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Thomas Cook India, an Indian travel agency, has witnessed a pent-up demand for student overseas forex. Surprisingly, the demand is coming from Tier-2 and -3 cities. Amid the pandemic, there was a noticeable trend of restricted student travel overseas. However, forex remained active and played a crucial role in supporting students’ livelihoods through forex transactions, according to Deepesh Verma, Executive Vice-President – Foreign Exchange, Thomas Cook (India) Limited
“We saw over 2X growth in turnover from students travelling overseas from Tiruchi, Goa, Meerut, Puducherry, Mangaluru, Salem, Madurai, Pathanmitta, Phagwara, Kolhapur, Baroda,” he told businessline.
The overseas education market is pegged at $3.6 billion with nearly 7 lakh students travelling this year. This number is expected to double in the next three years. Tier-2 and -3 cities contribute to nearly 60 per centof education portfolio, he said.
TCIL student corridors for tier-2 and -3 are UK (34 per cent), Canada (25 per cent), US (23 per cent), Australia (9 per cent), and Europe (7 per cent). The average spend on forex by students in tier-2 and -3 cities was $4,950 against an average spend of $5,700 by tier-1 cities.
Varma said that due to increased income levels, a strong desire to study abroad, and readily available student loans, there has been a remarkable growth in turnover of more than 2x from India’s tier-2 and -3 cities. He also highlighted the surge in digitisation, and accessible counseling services, which contribute to added convenience.
Revised outlook
Thomas Cook’s forex business serves over 1 million retail customers annually, via its website, FXNOW (m-app and corporate booking tool), call centre, and 100+ Forex stores located across 65 metros, tier 2-4 cities/towns pan India. The business also serves over 1,000 corporate clients, 1 million+ active Forex prepaid card users. Over one lakh students study overseas using fees and other remittance services of the company, says a release.
In January, Crisil Ratings revised its outlook on the bank loan facilities and corporate credit rating of Thomas Cook to ‘Stable’ from ‘Negative’, while reaffirming the ratings at ‘CRISIL A+/CRISIL A1’.
The outlook has been revised due to a robust recovery in business momentum as the pandemic impact lessens, strong support from Fairfax Financial Holdings Ltd, healthy liquidity leading to a negative net debt position, and a solid capital structure.
The group leads both the wholesale and retail forex segments, benefiting from strong relationships with major banks and a wide distribution network. Additionally, the group holds a dominant presence in the organised travel business across retail and corporate segments with high geographical diversity and a strong brand image.
Share price of Thomas Cook on the Bombay Stock Exchange closed at ₹84.18, up by 0.14 per cent.
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