signal a move toward vertical integration in railways and accelerated global distribution. Management is targeting ₹500 crore revenue milestones for both the Global and Railway segments over different time horizons while maintaining a strong cash position of ₹129 crores. While the company reported a PAT loss of ₹7.9 crores this quarter, the focus on diversified lifestyle services and technology-led orchestration is expected to lead to cash breakeven within 2-3 quarters, positioning Dreamfolks as a broader lifestyle experience platform.