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Corporate Jul 18, 2013

IRCTC signs deal with Yebhi.com, to offer clothes, shoes and furniture soon

By Avanish Tiwary

Indian Railway Catering and Tourism Corporation (IRCTC), a subsidiary of the Indian Railways, has made a move towards becoming a major online retailer by forging a partnership with Yebhi.com.

Under the one-year deal announced today, Shop Online Trading Pvt Ltd (SOTPL), a subsidiary of Yebhi.com, will manage everything from running the new e-commerce platform to logistics, pricing, offers, delivery of goods, payment gateway among other things for IRCTC, which gets close to 1.2 million daily visits.

The new e-commerce platform will sell everything that is there in Yebhi's catalog including apparel, shoes, furniture, home decor, etc. To be sure, IRCTC's partnership with Yebhi is only for a year.

"Our thinking is that it will give us the access to the rest of India, which no e-commerce company, except IRCTC has been able to target. It is the largest e-commerce property, which has access to rural India and they want to generate more revenue by adding retail to their bouquet," Manmohan Agarwal, CEO at Big Shoe Bazaar India (which owns Yebhi), told Entrepreneur.

Screengrab of the IRCTC website.

Screengrab of the IRCTC website.

IRCTC had earlier shown interest in other categories like air ticket and hotel bookings besides its flagship business of selling train tickets. The process for partnering with an e-commerce portal had started in February with the floating of a tender by IRCTC.

The front-end of the new e-commerce platform will be handled by IRCTC, whereas all the back-end work will be handled by Yebhi. The new portal will be available on the IRCTC website under a new tab and will probably be called "IRCTC Shopping."

"The reason for us to get into this partnership with IRCTC is that it gives us an audience that is beyond urban India and what I call the real India, which are the Tier IV and V cities," Nikhil Rungta, Chief Business Officer, Yebhi told Entrepreneur.

According to Rungta, this deal has the potential of generating revenue of more than Rs200 crore for Yebhi. IRCTC's new e-commerce platform will go live by August and Yebhi might also hire new people for the venture, Agarwal said.

Avanish Tiwary works for Entrepreneur magazine

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