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Page 3 of 3 | DARE/estimate | | Delhi - Current Status | | | Total radio cabs out on the road | 1,000 | | Charge per kilometer (Rs) | 15 | | Average paid run per day, per cab (Km) | 90 | | Occupancy per day (%) | 70 | | Daily Fare Collection (Rs lakh) | 9 | | Running days per year | 300 | | Total running revenue p.a. (Rs Cr) | 28 | | Delhi - 2010 Projection | | | Estimated number of cabs | 20,000 | | Charge per kilometer (Rs) | 18 | | Average paid run per day, per cab (Km) | 120 | | Occupancy per day (%) | 70 | | Daily Fare Collection (Rs lakh) | 302 | | Running days per year | 300 | | Total running revenue p.a. (Rs Cr) | 907 | | Advertisements (Rs Cr) | 120 | | Total revenues (Rs Cr) | 1,027 | | DISCLAIMER: This data and analysis are indicative and Cybermedia makes no warranties about its accuracy. You are advised to do your own analysis if you are evaluating a similar venture. | Technology
For the tech that runs at the backend, the approach has been diverse. Easycabs chose to get the best one already up and running successfully elsewhere in the world. “While we went looking in various parts of Europe, North America, and the Middle East; we found that technology used in Singapore was by far the best. That is what we picked up in the end”, says Vij. The current system can scale to handle a fleet of 5,000 cabs. Megacab took the route of developing a custom backend solution. Lalani emphasises, “Technology is not that simple, as in you cannot transplant it. We did go through various international systems, took good ideas from each, and got them custom developed in a joint venture with an external agency, with a focus on the Indian situation.” The key to success is in maximizing the reach and utilization of the fleet. Vij of Easycabs is exploring ways to bring down the waiting time after a call from the 30 minutes at present to 5 minutes, which is the international standard. Each cab at Megacab, like most other players, currently runs 80-100 km daily. Lalani aims to increase this to around 140 km in the near future. Vij believes that he needs about 5,000 cabs in his fleet to cater to Delhi. He is exploring the possibility of making Easycabs available at special stands across the city. “We are working with the Delhi government and the municipal corporation to create sites all across the city, just like bus stands. This way, anyone who wants to hire a cab can directly walk to the closest stand and hire one”. Future perfect!
According to Lalani, Delhi alone has the potential for generating Rs 1,400 crores, five years from now. Megacab already has its business running in Chandigarh and plans to start the service in Mumbai in October 2007. Further, Megacab already has a license for operations in Goa, and is close to getting one for Hyderabad. IRCTC has online booking of cabs for passengers in 16 cities i.e. Ahmedabad, Bangalore, Chandigarh, Chennai, Faridabad, Gurgaon, Hyderabad, Jaipur, Kolkata, Mangalore, Mumbai, Mysore, New Delhi, Noida, Pune, and Secunderabad. Advertising income
Passenger fare is not the only source of revenue for the operators. Advertisements on the cars are also a good source. On an average this works out to Rs 3,000-4,000 per cab per month. The government is trying to frame a policy for ads on Radio Cabs. According to reports, government estimates puts the earnings from these ads at Rs 245 Crore during the Commonwealth Games in Delhi in 2010. Our feel is that this is the card rate and the revenue to the operators would be in the range of 120 Crore in Delhi alone.  |  | | Delhi alone has the potential of Rs 1,400 crore in the next five years Kunal Lalani
Megacab | I started with a single leased cab. Now I have a fleet of 18, and plan to start operations in Delhi. I am looking for investments. Revathi Roy
Forsche | Social benefits too
Each of the operators are doing their bit for the social cause too. Megacab has a scheme called “Chalak se Malak”, which enables high-performing chauffeurs to own the cars driven by them in a span of about 3-4 years. It is a pay-as-you-earn scheme, which lets chauffeurs take home their minimum requirement of Rs 6,000-7000 after deduction of installments. This in turn helps buy Megacab their loyalty, and provides a huge incentive for service and maintenance. When the chauffeurs do end up owning the vehicle, the assumption is that they would want to remain in the fleet, leasing the cars back to the company. About 50 cabs have already been transferred to the chauffeurs already, and about 200 more are scheduled to be transferred in the near future. Lalani says, “After sometime, he finds himself sitting on an asset worth nothing less than Rs 1-1.5 Lakh. This might encourage them to get other members of their family into this business, and if all goes well, each one might be able to make a monthly income of about Rs 15,000-20,000”. Even Roy talks about employment for women in Forsche. She is roping in women who can drive. “Right now, Forsche has about 18 women chauffeurs. All are above the age of 40 years. Giving an employment opportunity to women of that age is something good! Not that we have any fixed age norm, but this is how it has been until now.” Also Read:
Radio Cabs: Challenges en route (a sequel to this article, done in July 2008)
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Too good...excellent business sense..very astute.