Yatra Online - Q1 2025
August 13, 2024
Transcript
Operator (participant)
Good morning, everyone. Welcome to Yatra 1Q25 earnings conference call. My name is Kiki, and I will be your conference operator today. During the presentation, you will have the opportunity to ask a question by pressing star followed by one on your telephone keypad. If you change your mind, please press star followed by two. I will now hand you over to your host, Manish Hemrajani, VP of Corporate Development and IR. Manish, please go ahead.
Manish Hemrajani (VP of Corporate Development and Investor Relations)
Thank you, and good morning, everyone. Welcome to our Fiscal First Quarter 2025 Financial Results for the period ended June 30, 2024. I'm pleased to be joined on the call today by Yatra's CEO and Co-founder, Dhruv Shringi, and CFO, Rohan Mittal. The following discussion, including responses to your questions, reflects management views as of today, August 13, 2024. We don't take any obligation to update or revise the information.
Before we begin our formal remarks, let me remind you that certain statements made on today's call may constitute forward-looking statements, which are based on management's current expectations and beliefs and are subject to several risks and uncertainties that could cause actual results to differ materially. For a description of these risks, please refer to our filings with the SEC and our press release filed yesterday evening on the IR section of our website. With that, let me turn the call over to Dhruv. Dhruv, please go ahead.
Dhruv Shringi (CEO and Co-founder)
Thank you, Manish, and good morning, everyone, and thank you for joining us for our First Quarter 2025 earnings call. For the quarter ended June 30, 2024, we reported total revenue of INR 1,051 million, which is approximately $12.6 million. This represents a decline of 5% year-over-year. Adjusted air ticketing margins were impacted by a 21% decrease on account of lower volumes. The decline was primarily driven by reduced volumes in the B2C segment as we optimized discounts amid intensifying price competition in the market. Despite challenges in the B2C segment during the June quarter, the corporate travel segment showed robust growth across all key metrics.
The company successfully secured 34 new corporate customer accounts, representing an annual billing potential of INR 2,028 million or approximately $24.3 million, with average billing potential up 77% sequentially. As the leader in corporate travel in India, our customer acquisition rates remain strong, consistently outperforming industry benchmarks. We also continue to actively evaluate strategic opportunities to further bolster our corporate travel segment. In addition, we made substantial progress in our Meetings, Incentives, Conferences, and Exhibitions segment, which is the MICE business, this quarter. A newly onboarded team has started ramping up operations, and while MICE contributions were modest for the June quarter, early signs for the current quarter are very encouraging, with significant business already secured in the September quarter.
In addition, we have also scaled up teams to focus on the mid-market corporate segment and new products, including visa services and car rental services for corporate travelers. Adjusted EBITDA came in at INR 65.6 million, approximately $800,000, a decrease from INR 115.4 million in the same period last year, partly reflecting the impact of lower volumes and partly due to the added expense of onboarding teams for new initiatives mentioned earlier. The cost of incremental hires is close to INR 40 million in the quarter. Ex investment of new initiatives during the quarter, our EBITDA would have been INR 105.6 million, which is broadly similar to last year. Let me emphasize the critical importance of accelerating our investment at this time in the corporate space.
Over the past few months, and particularly in the last quarter, the country's largest airline has begun offering deeply discounted fares exclusively on its website and mobile app. In light of the recent consolidation within India's domestic aviation sector and the current aircraft supply constraints, this trend is significantly increasing customer acquisition costs in the B2C market. As a result, it is imperative that we rapidly expand our corporate business, and we are actively exploring both organic and inorganic opportunities to achieve this. The MICE industry presents a compelling growth opportunity with its attractive margin profile, making it a strategic addition to our corporate portfolio alongside our visa facilitation and car rental services. Additionally, we have initiated a cost optimization program, which includes streamlining over 100 positions within the company. We anticipate realizing the benefit of these cost savings starting in September, after accounting for any notice period obligations.
We continue to make progress towards simplifying our corporate structure as well, with the board-appointed Restructuring Committee actively engaging with all relevant stakeholders. The committee is diligently working on developing a comprehensive proposal to streamline our operations and enhance shareholder value. For the quarter ended 30th of June 2024, we reported total revenue of INR 1,051 million, which is $12.6 million, as I mentioned, down 5% year-over-year, and adjusted revenue of INR 1,422 million, which is approximately $17.1 million, which is down 14% year-over-year, mainly on account of the factors that I mentioned above. While it is our strategy to position ourselves as a corporate provider of choice, we recognize our ideal customer mix.
Must be strategically balanced, and we are determined to winning back and regaining some of our B2C market share by implementing certain strategies in the coming quarter. These strategies we feel will be more tech-enabled, technology-enabled and innovation-enabled ones, and will not have a significant negative impact on our operating performance. Meanwhile, we continue to expand our corporate customer base, demonstrated by the strong addition of new corporate customers during the first quarter. We believe that our momentum in garnering reputable corporate clients serves as a testament to our excellent service and attractive platform offerings. Travel volumes in the IT sector, which is one of India's main business travel segments, was subdued in the first quarter of FY 25. However, we are pleased to report that our performance in this segment outpaced industry trends.
While travel spends on the Yatra platform by our IT services customers were approximately 30% below pre-COVID levels, industry reports indicate a nearly 50% decline in overall IT services spends compared to pre-COVID. This demonstrates Yatra's ability to capture an increased share of wallet within its existing customer base. I would like to also take the time to highlight some of our more recent strategic initiatives to expand our market and growth potential. As mentioned last quarter, we've expanded our software service to better meet the needs of our clients through the launch of our expense management solution. We are calling this solution RECAP, which stands for Receipt Capture and Processing. RECAP leverages cutting-edge technologies, including GenAI large language models, for its receipt analysis to enable more accurate and comprehensive expense tracking, significantly reducing errors and saving time for our customers.
We are currently working with a handful of customers on the expense front as part of our pilot program, as we look to cross-sell this product further into our current installed base. Expense management is a large and highly profitable segment, and our product capabilities make it a product that is suitable not just for the Indian market, but for international markets as well. Our initial response from customers has been very encouraging, and this solution allows us to further deepen our relationship with our customers. With our focus on the corporate segment and our commitment to expanding our presence and offering, as mentioned earlier, we've added a team for the MICE segment, and the early indications are highly encouraging.
To provide you some context to the MICE market, the MICE market is valued at approximately $3.3 billion in 2023, and is expected to grow to $10.5 billion by 2030, reflecting a CAGR of 18% from 2023-2030. Now, turning to the broader economic landscape. Business travel in India is on an upswing. Currently, India ranks as the ninth-largest market globally in terms of business travel spends. The market is expected to reach $38 billion this year and is projected to grow by 18% next year, surpassing pre-pandemic levels. This growth is underpinned by a strong economic outlook for the country, with the Reserve Bank of India projecting real GDP growth of 7.2% in FY 2025.
The Reserve Bank of India has also highlighted the positive impact of healthy balance sheets among clients and corporates, along with the government's ongoing focus on capital expenditure. We believe this translates into greater demand in the corporate travel segment in the coming years. While domestic travel remains stable, with expected growth in the high single digits, outbound travel is forecasted to grow significantly. Reports suggest that India's outbound departures could nearly triple to 50 million by 2030, fueled by improving connectivity, more direct and affordable flights, and a growing desire for international travel. While the June quarter posed challenges for our B2C segment, we are encouraged by the strong momentum we are witnessing in our corporate travel business. The growth in new corporate accounts and the existing development in our MICE business underscores our commitment to driving long-term value for our stakeholders.
We continue to fine-tune our strategic initiatives to maintain our position in the corporate sector while working to improve market share and regain share in the direct-to-consumer sector. With that, let me hand the call over to Rohan to walk you through the details of the financial performance. Rohan?
Rohan Mittal (CFO)
Thank you, Dhruv. I will now review our numbers for the quarter ended 30 June 2024. We saw a 17% YOY decline in our gross bookings. This was mostly due to the 20% decline in our air gross bookings, as explained earlier. Our hotel and packages gross bookings remained flattish. Our overall adjusted margin for the quarter decreased by 15% YOY. Our adjusted margins for the air ticketing business were at 6.8% and 11.6% for hotels and packages. Moving on to expenses. As a percentage of total gross booking value, our marketing and sales promotion expenses reduced sharply by 25% on a YOY basis. Our personnel expenses increased by 23% YOY as we continue to invest in talent to build out our mid-market MICE, visa, and expense management solutions. Other costs remained largely range-bound.
On an overall basis, adjusted EBITDA was INR 65.6 million, compared to INR 150 million in the quarter ended June 2024. Lastly, as of 30th of June, we were carrying cash, cash equivalents, and term deposits of INR 4.5 billion, which is approximately $54 million on our books. Our gross debt is at an all-time low level of INR 210 million, which is roughly $2.5 million. With this, we conclude our prepared remarks, and I'd like to hand it over to the moderator for Q&A. Thank you.
Operator (participant)
The person you are speaking with has put your call on hold. Please stay on the line. Thank you. If you would like to ask a question, please press star followed by one on your telephone keypad. If you change your mind, please press star followed by two. When preparing to ask your question, please ensure your device is unmuted locally. The first question we received is from Scott Buck, from H.C. Wainwright. Scott, your line is open. Please go ahead.
Scott Buck (Managing Director of Senior Technology Analyst)
Hello, everyone. Thank you for taking my question. Dhruv, you touched on it in the prepared remarks, but could you give us a little more color on what options are on the table in regards to the independent committee? And maybe what a reasonable timeline is to expect some decisions to be made?
Dhruv Shringi (CEO and Co-founder)
Sure. So with regards to the independent committee, the committee is currently working with advisors on evaluating the multiple options in front of us for simplifying our corporate structure. There are a couple of preferred groups that we've narrowed this down to, and now the committee, along with the advisors, is working with the regulators to understand the process and the feasibility of the different structures that, you know, are there in front of the company. In terms of timeline, I think the structures which are there are a 6-12 month kind of a timeline in terms of achieving full simplification of the process.
This is, you know, in certain scenarios, dependent on regulators in different jurisdictions, so this is only a broad guideline that I can share with you, and not an exact number, as I said, because there are multiple regulators which are involved in the process.
Scott Buck (Managing Director of Senior Technology Analyst)
Sure, I can understand that. And is the goal here to create some sort of fungibility between, between the shares?
Dhruv Shringi (CEO and Co-founder)
That is the end objective, to try and create a way through which the shareholders in the U.S. will get access directly to the India stock.
Scott Buck (Managing Director of Senior Technology Analyst)
Okay, perfect. I appreciate that color. Next, I want to ask about the B2C weakness. I'm curious, what of that you saw in the quarter is being driven by, you know, just kind of temporary softness in travel demand versus what, you know, may be more permanent headwind in, you know, direct sales of tickets from, you know, India's largest carrier?
Dhruv Shringi (CEO and Co-founder)
So there are two factors playing in right now. One is the supply side constraint. So as I had mentioned in our last earnings call, 75 aircraft were taken out by IndiGo because of the issue that they were facing with the Pratt & Whitney engines. This is a well-publicized litigation and issue which is going on between IndiGo and Pratt & Whitney. So that's the one thing which is there on account of which supply is limited in the country.
The other challenge which is there, which has got accentuated, is the view that IndiGo has started taking over the course of the last six months, and more so in the last quarter, of offering fares directly on its site, which are meaningfully cheaper than what are available through third-party distribution channels. That, I think, is the bigger and more concerning trend that we are witnessing at this point of time.
Scott Buck (Managing Director of Senior Technology Analyst)
Okay, that makes sense. And then last-
Dhruv Shringi (CEO and Co-founder)
I feel, you know, obviously will get solved, right? It's just a matter of timing, but supply will get addressed. So those engines-
Scott Buck (Managing Director of Senior Technology Analyst)
Yeah
Dhruv Shringi (CEO and Co-founder)
... will get repaired, those aircrafts will come back, right? So whether it happens with a delay of a quarter or two, that's, you know, between IndiGo and Pratt & Whitney to figure out, but the supply will come back. Whereas this is, or could potentially turn into a more secular trend when there are discussions which are happening between the airlines and the intermediaries in the country to come to, an equilibrium.
Scott Buck (Managing Director of Senior Technology Analyst)
Okay. That's, that's helpful. And then last one for me on the MICE business. It's nice to see you guys are, are starting to see some favorable momentum there. What is the typical contract structure? Are your customers under annual or, or multi-year contracts there? Just trying to understand from a visibility standpoint.
Dhruv Shringi (CEO and Co-founder)
So there are some customers at this point of time, given that it's still relatively early days, there are annual contracts which exist, and there will also be some which are more event-based and large event and cycle-based contracts. We are not yet at a stage, like our business travel, where we have multi-year contracts. Here we are not yet at that stage where we are signing straight-off-the-back multi-year contracts. Yeah, these are more, you know, short to mid-term kind of contracts which are there, as opposed to multi-year contracts. But as the business progresses and stabilizes, this should translate into multi-year contracts.
Scott Buck (Managing Director of Senior Technology Analyst)
Okay, perfect. Well, I appreciate the color, guys. Thank you very much.
Dhruv Shringi (CEO and Co-founder)
Not at all. Thank you, Scott.
Operator (participant)
The next question is from Amish Mahal, from Private Investor. The line is now open. Please go ahead.
Speaker 6
Hello, morning, thanks for taking my question. I have a couple of questions. One is, what percentage of your airline business is B2C? I thought it was a very, very small portion. So for this to have a 20% impact on your revenue seems a bit much. The second is, let's say the largest carrier's decision to go direct to customers, does it not also affect your corporate business? And maybe a third relevant question is, how is it that companies like MakeMyTrip don't seem to have been impacted by the same issues that you're pointing out? Sorry for the lots of questions, but I can repeat definitely as needed.
Dhruv Shringi (CEO and Co-founder)
No, thank, thank you for the question. So let me clarify the first point in terms of the share, and you would have heard this on multiple calls from us. The B2C business till last year was accounting for almost 50, between 55%-60% of our gross bookings. So it's not an insignificant part of our business, it's a fairly material part of our business, and that's the reason why the overall impact on the gross bookings, because of what's happening. Secondly, in terms of between us and MakeMyTrip, the impact on MakeMyTrip is exactly the same as the impact that we are facing.
The only difference, which is there, is that MakeMyTrip has taken the view of discounting on Air India and Vistara, which is the other airline in the country, quite meaningfully, to offset some of the volume that they're losing on IndiGo. You could do a quick search on any of the comparison platforms like Skyscanner or Google Flights, and you'll be able to validate that. In terms of overall numbers, obviously, MakeMyTrip has a scale advantage on hotels and bus, from where they're generating incremental profits, which are helping them subsidize some of this cross investment on the air side. But the challenge that we are facing is something that everyone in the country is facing, not just us. To your third point on the corporate side as to why would this not flow into the corporate segment?
The reason behind that is that on the corporate side, it's a managed travel services, where corporate employees have to go through our platform to book their business travel needs. Typically, what happens is these kinds of fares, which are offered on the airline site, which are direct, are the most restrictive fares with the least amount of value adds attached to them. Whereas corporate travelers, 95% of the corporate bookings that happen, happen on special corporate trades, which come in bundled with other flexibility, like cancellation protection or free seats being bundled with it, meals being bundled with it, and that is not something that IndiGo discounts directly.
The other thing which is also there is that on the corporate travel front, this entails a scenario where a company which employs 50,000 people has to then manage their employees going and booking IndiGo flights or some part of their IndiGo bookings directly, coming back and claiming that, while the rest of their travel is managed through the Yatra application and the Yatra portal for their business travel needs, including their approval process, including their expense management, et cetera. So that's not really a scenario which is quite easy for an airline to replicate. Even globally, if you look at the examples of people like Southwest, Ryanair, easyJet, their focus is on the leisure travel segment in terms of these kinds of promotional fares that they offer on their own website. This is not targeting the business travelers.
These fares also, just to give you an indication, typically will be there for advanced booking. That's where the bulk of the leisure travel happens, whereas business travel typically happens in a D minus three, which is travel date minus three days kind of booking window. In that window, these fares are typically not available. I hope that clarifies your questions.
Speaker 6
Yeah, you did. Thanks a lot, I mean, really appreciate the details behind it. Just an additional question, if I may. The meeting management solution, that, or expense management tool that you launched, do you already have some traction with the mid-market segment that you are targeting? That's the question.
Dhruv Shringi (CEO and Co-founder)
Yeah, so we are currently running a pilot of that with a few of our customers, with a handful of our customers. That's the first phase, which is there. We are also in discussions with some of our larger customers to see if this can replace more expensive global solutions, which are currently being used by the larger customers. But the initial subset that we are targeting is more on the mid-tier segment.
Speaker 6
Thank you. Appreciate it.
Dhruv Shringi (CEO and Co-founder)
Thank you.
Operator (participant)
Thank you. The next question is from Cobb Sadler from Catamount. The line is now open. Please go ahead.
Cobb Sadler (Founder)
Hey, guys. I have a question on the potential acquisitions that you may do. I think it was 2? Is it one or more than two? And then also, what is the revenue size of these deals as it relates to the corporate business? I mean, is it gonna double the corporate business? 20%, 50%? And then I have some follow-ups.
Dhruv Shringi (CEO and Co-founder)
So, Cobb-
Cobb Sadler (Founder)
The timing.
Dhruv Shringi (CEO and Co-founder)
The acquisition-
Cobb Sadler (Founder)
Sorry, excuse me, and the timing of completion of these deals. Sorry, go ahead.
Dhruv Shringi (CEO and Co-founder)
Sure. So, Cobb, these are, you know, deals which are currently. It's hard for me to comment on an exact timing for ongoing discussions or dialogues that may or may not be happening. We've said that we are evaluating multiple options. It's hard to give an exact timing to closure of any of the acquisitions. I don't want to set any expectations in terms of timing from a closure point of view. These are discussions which are ongoing, and there are multiple sets of discussions which are ongoing. Our endeavor through the M&A part, and if I look at, you know, I can guide you to what we've said from an India IPO standpoint, we've earmarked approximately $20 million for an acquisition or for multiple acquisitions.
Whether this translates into one or multiple acquisitions, only, you know, once it's crystallized, would we be able to share more details on that. Till such time, there is no commitment in terms of that there is an acquisition which is actively going to happen in the near term.
Cobb Sadler (Founder)
Okay, but you have aspirations to close some deals, I would assume. And so the number, was that $20 million what you would pay or the revenue that you'd like to add?
Dhruv Shringi (CEO and Co-founder)
$20 million is what we have set aside as IPO proceeds in terms of an acquisition.
Cobb Sadler (Founder)
... Okay, so you would use the cash-
Dhruv Shringi (CEO and Co-founder)
You know, or up to $20 million-
Cobb Sadler (Founder)
Yeah.
Dhruv Shringi (CEO and Co-founder)
Would be potentially the payout for acquisitions. This could be for one acquisition, or this could be for multiple acquisitions.
Cobb Sadler (Founder)
Could you use stock also, or is the $20 million the cap?
Dhruv Shringi (CEO and Co-founder)
From a regulatory standpoint, when you do an IPO, you have to call out what are the end users of the IPO proceeds, and then the end users in the Indian IPO, with EMR, approximately $20 million for IPO, for acquisitions.
Cobb Sadler (Founder)
Okay, and you would use cash solely, or could you use stock also and buy more revenue?
Dhruv Shringi (CEO and Co-founder)
Yes. So we could use stock as well. There is nothing that holds us back from doing a stock plus a cash deal. Yeah.
Cobb Sadler (Founder)
Okay, got it. All right, and the timing, I mean, how long have you been at this? Like, I guess, like, you know, why don't you have an idea on timing?
Dhruv Shringi (CEO and Co-founder)
Cobb, your question is then implying that there is an active acquisition which is ongoing, and I'm-
Cobb Sadler (Founder)
Yeah
Dhruv Shringi (CEO and Co-founder)
... clarifying that, you know, I can neither confirm nor deny any such thing, that there is an active acquisition-
Cobb Sadler (Founder)
Okay
Dhruv Shringi (CEO and Co-founder)
... conversation that is going on.
Cobb Sadler (Founder)
Okay. All right. That, that's fair. And then, on the fungibility of shares, did I get this right? You said 6-12 months, you think you'd have an answer there, or was that an answer to... Was that a. The question was how long will it take you to, or my question is, how long will it take you to know whether or not the shares will be fungible? Then the other question is, what do you think that the Indian investor base would think about that?
I mean, I'm guessing they don't-- the structure, as I understand it, you're kind of the first dual listing company in India, and so my guess is they're all confused, as probably all investors are about, about the structure. So do you think that would be a positive for them if you were able to collapse the structure? That's one question. And then, do I have it right that you think that fungibility, if it were to occur, would occur within 6-12 months?
Dhruv Shringi (CEO and Co-founder)
Yeah. So in terms of the second part, based on the discussions that we've had with various advisors across multiple jurisdictions, 6-12 months could potentially be the timeline for a fungibility event. As I said, given that there are multiple regulators involved in this, it could be a lengthier process, but our best estimate at this point, based on the advice that we have from the counsel that we have in different jurisdictions, it is an event which could take, you know, up to 12 months.
Cobb Sadler (Founder)
Okay. And the multiple entities that are involved, is that. So you probably have the SEC, and you probably have SEBI. Is there other regulatory agencies or bodies that need to sign off?
Dhruv Shringi (CEO and Co-founder)
So these are the two main bodies. There is the SEC, and then there is SEBI. There will also be, you know, tax clearances, et cetera, which will be needed in India, depending on the structure that we adopt, or it could also be Indian courts, if it's a merger structure that we adopt. So there are a couple of options that we are working closely with, and in each one of them, there are different sets of regulators that are involved in the process. As you rightly also pointed out, this is a fairly unique scenario. There aren't enough precedents of a scenario like this that one can look at and use that as a basis of saying, "Here is a more definitive timeline for doing something like this.
Cobb Sadler (Founder)
Okay, and I guess by doing this, you will eliminate some overhead costs, filing costs, legal costs, management costs. Would you collapse the boards? Maybe you have some board costs that are eliminated. Do you know, do you roughly have an estimate of how much costs would be eliminated, associated with the collapsing of the listings if that were to occur?
Dhruv Shringi (CEO and Co-founder)
Sure. So today, there is approximately $2 million-$2.5 million of costs, which is associated with being a U.S.-listed entity. That cost would go away on collapsing of this structure, or large part of that cost will go away on collapsing of this structure.
Cobb Sadler (Founder)
Okay. All right, and then, just on the expense management product, could you just talk briefly about... So you're, it sounds like it's... Did I get that right, that you said that you may see some revenue? Is, was that revenue from new, newly added corporate customers or expense management? I didn't hear that clearly. When do you think expense management, the revenue could actually start to be somewhat meaningful? And then I have a follow-up on expense management.
Dhruv Shringi (CEO and Co-founder)
For the revenue-
Cobb Sadler (Founder)
The first one is timing revenue.
Dhruv Shringi (CEO and Co-founder)
Sure. So for the revenue to be material on the expense management front, I think we are looking at more at, like, next fiscal year for the revenue to be material. At this point in time, we are going through a process where, you know, we are inducing trial with our customers. We are offering it to some of our customers as an initial bundle proposition for a period of time where it's free to use, right? Or there is a premium kind of service, which is there, that certain features are available to them, free to use, and beyond that, then they have to look at a pricing model. So in this year, at least, I feel it's going to be still relatively immaterial from an earnings point of view, but next fiscal year it will become more relevant.
Today, the focus is trying to make sure that we can get a larger install base on the expense side, as opposed to looking at monetizing that on day zero.
Cobb Sadler (Founder)
Okay, and the product, you know, is it kind of a—is it a, I believe you said that you're gonna target both, but initially, and the way software typically worked is SMB. Is it fully featured? I mean, so I guess, is your competitor Zaggle a Zaggle type company? And are your features and functionality similar to the more fully featured suites? Or is it kind of a basic product to start for SMB that don't want to pay for something like Zaggle or another competitor?
Dhruv Shringi (CEO and Co-founder)
Today, the product is in a situation where... or in a shape where it can definitely compete with the likes of Zaggle in terms of the expense side of things. What we are looking at out here is a solution which uses a lot of the new GenAI large language models for receipt analysis, which is much more advanced than the older models or older tools, which use OCR-based recognition. OCR-based recognition, by its very nature, has a limited amount of accuracy, whereas the LLM models, because of their self-learning aspects of theirs, tend to be much better in terms of analyzing the expenses and capturing of the data. So we feel, you know, the solution is fairly comparable with the other mid-market proposition products which are available today.
The advantage which is there is that it comes in as a tightly knit, or can be offered as a tightly knit solution between travel and expense, or it can be sold singularly as an expense solution as well. That is the advantage that we are offering to customers, especially those who are our existing customers, that they can provide a more seamless experience between travel and expense for their employees.
Cobb Sadler (Founder)
Okay. All right, and then, just back to the fungibility. I guess you have some investors, U.S. investors that have FPI licenses, that can actually just, as I understand it, can actually just take Indian shares and then, you know, hold them, buy more, sell some, whatever. And then you have some that, some U.S. investors that do not have FPI licenses, they're smaller. And so, how would that work with them? They would. Would you have, would Indian investors acquire the U.S. shares from, if they wanted to sell, of U.S. investors? Or would there be some sort of offering, or would there be some sort of private equity firm that would come in?
And I'm just guessing overall, you know, the marginal Indian investor would be more likely to acquire shares. I mean, I'm assuming there are some Indian investors that don't like the structure and would then want to add or buy for the first time shares. And so, that should be a very positive event. But I guess going back to the SEBI situation, how would you handle? If they have a SEBI license, it's not a problem, but if you don't have one, then what do you do?
Dhruv Shringi (CEO and Co-founder)
So if that does turn out to be the route that we go down, at that point, we will also see, you know, what assistance we can provide through local bankers out here to make sure that, you know, the shareholders are able to get access to the shares. So that's something that, you know, we will try and do from our side, but it's only something that will come up much closer to once the option gets finalized. And we will factor this into our decision-making process as well, as to how easy or difficult would it be for the shareholders to get access to the India shares.
Cobb Sadler (Founder)
Okay. All right. That sounds good. I mean, that's a major net positive, in my opinion, because our U.S. shares are trading at a huge discount. So, good luck in collapsing that. Thanks.
Dhruv Shringi (CEO and Co-founder)
Sure. Thank you. The only word of caution that I want to put out there, for abundant reason, is that from a timing point of view, it is a slightly lengthier process. So I want to just let that out there, so that from an expectation setting point of view, we don't set the wrong expectations with shareholders.
Cobb Sadler (Founder)
I understand that, but you did say 6-12 months?
Dhruv Shringi (CEO and Co-founder)
That's right. That is right.
Cobb Sadler (Founder)
Okay.
Dhruv Shringi (CEO and Co-founder)
That's the kind of timeline that we are working toward, based on advice from advisors.
Cobb Sadler (Founder)
Okay, roger that. Thank you.
Dhruv Shringi (CEO and Co-founder)
Sure. Thank you.
Operator (participant)
Thank you. If you would like to ask a question, please press star followed by one on your telephone keypad now. When preparing to ask your question, please ensure your devices are muted locally. The next question is from Amish Mahal. The line is now open, please go ahead.
Speaker 6
Thanks for taking my additional question. Just a question actually on the buyback of the U.S. shares. You, you had completed a buyback of $5 million. Is there any reason why the number should not be higher, considering the steep discount and the best use of corporate funds? I realize it's a board decision, but I wanted to know whether there's a rationale for capping it at $5 million.
Dhruv Shringi (CEO and Co-founder)
There is no capping on that. It's just, you know, that as we go through this process, we are evaluating multiple options, and we might also need to conserve some cash for doing the larger restructuring that we spoke about. So once we have greater clarity on the route that we are going down, at that point, we can evaluate if the buyback needs to be expanded, or we do this in one go as part of the restructuring.
Speaker 6
Okay, thank you. That's very clear.
Dhruv Shringi (CEO and Co-founder)
Sure.
Operator (participant)
Thank you. As we currently have no further questions, I will now hand back to the management team for closing remarks.
Manish Hemrajani (VP of Corporate Development and Investor Relations)
Thank you, everyone, for joining the call today. As always, we are available for follow-ups. Please feel free to reach out for the same. Kiki, you can now close the call. Thank you.
Dhruv Shringi (CEO and Co-founder)
Thank you.
Operator (participant)
Thank you. This concludes today's conference call. You may now disconnect your lines.