In an interview, Prakash Sangam states that the company is doubling down on inventory expansion and digitisation in smaller towns
Emphasising that travel within smaller tier 3 destinations has grown more than overall travel due to improved road infrastructure and increased digital penetration, Prakash Sangam, the Chief Executive Officer (CEO) of redBus states that the company expects growth to come from these areas.
In an interview with BW Retail World, the CEO notes that they are doubling down on inventory expansion and digitisation in smaller towns as around 60 per cent of its passengers travel from these areas currently. Sangam also points out that while the policy environment and infrastructure have been highly conducive to the growth of the intercity bus industry, making bus terminals accessible to private operators would result in better customer experiences. Edited Excerpts:
How is FY26 shaping up for redBus in terms of bookings, revenue momentum, and new user additions?
FY26 has been a promising year for us, with good growth momentum across all parameters. In the first half of this financial year, we have seen a strong 36 per cent growth in seat bookings year on year while revenue has increased by 39 per cent in constant currency. While these numbers represent our global bus ticketing business, India growth trends are broadly similar and this momentum has continued into the second half of the year as well.
What are the biggest shifts in traveller behaviour this festive season, from booking windows to preferred routes and bus categories?
The biggest shift in behaviour has been the increase in travel to pilgrimage destinations. In this season (October to December), we saw strong growth patterns, particularly in October, a over 40 per cent growth in seat bookings (compared to October 2024) for pilgrimage destinations. This possibly coincided with Dussehra and Diwali. Notably, this cohort (pilgrimage) tends to make relatively early bookings and group bookings (more than two persons).
Looking ahead to 2026, what travel patterns do you foresee across domestic tourism and tier-2/3 mobility, and what will be redBus’ top strategic priorities?
We expect pilgrimage destinations to continue to see growth, and starting 2026 on a strong note, expect growth volumes for Magh Mela in January and February, especially around the Delhi- Ayodhya- Varanasi- Prayagraj corridor.
Currently, around 60 per cent of our passengers travel from smaller towns (not metros or state capitals) and we expect growth to come from these areas. We continue to double down on inventory expansion and digitisation in smaller towns. We are catering to these segments with initiatives like local language interfaces, for instance, we recently introduced Marathi language interface to go with Hindi, Tamil, Telugu and Kannada that are already live.
With the latest AI now enabling superior natural language and voice processing capability, we will experiment with this too to enable large sections of digitally excluded populations to experience the convenience of online bookings. Additionally, our marketing efforts also focus on regionalisation for the state, using lingo and artwork that resonates with locals.
What are the standout holiday travel trends this December, top destinations, traveller profiles, or unexpected surges?
This December, we see that the travel volumes for leisure destinations have caught up with travel to pilgrimage destinations; for most of the year pilgrimage destinations have seen much higher volumes. In the northern markets, travel is mostly to hill stations, while the rest of India seems to be headed towards Goa.
Delhi-Manali, Goa-Bangalore, Goa-Hyderabad, Delhi-Kasol, Delhi-Shimla, are the top routes for leisure destinations in December. We see that people are travelling to these destinations as groups, possibly families and friends travelling to celebrate the year end. This is in contrast to non-festive travel, which is dominated by solo travel with people commuting for work and studies. We also expect strong travel trends around the Christmas-New Year period.
We have also seen unexpected surges in the first week of December, coinciding with issues in the aviation sector.
Where do you see the biggest bottlenecks and what policy interventions would help streamline mobility?
The policy environment and infrastructure have been highly conducive to the growth of the intercity bus industry. Policies such as all India tourist permit rules have helped the sector make significant progress as they clarified issues and allowed operators to cross state boundaries seamlessly.
However, there is always more to be done. On the infrastructure front, making bus terminals accessible to private operators would result in better customer experiences. Dedicated, multimodal bus terminals would make travel far more convenient, especially for senior citizens and families with children.
Another area where change would be beneficial are the GST rules for non-AC bus tickets. This category is exempt from GST except when the same ticket is purchased online through an OTA like redBus. This policy penalises the price sensitive segment of non-AC bus travellers for availing the convenience of booking online.
Pricing volatility during peak seasons often frustrates travellers. How do you see the sector balancing market-driven pricing with consumer expectations for transparency and fairness?
Let me get a disclaimer out of the way – we are a technology marketplace enabling listing of bus services by bus operators and discovery and booking of those services by travellers. Pricing is entirely the prerogative of bus operators and prices are set by them. On its part, redBus does not charge any convenience fee or service charges from customers.
Now coming to pricing, like in any well-functioning market, pricing is a function of demand and supply. It is important to note that the average seat price (ASP) in 2025 is very similar to the ASP last year, showing overall stability. While prices spike during peak travel periods such as the summer vacation period, festive season such as Dussehra, Diwali, long weekends and large events like the Kumbh mela, equally during lean travel periods, prices also come down sharply. The average seat price this year has been Rs 964, which is pretty much the same as last year.
Compared to other modes of intercity travel that need either dedicated tracks or landing slots, bus supply or inventory can flex in response to changing demand where many more buses can be added during periods of higher demand as there are limited constraints for doing so.
Which routes and emerging corridors are driving the fastest growth, and what’s behind their rising popularity?
Pilgrimage routes have been one of our standout growth drivers this year and have seen accelerating growth, year on year and all across the country, going beyond the traditional destinations such as Tirupati, Shirdi and Katra. Overall, travel on pilgrimage routes witnessed 44 per cent higher growth, than pan India average.
In the North, the Delhi- Ayodhya- Varanasi- Prayagraj corridor saw strong growth. In the South, Tamil Nadu has witnessed unprecedented pilgrimage travel with destinations such as Tiruchendur, Thiruvanamalai, Palani and Thanjavur in focus. In the West, the destinations witnessing a lot of growth have been Katu Shyamji & Ujjain; and in the East it is Puri.
With improved road infrastructure and increased digital penetration, we have seen a significant upswing in travel from and towards smaller, tier 3 destinations. Travel within smaller tier 3 destinations has grown more than overall travel – tier 3 routes saw 19% higher growth compared to pan India average.
What key investments or product innovations, such as live tracking, safety features or AI-led personalisation, will define your 2026 roadmap?
AI will continue to be a key area of focus for us. Over the past year, we have deployed AI extensively in post-sales support, which has helped us significantly improve turnaround times, reduce contact ratios and enhance overall customer satisfaction at scale.
Going forward, our focus is on thoughtfully embedding AI deeper into the pre-sales journey. The objectives are twofold. First, to make discovery simpler and more intuitive through natural-language interactions, both text and voice, and second, to deliver a far more personalised booking experience. Done well, this not only makes booking more delightful, but also helps bring new customer segments into online ticketing across a large and diverse market like India.
On the supply side, we see a strong opportunity to use AI to drive greater adoption of digital tools among bus operators, many of whom are small and mid-size, helping them improve service delivery, enhance safety outcome, and unlock incremental revenue through smarter route planning and automated pricing.
