RateGain: It borrowed to buy Sojern, and now earns per booking or campaign

Small cap Travel technology 15 September 2026 · 41 min read · Part 1: 3 min · By Pranami Hayaran

What the company does

RateGain sells software and advertising to hotels, airlines, car rental firms, travel websites and tourism boards. Its tools show what rivals charge, push a hotel's rates and rooms to the sites that sell them, and, since it bought Sojern in November 2025, buy the ads that bring a traveller to book on the hotel's own site. In FY26 it made ₹1,823.6 crore of revenue and ₹194.4 crore of profit after tax. It has no factory: 1 office in India and 11 abroad and 1,255 staff. It listed on NSE and BSE in December 2021. The promoter is Bhanu Chopra, who started the business in 2004; he and his family hold 48.78%.

Why this company, why now

The share price and the profit have gone opposite ways.

The share closed at ₹438.15 on 30 March 2026, 5 months after the Sojern deal and 6 weeks after a one-off charge hit profit, and at ₹990.05 on 21 August 2026, 2 weeks after the June quarter's results: 2.3 times higher in under 5 months. The At a glance card above has today's price, market value and P/E.

RateGain's share more than doubled from its March 2026 low to August

RateGain's closing share price on NSE, September 2025 to October 2026. It fell to ₹438 on 30 March 2026, after the Sojern deal closed, and reached ₹990 on 21 August 2026 after the June quarter's results.

₹ per share, closing price

30 March 2026: ₹438, the low of the Sojern year

NSE end-of-day prices · 10 September 2025 to 9 October 2026

FY26 brought ₹1,823.6 crore of revenue, up 69.4% but profit after tax fell 7%, to ₹194.4 crore; the year began with ₹1,267 crore of cash and investments and ended with ₹722 crore of net debt.

What the market believes. At ₹990 it priced a software company that doubled in size, growing at 187.6% with a 24.6% margin. The family bought through the fall; mutual funds sold, Sundaram Small Cap apart, and Plutus Wealth sold most of its stake near the low (Shareholding). The dissent on record came from analysts: Burman Capital worked out on the August 2026 call that Sojern must run at nearly a 30% EBITDA margin, which management would not confirm or deny; Niveshaay asked in November 2025 why, if the products were so good, the company could not grow organically; AK Investments asked in February 2026 for Sojern's net revenue and heard "We will avoid reporting those kind of numbers."

Where the filings differ. The growth was bought with savings and a loan: 7.5% organic growth in FY26, a 21.9% reported margin, a profit that fell in the year revenue jumped most, and an ad business whose own numbers are withheld. Most of the money now comes from buying ads for hotels and tourism boards, paid when the ads bring bookings. The questions are whether an ad business deserves a software price, and whether the money customers owe turns into cash.

History

Bhanu Chopra holds a business degree from Indiana University and began his career at Deloitte in 1998. He began operations in 2004 with a tool that compared hotel prices. Sabre has been a customer since 2003, the oldest relationship in the prospectus. The listed company was incorporated on 16 November 2012 as Ridaan Real Estate Private Limited; the business moved into it by a court-approved demerger in 2014.

• 2004 to 2017. Rate comparison for hotels, then airlines, car rental firms and OTAs. Megha Chopra, his wife, joined the board at incorporation.
• 2018. Bought DHISCO, a US hotel distribution switch, now the Distribution business; the IPO prospectus set aside ₹25.2 crore of the proceeds for DHISCO's deferred price.
• 2019. Bought BCV Social, a US social media agency for hotels, now SoHo.
• 2021. Bought Myhotelshop, a German metasearch ad buyer. Before the IPO, 65.42% of the shares were held by the promoters, the rest by 2 investors, Wagner and Avataar.
• 17 December 2021. Listed at ₹425 a share; most of the IPO was the promoters and investors selling (Shareholding). On 30 June 2022 the share closed at ₹238.95.
• January 2023. Bought Adara, a US travel data and ad company (Capital allocation), already Sojern's rival for tourism boards' budgets.
• November 2023. A QIP to institutions, for acquisitions (Shareholding).

The last 2 years are under Recent developments.

How the business works

The same room for the same Friday can carry 3 prices on 3 websites. A hotel's revenue manager picked each: watched what nearby hotels charge, set a rate, sent it to every site that sells the room, and checked that nobody undercuts the hotel. RateGain sells a tool for nearly every one of those jobs, and now buys the ads that bring the guest back to the hotel's own site.

How RateGain prices, sells and gets paid for a room

Read top to bottom: the shaded steps are RateGain's own, the rest belong to the hotel, the traveller and the lenders.

RateGain annual report FY26, investor presentations, call transcripts and the Sojern loan filings · FY26 and the June 2026 quarter

Who sets the rules. The OTAs and the global distribution systems. Online travel agencies (OTAs) charge hotels "15% to 30% of each booking", RateGain's website says, and when one undercuts the hotel's own site, "When OTA wins, --hotels lose twice--": the direct booking, and commission on it. Google, Meta and the metasearch sites price the ads Sojern buys. RateGain sets none of these prices.

Who does the work. RateGain's own steps are the shaded ones in the graphic: it collects prices from the sites that sell rooms, pushes a hotel's rates to those sites and to the GDSs for chains (Products and segments), and, through Sojern, buys and places the ads.

Who holds the power. The OTAs and the ad platforms, on both sides of RateGain's customers; in one place, tourism boards' budgets, the Sojern deal moved it towards RateGain (Pricing power).

Could the customer do this in-house? The big chains could, and some have. When an analyst said in November 2025 that revenue managers at Accor, Hilton and Marriott saw chains moving to their own software, Bhanu Chopra replied that most big chains had moved the other way, to third-party reservation systems that connect through RateGain. A small hotel cannot build any of it, which is why Sojern's thousands of small hotels were the prize (Capital allocation).

How the money is earned. As the annual report states it:

• DaaS: a yearly subscription, or a hybrid of a fixed fee and a charge per use for extra data. Hotels subscribe; OTAs, airlines and car rental firms pay the hybrid.
• Distribution: a yearly subscription for UNO and a fee per booking for Enterprise Connectivity.
• MarTech: a subscription and a campaign fee; in practice Sojern's 15% commission after the stay, a price per thousand ad views or a share of the budget.

The OTAs and GDSs also pay, for connectivity; which side pays the Distribution fee per booking is not stated in any filing.

The mix has turned over: 48% of revenue came from subscriptions in the 5 months to August 2021, just before the IPO; 42.5% of revenue was paid per transaction in FY25; 79.1%, with subscription down to 7.3% by the June 2026 quarter. The accounts agree: in FY26 ₹1,605 crore of revenue, 88%, was recognised at a point in time, when a booking or sale happened rather than spread over a subscription, against 67% 3 years earlier.

Revenue per customer is not usable: the customer count (Customers) gives ₹33.4 lakh in FY25 and ₹13.6 lakh in FY26, which says only that Sojern's customers are small hotels, and in some products a client counts as 1 and in others as 1,000, the CFO at the time said. RateGain stopped publishing annual recurring revenue in August 2025 because more than half the business was now transactions.

Products and segments

RateGain reports 1 operating segment, so the profit of each business cannot be seen. Revenue can, in 3 parts.

DaaS, data as a service. Navigator checks "over 1,100 data sources", more than 800 OTAs among them, and tells a revenue manager where the hotel's price sits against its rivals. Parity+ catches any site underselling the hotel's own website, with real test bookings, screenshots and vouchers as proof. AirGain does the same for more than 300 airlines, Rev-AI for car rental firms. DaaS made ₹368.0 crore in FY26, 20.2% of revenue and grew 7.8%, picking up to 22.7% in the June 2026 quarter.

Distribution. UNO, for independent and mid-size hotels, updates rates and rooms on more than 400 sites. Enterprise Connectivity links large chains to OTAs and to the global distribution systems (GDSs) travel agents book through; RateGain's website says 2 out of every 5 global GDS hotel bookings pass through it. It handled 31.22 million bookings in FY19, before Covid, and 9.02 million in FY21. Distribution made ₹195.6 crore in FY26, 10.7% of revenue and shrank 12.4%.

MarTech, marketing technology. Now mostly Sojern: ₹1,260.0 crore in FY26, 69.1% of revenue, and more than 81% in the June 2026 quarter. Sojern runs small and mid-size hotels' ads on search, metasearch, social media, email and websites, pays for them itself, and is paid only after a guest books and stays (How the business works). Bigger hotel brands pay per thousand people who see an ad, or a share of their ad budget. Tourism boards club together with local hotels and attractions for joint campaigns. SoHo, the former BCV, runs hotels' social media.

Which one earns the margin is not disclosed. The signs point to DaaS, sold by subscription with costs of servers and staff: the group's gross margin fell as the ad business grew (Margins and quality of earnings). Management is pushing MarTech, where the Sojern money went (Capital allocation), and AI tools in Distribution, where revenue is shrinking.

The 3 businesses over the years, revenue by type of service being the only split in every annual report from FY22 to FY26.

Sojern made MarTech 69% of RateGain. Distribution shrank.

Revenue by type of service, the only split RateGain gives. It reports a single segment, so there is no profit figure for any of the 3 businesses.

₹ CRORE, CONSOLIDATED

FY23FY24FY25FY26

Down 12.4% after a parent group shut the OTA that sent RateGain the most bookings

FY26 MarTech includes ₹666 crore from Sojern between 6 November 2025 and 31 March 2026. That is RateGain's figure, and it may include some Adara revenue after their March 2026 merger. Adara, bought in January 2023, is also in MarTech.

RateGain annual reports, revenue from contracts with customers · FY23 to FY26

DaaS went from ₹161.8 crore in FY23 to the FY26 figure above, most of the jump coming with Adara's data business in FY24. Distribution went from ₹194.3 crore to ₹223.2 crore in FY25 and back to just above where it started. MarTech went from ₹209.0 crore to the FY26 figure above, with Sojern.

Where the capital went. The stated focus is an integrated revenue platform; the money went to MarTech, Adara and then Sojern (Capital allocation), and almost none anywhere else (Working capital and cash flow). Goodwill by business at 31 March 2026: MarTech ₹1,568.7 crore, DaaS ₹10.7 crore, Distribution ₹1.5 crore.

Customers

RateGain counted 3,224 customers at the end of FY25 and 13,410 a year later, the jump being Sojern's, then 14,158 at 30 June, across more than 160 countries by the website's count. It says it works with 33 of the 40 biggest hotel chains. Named in filings and on the site: IHG, Sabre, the oldest (History), Singapore Airlines, Red Roof and Airbnb, "a big customer" in management's words.

Concentration. The 10 largest customer groups bought 20.50% of revenue in FY26, against 29.53% in FY25, the fall being Sojern's thousands of small hotels. No single customer passed 10% of revenue in FY26 or FY25. In FY21, before the IPO, the top 10 were 37.01%. The top 1 and top 5 are not disclosed.

Why they buy here. Scale of data and connections (Competitive advantage). Bhanu Chopra's own account: people "usually come to us when they are slightly troubled".

Switching costs and tenure. 7 of the top 10 customers have stayed more than 10 years. Gross revenue retention, the share of last year's revenue that stayed, was 94.9% in FY26; net revenue retention, what existing customers spend against the year before, 99.6% in FY26, so the old customers are, as a group, spending slightly less. Both cover DaaS and Distribution only; the ad business, where a hotel can stop any month, has no figure. Singapore Airlines, a customer since January 2018, renewed for another long-term contract in November 2025, which the headline put at 4 years.

Bad debts. The allowance for doubtful receivables was ₹9.2 crore in FY26, 0.5% of revenue; ₹27.2 crore of receivables were credit impaired at 31 March 2026. The BRSR reports no consumer complaints on data privacy, advertising or cyber security.

Contracts. No government tenders; private contracts, mostly yearly, some longer.

• Scope and duration. Subscriptions are yearly. In August 2026 management said it had renewed a leading global OTA for a multi-year term. A legacy DHISCO contract had to be renegotiated in FY25 (Pricing power).
• Wins and losses. New contract wins were ₹322 crore in FY26, excluding Sojern and ₹141 crore in the June 2026 quarter, combined. A Sundaram Mutual Fund analyst put the quarterly run rate at hovering around ₹96 to 98 crore; Bhanu Chopra agreed the figure under-represents the business, as it leaves out existing customers spending more. The pipeline was ₹664 crore.
• Losses on record. A large OTA, probably RateGain's biggest source of booking volumes, was being shut down by its parent group in 2025. Myhotelshop lost a big customer when that customer's industry consolidated.
• Bans. None on the record.

Costs and inputs

₹39 of every ₹100 is payroll. Another ₹20 buys media.

RateGain's FY26 consolidated P&L, every line as a share of revenue. Media service cost is the advertising Sojern and Adara buy on behalf of clients, and it more than doubled in the year.

RateGain FY26 annual report and Q4 FY26 presentation · FY26

Of every ₹100 of FY26 revenue:

• ₹39.0 paid staff, up from ₹37.0, with the Sojern staff added (Operations and capacity); inside this sit ₹9.3 crore of Sojern staff earn-out and ₹11.6 crore of their stock rights and ₹3.3 crore of ESOP cost.
• ₹20.0 bought ads for clients.
• ₹6.9 ran the servers and ₹4.7 paid demand partners.
• ₹10.9 went on everything else: legal and professional ₹27.1 crore, travel ₹25.6 crore, advertising ₹22.7 crore, contract manpower.
• That leaves ₹18.5 of EBITDA, operating profit before interest, tax and depreciation.
• Then ₹4.4 of depreciation and amortisation, ₹1.7 of interest, ₹1.9 of one-offs, plus ₹3.4 of other income, ₹3.2 of tax, and ₹10.7 of profit.

The inputs. People, servers, data and, since Sojern, advertising space. Ads bought for clients cost ₹364.6 crore in FY26, more than double the ₹163.3 crore of FY25; hosting and proxy servers, through which the price-collection business scrapes travel sites, ₹126.0 crore; demand partner fees to the OTAs and GDSs on the other side of the switch, ₹85.6 crore; software licences, ₹29.1 crore. The data partners that feed the intent map (Competitive advantage) get a revenue share or free analytics; no cost line is disclosed.

The suppliers. Google, Meta, the metasearch sites and ad exchanges sell the ads; the filings neither name them nor say how much goes to each, so the dependence that matters, on Google and Meta, is not quantified. The BRSR, which covers only the Indian parent, says 62.31% of inputs by value came from small and medium suppliers in FY26, up from 21.40%. Almost every input is bought abroad in dollars, euros or pounds, against revenue in the same currencies; the parent's own exposure is small (Balance sheet).

Fixed against variable. Staff and servers are fixed in the short run. Ads bought for clients and demand partner fees move with revenue, as do the ads Sojern pays for itself, since it is paid back only when a guest stays. Contract labour is small: ₹22.4 crore, 1.2% of revenue.

Operating leverage. Before Sojern it worked: EBITDA margin rose from 15.0% in FY23 to 21.6% in FY25 as revenue nearly doubled. Sojern reset it to the FY26 figure above, because an ad business carries the cost of the ads.

Interest and tax. Interest took 12.3% of operating profit after depreciation in FY26, against 0.6% the year before. Tax took 22.9% of profit before tax, below the Indian rate (Margins and quality of earnings).

Pricing power

Little in DaaS, some in ads.

Realisation against input costs. No price per unit is published for any product. The one gross margin figure, RateGain's own, has fallen since the IPO (Margins and quality of earnings), because ads cost more to deliver than software.

Discounting in the last downturn. In the March 2025 quarter DaaS revenue fell almost 9%, which Tanmaya Das, the CFO at the time, put down to pricing pressure that forced it to reprice some contracts. The DHISCO contract, priced in RateGain's favour since 2018, had to be renegotiated.

Who sets the price. For ads, the hotel compares Sojern's commission after the stay with an OTA's on each booking (How the business works), which caps what Sojern can charge. For tourism boards the deal changed the arithmetic: Sojern and Adara were number 1 and number 2 in destination marketing, had gone head to head, and by August 2026 RateGain needed to discount much less and could hold its price. Bhanu Chopra: "when you take out competition that helps as well." Price caps: none (Regulation and policy).

Pass-through. On a managed campaign the client's budget passes through RateGain, which keeps a fee, so dearer ads are the client's problem; on Sojern's commission model Sojern pays for the ads, so dearer ads come out of its margin.

Strong and weak quarters. Before Sojern the quarters were flat: the first 2 of FY26 were ₹272.9 crore and ₹295.1 crore. Ad spending is seasonal, skewed to the second half of the year: Sojern's first full quarter, to March 2026, brought ₹715.6 crore, and the June 2026 quarter more, with a FIFA World Cup one-off (Operating metrics and the last 8 quarters). The seasonal shape needs 4 quarters with Sojern to show.

The cycle. Travel. Revenue fell by more than a third in FY21, when Covid stopped travel, with losses in FY20 and FY21 (Revenue and profit, year by year), and passed its FY20 level only in FY23. It can turn fast: after the conflict in the Middle East, revenue from the region fell from about USD 970,000 a month to USD 425,000, though the region is only about 4% of revenue. US travel is "holding steady", in management's words, with more domestic than international trips. Ad budgets are set each season and cut first in a downturn, and they are now 4 fifths of revenue.

Operations and capacity

No plant: RateGain runs from Noida and its offices abroad (What the company does) with 1,255 staff at 31 March 2026, up from 821 a year earlier, of whom the Indian parent has 713 permanent staff, 23% women. Its capacity is servers and people; it spends almost nothing on equipment (Working capital and cash flow). The platform claims "99.97% System uptime" and a volume the annual report contradicts (Operating metrics and the last 8 quarters). Expansion is in people: the sales team for Asia and the Middle East grew from 15 to 55 in 2025 and to about 85 by May 2026. Capital commitments: none (Balance sheet). Certificates: none named in the annual report.

Where the revenue, the assets and the staff are. By customer location, FY26 revenue was ₹1,072.5 crore from the United States, 58.8%, ₹454.4 crore from Europe, 24.9%, ₹265.5 crore from Asia, the Middle East and Africa, 14.6% and ₹20.3 crore from India, 1.1%; in the June 2026 quarter North America was 66.2%. Of non-current assets, ₹2,302.3 crore sit in the United States and ₹17.3 crore in India: the goodwill and the bought businesses are American. Staff by region is not disclosed beyond the parent's; Sojern had 366 staff, mostly in the US, at the deal.