Cityflo plans to expand its fleet as demand revives

Jan 7, 2023

Mumbai: Led by a strong revival in demand for last-mile people mobility, premium bus transport provider Cityflo intends to expand its fleet 10 times to 1,300-1,500 luxury Mercedes-Benz buses in the next two years. To fund this expansion, the Mumbai-based company plans to raise about ₹125-150 crore, which will be used in partnering with more fleet operators and marketing the service on new routes in Mumbai and Delhi.

Founded in May 2015 at IIT-Bombay by Jerin Venad and his friends Ankit Agrawal, Subhash Sundaravadivelu, Rushabh Shah, Advaith Vishwanath and Sankalp Kelshikar, Cityflo has started getting significant traction in business after the Covid pandemic.

"We are growing super-fast, especially after the third wave," Venad told ET. "We are adding new buses, we are adding new routes, we are confident of growing 4x this year and in FY24 we will be further looking to grow 2.5 times. Hence we are planning to replenish our fleet."

With plans of offering comfortable premium commute in key routes for office goers in Mumbai and New Delhi, Cityflo aims to ferry more than 100,000 people daily from 7,500 at present. It claims this would help in a significant decongestion in city roads and reduce emission. The service that is available on 17 routes with 150 buses will be expanded to more than 150 routes and 1,500 buses in two years in the two cities, Venad said. The company generated a turnover of ₹20 crore in FY22 and is aiming for ₹35-40 crore and a profit in the current fiscal 2023. The target is to grow the revenue more than 10-fold in the next two years with the addition of new buses and routes, Venad said.

Cityflo is seeking to offer the car owner an alternative that is comfortable, clean and premium to commute to work, he said.

"We are operators of buses, so the idea is how do we offer an alternative that is better for the car owner. How can we go closer to home, use data to define routes, minimise the stops, deliver travel time that is the same as the car, and offer subscription which is flexible, wherein rescheduling is possible," he added.

Cityflo currently has tie-ups with 40 operators. It aims to have half the cumulative fleet to come from the transporters and the balance from new investors. It offers assured business to the partners. Siddharth Talwar, partner at Lightbox, who invested a little over $6 million in Cityflo just ahead of Covid-19, said he had full faith in the business model.

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