Companies

Helios Travel set to drive up competition in radio taxi services

Venkatesh Ganesh Bangalore October 9 | Updated on January 24, 2018 Published on October 09, 2014

To launch services in Bangalore soon, and other cities by January

Helios Travel Solutions, a car rental company that provides taxi services to corporates in India, plans to start radio taxi services, taking on the likes of Uber, Meru, Olacabs and TaxiForSure.

The company officials that BusinessLine spoke to said radio taxi services will be launched under the brand name of ‘Magicabs’ across the country and will not be restricted to metros.

“We see an opportunity in metros and other tier-II cities, despite other players being present in that segment,” said B Rajiv, CEO of Helios.

Unorganised market

The company, with a fleet of 100 cabs, wants to kick off in Bangalore and launch in other parts of the country by January. When asked the reason for this change in strategy, George Abraham, Director, Helios, explained that according to their research, the market for consumer taxis is highly unorganised and the organised players such as TaxiForSure have garnered a mere 6-7 per cent of the ₹60-crore market.

Cash flow delay

Also, the company believes that since it has 700-owned taxis across India, launching consumer taxi services would be a natural extension of its existing business.

Industry watchers also point to possible delay in cash flow for taxi companies catering to corporate clients.

“The credit cycles in corporate taxi business can be anywhere between three and five months, whereas in the consumer-facing business, it is almost immediate,” said Deepesh Agarwal, Co-founder, Moveinsync.

Pent-up demand

Also, according to a September 2012 report from IDFC, the vast majority of urban India does not have any organised mass public transport.

Of 78 cities with a population over half a million, only 20 had public city buses in 2009, and five cities have rail-based public transit.

This pent-up demand is attracting global investors to invest in companies that provide cab services.

Companies such as TaxiForSure and Olacabs have raised investments from venture capitalists in the last couple of years.

Published on October 09, 2014
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