Internet company Info Edge has reported operational revenues of Rs 281 crore in the quarter ended December 31, 2018, which is an increase of 23.7% YoY from Rs 227 crore in Q3FY18. Revenues have also increased 5.8% over the preceding quarter. The company recorded net profits of Rs 74.3 crore this quarter, 39% higher than the profits of Rs 53.3 crore in the same quarter last year.

  • Billings were Rs 272 crores, up 19% year-on-year
  • Revenue was Rs 281 crores, up 24% year-on-year
  • Operating expenses, excluding depreciation for the quarter, were at Rs 197.7 crores, up 33% year-on-year
  • Operating EBITDA stood at Rs 83.3 crores versus Rs 78.8 crores last year, an increase of 6% year-on-year
  • Operating EBTIDA margin for the quarter stood at 30% versus 35% in Q3 of last year
  • EBITDA adjusted for ESOP non-cash charges stood at Rs 87.8 crores versus Rs 82.1 crores last year
  • Adjusted EBITDA margin for the quarter stood at 31.2%, cash EBITDA for the quarter stood at 78.8 crores, down 5% year-on-year
  • Deferred sales revenue stood at Rs 405 crores as of 31st of December 2018, versus Rs 333 crores as of 31st of December 2017, a growth of 21.5%
  • Cash balance stands at Rs 1,868 crores as of 31st December 2018 versus Rs 1,878 crores as of September 30th 2018.

In a call with investors, the company’s vice-chairman Sanjeev Bikhchandani, MD and CEO Hitesh Oberoi and CFO Chintan Thakkar addressed questions from analysts. Their responses have been arranged domain wise.

General notes:

  • Recruitment and real estate continue to drive Info Edge’s Q3 growth. It has invested in marketing, hiring and “upgrading of product and tech talent” in the company Oberoi said.
  • “We spend a lot more than last year on marketing in both Jeevansathi and 99acres. These spends has held us to increase awareness levels of our brands,” Oberoi said.

He added, “We upped our ad spend in all our big three businesses Naukri, 99acres, and Jeevansathi. Jeevansathi we spend a lot more on advertising than last year and there is lot of competitive activity in that space.. so we were forced to respond in 99acres. We have seen a lot more advertising intensity from competition, so we keep our spends also high relatively high.”

  • Info Edge has cut down advertising over the years, and Oberoi says that now is the time to spend a little more on building Naukri’s brand and advertising. “So in all three big businesses we saw between 50-100% jump in ad spending,” he added.
  • On Meritnation, Sanjeev Bikhchandani said that while the company had been through a difficult time, ‘it is now bouncing back nicely, and going well. It is still burning money but the peak season just started Jan-Mar, let see how this peak season goes but we are hopeful.’

Naukri.com, Recruitment

  • Naukri’s incremental spends were on technology upgradation, new product development and marketing and data science.
  • Naukri added an average of 12,000 new CVs every day, its database has now grown to over 61 million CVs
  • Traffic in traditional job portal space (unspecified) continues to remain high in the mid-70s
  • The company will invest aggressively in recruitment tools and systems, has strengthened its customer support and data sciences team
  • IT sector and recruitment consultants driving growth

Oberoi believes that the company has 25-40% share of the hiring market. He added that while some companies hired 5-10% of its people through Naukri, for others it was as high as 40%, both of which were primarily in the white-collar private sector lateral hiring.

  • The billing this year was up 20% for the first 9 months, much stronger growth than the last two or three years
  • It will invest in hiring its senior team, management, product and technology and new areas of data science
  • High top line growth has led to Naukri’s margin expansion.

99Acres.com, Real Estate

  • Traffic share amongst the real estate portals continued to be around 50% mark based on time spent.
  • The broker segment continues to see strong growth.
  • ‘Investment in 99acres will continue as the real estate market stabilizes, the key focus of investments in 99acres will be more marketing spends for brand awareness and its tech product and data quality.’
  • On 99Acres, and the regulatory environment, Oberoi said, “Last year we had a terrible first half because of RERA and in first half this year, we saw close to 45-50% growth on top of a very low base last year. Things started recovering in Q3 of last year, so this year again we grew billings by 30%… But we are seeing two things in real estate: one, in general, real estate activity seems to have stabilized and in fact transactions actually have gone up in some markets, so people are buying more homes as they were buying earlier, but we are also seeing a slowdown in new launch activity.”

In real estate 99Acres was impacted severely because of demonetisation, RERA, GST, etc. “The NBFC crises may have impacted lending or financing to builders and also some home loans and… decline in new launch activity.”

  • In the residential real estate market, the company is looking at a market of Rs 3,000 – 3,500 crore out of the total advertising peak spend of Rs 5,000 – 6000 crores.
  • “… We want to continue to invest and do whatever it takes to maintain and grow our share in these Communities (North and Maharashtra).”
  • About 45% of the site’s revenues comes from builders

Jeevansathi.com, Matrimonial

  • Billings in Jeevansathi grew 5% year-on-year in Q3 to Rs 17.6 crores owing to a “continued aggressive pricing and activity by competition.”
  • Price war in the North and West, and while the company did well for the last 2-2.5 years, the last 2-3 quarters have been slow.
  • Bikhchandani said, “Our revenue growth hopefully will sort of slowly start bouncing back if we execute well but very difficult to say how the market is going to pan out. There are two other players who are much bigger than us and they are also spending a lot of money.”

Zomato.com, Advertising and food tech

  • Continues to witness massive topline growth in the delivery space, announced an investment of Rs 13.4 crores in Shop-Kirana B2B grocery delivery platform during the quarter.
  • Follow up round of investment of Rs 28 crores in its investee company No Paper Forms and Rs 3 crores in Shoe Connect in the quarter and it continues to evaluate new investment opportunities.

Sanjeev Bikhchandani: “Zomato its going head to head with Swiggy, Uber Eats is also in the fray as is Food Panda. And it has become a hugely capital consumptive game, so yes Zomato is looking to raise money and interest from several investors but right now it is a work in progress.”

PolicyBazaar, PaisaBazaar, Insurance

  • Sanjeev Bikhchandani said that PolicyBazaar is well placed for funds, and is a dominant market leader in insurance comparison.
  • Both PolicyBazaar and PaisaBazaar “want to use their data to… develop smarter and better insurance products… So, they will go deeper and deeper into the insurance space but evolving, innovative and launching new offerings,” he added.

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