Travel agencies in India are riding the crest of a business boom. The bigger agencies like Cox & Kings India, Kuoni and Thomas Cook report that their business has grown by over 40-50 per cent in the last year.

In 2003-2004, the Mumbai-based Raj Travels, for example, reported a turnover of Rs 230 crore (Rs 2.3 billion). This year, its turnover topped Rs 300 crore (Rs 3 billion) by the end of October.

At Thomas Cook, which also offers foreign exchange and insurance services, revenue surged by 27 per cent to Rs 34.8 crore (Rs 348 million) during the May-July quarter (the company's financial year is November to October) versus the same quarter in the previous financial year.

But this does not fully reflect the booming travel business: revenue from the holiday travel business shot up by 70 per cent in the quarter when compared with the same quarter in the previous year.

That is the case too at Raj Travels; the number of leisure tourists it handled so far in calendar 2004 is 161 per cent more than the number in 2003. Cox & Kings expects its outbound business this winter to soar by over 100 per cent.

Indeed, some agencies are furiously expanding nationwide. "We are almost opening one centre every month," says Lalith Sheth, chairman and managing director of Raj Travels.

Little wonder then that international travel agencies are cocking an eye at India. Thomson Holidays, a division of TUI UK, which is among the largest tourism and services group in the world, is exploring the option of setting up shop in India, according to industry sources. Carlson Wagonlit Travels is already here.

Travel agency heads ascribe the boom to several factors. Says Peter Kerkar, global CEO of Cox & Kings: "In the last few years the industry had been severely affected by SARS and the Gulf War.

"After SARS we were sure of an overall boom. We expect this growth to increase further."

Sheth believes that disposable incomes are up, thanks to share prices on the stock market. "We believe that the stock market boom has largely contributed to the overall increase in our business," he says.

The other reasons are reduced airfares, travel agencies' tie-ups with hotels -- which in turn has led to lower room tariffs -- value-added and cheaper packages.