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Radio taxi service provider Meru Cabs is planning to expand its economy segment brand Genie in small cities by launching it in 20 cities in next 18 months.
The company is also expecting around 35% of its overall revenue by 2017-18 to come from this brand, while the rest would be from its flagship brand Meru.
Speaking about the future plans after announcing launch of the cab service in Chennai, Siddhartha Pahwa, CEO of Meru Cabs said, "We are currently doing a pilot project on the Genie, the hatchback cab service in a lower cost, in three cities and will start launching more cabs in the next two months."
He added that the company would be launching the Genie cabs in 20 more cities in 18 months, while the Meru cabs it is looking at launching in 12 cities by the time.
Currently, the company has around 200 hatchbacks in Bangalore, around 150 cabs each in Hyderabad and Pune and the pricing is around Rs 16 per kilometer. The company would be looking at tier II cities where the population is not big, while in larger cities a mix of sedan and hatchback would be more successful. The brand Meru would continue to offer only Sedan cabs for customers.
"We are only in pilot stage and the revenues are not much from Genie. Our intent is to have around 30-35% of our total revenue from Genie by 2017-18," The current revenue is around Rs 450 crore and the company is growing at around 30-35% compounded annual growth rate (CAGR), he added.
It would also increase its overall brand spend from the financial year starting April 1, 2014. So far, it has spent around Rs 15 crore in brand building across the country, which would go up to Rs 20-25 crore from the fiscal year 2014-15.
Chennai is the seventh city the company is entering into and Pahwa said that the company has been focusing on strengthening its operations in the existing cities in the initial years and is currently looking at expanding to more cities. Plans are to expand operations to at least 10 new cities in the next one year.
"Our plans are to grow to 1,00,000 cars across the country by the year 2022," he said.
In Chennai, the market requirement would be of around 20,000 cars, while the current supply in organised sector is around 7,000-8,000 cabs, which shows the potential for the company. The company is launching a mobile application for the customers and also free of cost trip tracker, which alerts one number provided by the passenger about the movement of the cab.
The company would also launch Genie brand in Chennai in next three to four months, with a 20% lower price than the price of Meru, said Pahwa.
