Q1 19/20

Aug 13, 2019

Ladies and gentlemen, good day and welcome to the Info Edge Limited Q1 FY 2019-20 results conference call. Joining us on the call today are Mr. Hitesh Oberoi, Managing Director and CEO, Mr. Chintan Thakkar, CFO, and Mr. Sanjeev Bikhchandani, Vice Chairman. As a reminder, all participant lines will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star and zero on your touchtone phone. I now hand the conference over to Mr. Hitesh Oberoi. Thank you, and over to you, sir. Thank you. Good evening, everyone, and welcome to our FY 2019-20 first quarter results conference call. We will first take you through the quarterly financial performance of the company. Here, I would like to mention about the implementation of Ind AS 116 from the current financial year. As you must be aware, effective April 1st, 2019, there is a change in accounting for lease as mandated by Ind AS 116. Accordingly, we have recognized the right to use assets and lease liability. We have also charged depreciation and interest on the same instead of expensing the rentals. Consequently, EBITDA is higher but PAT is lower, as we have mentioned in the publication. As we've opted for modified retrospective approach as per Ind AS, comparatives for previous quarters are not separately available in our published results. To enable comparison, we would be announcing EBITDA for each segment with carved-out impact of Ind AS. We will, of course, after that, cover each business in more detail, and in the end, we'll be happy to take questions. The audited financial statements file has been uploaded on our website, infoedge.in. We have also provided segmental billing revenue profit before taxes and DSR movement in our data sheet on our website. Let's start with the standalone financials. Billings in Q1 were INR 336.3 crores, up 18.7% year-on-year. Revenue in Q1 was INR 312.8 crores, up 20.5% year-on-year. Operating expenses, excluding depreciation for the quarter, were INR 211.8 crores, up 20.8%. Operating expenses readjusted for Ind AS 116 stood at INR 217.8 crores, up 24.26%. Operating EBITDA stood at INR 101 crores versus INR 84.3 crore last year, an increase of 19.8% year-on-year. Operating EBITDA readjusted for Ind AS 116 stood at INR 94.98 crore, up 12.7% year-on-year. Operating EBITDA margins for the quarter stood at 32.3%. Operating EBITDA readjusted for Ind AS 116 stood at 30.37%, down from 32.5% last year. EBITDA readjusted for ESOP non-cash charges and Ind AS 116 stood at INR 100.2 crore versus INR 88.1 crore in Q1 of last financial year. EBITDA margin readjusted for ESOP and Ind AS 116 for the quarter stood at 32%. Cash EBITDA for the quarter stood at INR 123.5 crore, up 10.3% year-on-year. Deferred sales revenue stood at INR 495.3 crore as of June 30th, 2019, versus INR 419.8 crore as of June 30th, 2018, a growth of 18% year-on-year. The cash balance in IEL and all its subsidiaries, 100% of its subsidiaries, stands at INR 1,543 crore as of June 30th, 2019. This was at INR 1,980 crore as of June 30th, 2018. The recruitment business and the real estate business, of course. Before I move on to the businesses, I'll let you also cover the consolidated financial highlights. At the consolidated level, the net sales for the company stood at INR 319.7 crores versus INR 277 crores from corresponding quarter in 2018. For the consolidated entity at the PAT level, there is a loss of INR 192.1 crores versus a loss of INR 22 crores from the corresponding quarter of last year. Adjusted for exceptional items, PAT stood at a loss of INR 189 crores in the quarter ended June 2019 versus a loss of INR 22 crores in the corresponding quarter last year. The recruitment business and the real estate business continued to drive the growth of Info Edge in the last quarter. We increased our spend on marketing substantially in all our businesses, specifically Naukri and Jeevansathi. Our overall spend on marketing for the quarter was around INR 55 crores, up 46% year-on-year. We continue to sort of invest aggressively in product technology, data science and engineering in all our verticals. Both of these investments We've also sort of piloted a couple of new projects, and investment in these areas will continue in subsequent quarters as well. Let's move on to the recruitment business. In Q1, the recruitment segment billing was at INR 251.75 crores, up 19.8% year-on-year, while revenues were at INR 219.5 crores, a growth of 19.2% year-on-year. Operating EBITDA stood at INR 114.9 crores, up 9.9% year-on-year. Margins were at 52.4% versus 56.8% in Q1 of last year. EBITDA readjusted for Ind AS 116 stood at INR 211.8 crores at a margin of 50.9%. EBITDA readjusted for ESOP non-cash charges and Ind AS 116 stood at INR 117.37 crores at 52% versus 57.8% in the same quarter last year. Cash EBITDA for recruitment during the quarter stood at INR 146.5 crores, up 10.6% year-on-year. In Naukri, in Q1, we added an average of 19,000 fresh CVs every day, and the Naukri database grew to over 64 million CVs. Average CV modifications were at 366,000 CV mods per day. Our traffic share in the traditional job board space continues to grow and is now at over 85% without Indeed, and at about 67% including Indeed. We continue to invest in our recruitment tools and systems business as we sort of experience more adoption of our offering in the market. We continue to invest aggressively in data science and AI, and machine learning to improve the user experience of both recruiters and job seekers on our platform. The IT and ITeS segments continue to drive the growth rate growth for Naukri in the last quarter. Southern markets did phenomenally well compared to markets in the west and north. We also invested aggressively in marketing, especially television, brand building, and outdoor campaigns in the last quarter. All our metrics sort of indicate to us that these campaigns were very well received in the market, and the impact on our business has been positive, and our brand has got a boost as a result of these campaigns. As you also know, we also completed the acquisition of iimjobs during the quarter. iimjobs reported a billing of INR 5.7 crores for Q1 of 2020. This is a growth of 22% from Q1 from the same quarter last year. The business operates at a near break-even level. Let's move on to the other verticals. In the real estate business, in 99acres, billings in Q1 grew 18% year-on-year to INR 48.4 crores, while revenue grew 34.6% to INR 56.4 crores. EBITDA for the quarter stood at INR 24 lakhs. EBITDA adjusted for Ind AS 116 stood at a loss of INR 1.62 crores against a loss of INR 11.48 crores in Q1 of last year. EBITDA adjusted for ESOP and Ind AS 116 expenses stood at a loss of INR 97 lakhs versus a loss of INR 10.73 crores last year. A cash EBITDA loss in 99acres during the quarter stood at INR 7.13 crores against a loss of INR 11.73 crores last year. Our traffic share amongst the real estate portals continues to be around 50% based on time spent as per Similarweb. The broker segment continues to see strong growth, with almost 20,000 brokers now active on the platform. Like we've indicated in the past, the key focus and invest areas for 99acres will continue to be sort of marketing and brand building and investment in product and technology, and data quality to improve the quality of experience for our users on our platform. Moving on to the Jeevansathi business. Billings in Jeevansathi grew 10.3% year-on-year in Q1 to INR 20.11 crore, and revenue grew 9.4% year-on-year to INR 19.92 crores. The operating EBITDA loss in Jeevansathi stood at INR 8.83 crores in Q1 of FY 2020, up from a loss of INR 5.6 crores last year. EBITDA adjusted for Ind AS 116 stood at a loss of INR 9.49 crore. EBITDA readjusted for ESOP and Ind AS 116 stood at a loss of INR 9.3 crore for Q1, versus a loss of INR 5.46 crore last year. Cash loss for Jeevan Saathi during the quarter stood at INR 9.13 crore. Higher marketing spends on Jeevan Saathi during the quarter led to an increase in traffic as well as the number of paid users or free users registering on the platform. We continue to see positive sort of benefits of increased marketing spend, which leads to higher traffic growth on the platform as we move into the second quarter of FY 2019-20. In the Shiksha business, in the education business, in Shiksha, in Q1, billings grew by 13.9% year-on-year to INR 16 crore, while revenue grew 10.7% year-on-year to INR 16.93 crore. In the Shiksha business, we made an EBITDA profit of INR 4.26 crores in Q1. EBITDA adjusted for Ind AS 116 stood at INR 3.73 crores versus an EBITDA of INR 3.06 crores last year. EBITDA adjusted for ESOP and Ind AS 116 for the quarter stood at INR 3.95 crores versus an EBITDA of INR 3.32 crores last year. Cash EBITDA profit for the quarter stood at INR 3.09 crores versus a cash EBITDA profit of INR 2.1 crores last year. We sort of continue to put in a lot of effort to upgrade the quality of content on the Shiksha platform. Moving on to our strategic investments. Zomato continues to witness very strong overall growth across all their businesses, including the food delivery business. They are now operating in many tier 3 towns as well. Their focus is not only to grow but grow efficiently and hence they are able to, so that they can reduce the burn over time. Policybazaar and Paisabazaar both continue to maintain a healthy growth rate. The revenue growth in the last two financial years has been more than 60%, and we also continue to evaluate new investment opportunities. That's all from me right now, and thank you, and we are now ready to take any questions. Thank you very much. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on your touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. To ask a question, please press star one now. We have our first question from the line of Jay Nandwani from Perfect Research France. Please go ahead. Hello. Yes, please go ahead. Yeah. Good evening, sir. Yeah, good evening. I have a few questions. I would ask it in a single order. What competition do you foresee from players like Indeed, Google Jobs and Monster, which was recently acquired by Quess Corp? Like our global peers, are we planning to conduct screening tests to check aptitude, psychometric tests, so as to better filter out candidates as a major help to employers? Can you throw more light on recent investments in ShoeKonnect, Gramophone and iimjobs? Global players like seek.com, Recruit and 51job are growing at more than 15% revenue growth. With such a large base, can we also grow at the same numbers? Okay. As far as competition from the likes of Indeed, Google Jobs, and Monster goes, Indeed has of course, been very active in India for the last few years. It's been maybe more than five, seven years now. For a while, in between, they were very strongly spending a lot of money on marketing and advertising as well. They were very active on the performance marketing side, too. We haven't really encountered them much on the customer side. They've been very aggressively trying to attract more job seekers to their platform. That continues to be the case with Indeed. They've sort of been a little out of media for the last three or four months, but they could come back anytime. Yes. As Google for Jobs is concerned, Google for Jobs is not really trying to monetize a platform right now. I think their goal seems to be to improve the experience for job seekers who search on Google for jobs. We have not been giving them our jobs till now, but we will continue to revisit our position from time to time. Monster.com, we haven't seen any activity from Monster.com in the market for the last few years now. Yes, they've been acquired by Quess Corp. I think on traffic and on many other parameters, they still have a long way to go. Our traffic share in the job portal space if you look at our traditional competitors like Shine.com, Monster.com, TimesJobs, was actually higher than 85% or maybe also 88% in some months last quarter. As far as screening tests and psychometric tests go, what tends to happen is that companies use platforms like ours for shortlisting candidates and only on the shortlisted candidates do they run psychometric and screening tests. As a part of our effort to sort of build recruitment tools and solutions for our clients, we may over time integrate with some assessment companies. We already allow companies, when they post jobs on Naukri, to ask a few questions, which can help them filter the right candidates while posting a job itself on naukri.com, so that continues. We don't really have a big effort right now in Naukri to provide screening and psychometric sort of services to our clients. In the first Naukri business, it's a very small part of what we do. We have a tie-up with an assessment company, and we provide these services to companies who want to hire job seekers from campus, but not in the main Naukri business at the moment. As far as you mentioned, 15% revenue growth, I mean, the Naukri business for the last few quarters has been growing at more than 20%. Of course, we are working on a lot of interesting new ideas. If some of those work out, then of course, things could change. Also, a lot depends on the economy. If growth rate picks up in the economy, then the growth rate in Naukri could pick up. iimjobs we acquired very recently for a consideration of around INR 80 crore. Company's got a very strong brand and a very good product in the space in which it operates, which is right now a niche space. We think using our Naukri sales and distribution muscle, we will be able to take not just iimjobs but also some of their other offerings, which are slowly becoming popular, like Hirist.com and a bunch of others to a lot of customers because we work with close to 75,000 customers, as you know, while they currently have maybe just 700-800 customers. Yeah. What was the question? I couldn't make out the question. ShoeKonnect, Gramophone. Could you repeat the question on ShoeKonnect and Gramophone? Hello? I just wanted to know a little bit about the investment. Yeah, linkages among the three of you. Well, actually, there's no linkage among the three of them. They are independent investments. ShoeKonnect essentially is a B2B kind of player, which connects shoe manufacturers to shoe retailers, the underserviced retailer, and the small manufacturer. It's a fragmented industry, and it does logistics and ordering. It's showing good traction, and it's getting inbound interest from other investors. Gramophone has already raised a round from an external investor after we went in. Gramophone is working in parts of Madhya Pradesh with farmers on advisory and selling them inputs. What's going on? There's something wrong with the connections. Hi, sir. Yeah. Can we have the next question, please? Yes. Yeah. Thank you, sir. We have the next question from the line of Manish Adukia from Goldman Sachs. Please go ahead. Hi, good evening, and thank you for taking my questions. A couple of questions. You mentioned that Indeed has been a bit absent from the media in the recent months in terms of advertising and marketing, while your spend has gone up in the recent quarters. You also indicated in your opening remarks that you've seen some positive trends coming out of that. If you can just throw some light on how has this increased advertisement spend helped you in terms of ramping up your customer base or your revenue. That's one. A couple of quick questions on the real estate. Again, if you can just provide a quick update on what the competitive scenario there is like at this point, and what the underlying real estate market at this point in time looks like. There's been some weakness in the underlying real estate market, but what's your sense? How does it look like over the next three, six, nine months in terms of the underlying market? Thank you. Indeed has been around for a long time now, and they've been advertising aggressively for the last few quarters. They were out of media for the last two or three months. When I say media, I mean media like television and outdoors. They've been aggressive on the performance marketing side. They continued aggressively to advertise online. We have been doing a little bit of advertising, but not that much for a long time now. We were out of media. We made a new ad film and went back on TV a few months back, and the results have been very encouraging. See, the advertising we do is more directed at consumers than job seekers, and it's unlikely to impact our corporate revenue in the short run. In the long run, if our brand moves to the next level and we are able to attract more job seekers to the platform and more people to come download our apps and become more active, then over time, it will translate into increased revenue from our customers as well. That's the idea behind these marketing campaigns. As far as the real estate business is concerned, the real estate market continues to be in very bad shape. In fact, in our business also, while billing growth has actually slowed down this quarter, while we grew at 18%, billing at 18%, different markets behave differently. In some markets, we grew at 25%, 27%, and in some markets, we grew in single digits. I guess the impact has been different in different cities. Definitely, what we are hearing from our customers is that there is a problem with financing both for builders and for buyers of new homes. As a result, new launches are likely to be hit. Not enough builders will probably launch new projects now, and that impacts our business. Having said so, it's still a market where we are a tiny part of the market. The real estate market has been through hell for the last five years. We had RERA, demonetization, GST, all kinds of issues, but we've been growing every year. In fact, in this quarter, we sort of broke even in this business. If the market continues to grow even moderately, we should be fine. We should be, at some point in time, able to pick up our growth rate. Yes, if there is a big crash in the market, then who knows? As far as competitive position is concerned, like I mentioned, we continue to have close to a 50% traffic share in the market as per Similarweb. In some cities, we believe we are fairly strong, and we have close to 60% share. In some other markets, we have close to 40% share. On the whole, we believe we have a 45%-50% share of the market at this point in time. Shashank, just a quick follow-up on the matrimony business. Again, in that business, ad spends have been quite high. How is the competitive scenario there in that space? What are we seeing? That space is very competitive. It's a 3-player market. In the north and west, where we are a strong player, it's a 2-player market, mostly between us and Shaadi.com. What has happened really in the last 3 or 4 years is that we've managed to create a place for ourselves in this market. From virtual nobody, we are now a business which is doing about INR 20 crores a quarter in terms of collection. Of course, there's an aggressive price war in this market at this point in time. All the 3 companies are spending a lot of money on advertising also. Therefore cost of customer acquisition is going up. That's why our losses have gone up. We believe it's the right strategy for us at this point in time. If we continue with this strategy for the next couple of years, we will be able to become a strong player in one part of the market. Great. Thanks so much. Thanks for taking my questions and all the best. Awesome. Thank you, sir. We have the next question from the line of Vivekanand Subramanian from Ambit Capital. Please go ahead. Yeah. Hi. Thanks for the opportunity. Yes. This customer addition trend that we are seeing in Naukri.com. Can you throw some more light on this? What's going right for you there? Can you give a bit more color on the recruitment market growth that you have seen? My second question pertains to your investments. Over the last year or so, you've been making a lot more B2B investments. Can you give some color on the valuations in the B2B space compared to the B2C space, and how do you see it in the context of the addressable opportunity in B2B markets versus B2C? Thank you. Yeah. The recruitment market as a whole, it's very sectoral. Some sectors continue to do well, like I mentioned, IT. Our IT business grew at more than 20%, in fact, last quarter. IT companies, especially the companies based out of Bangalore and Chennai and Hyderabad, seem to be doing well, and they seem to be hiring large numbers. That's a positive for us. Sectors like healthcare, education, services in general, except for now, NBFCs and telecom services, which have been hit, and where hiring has been hit to some extent, continue to do well. The infra sector or sectors like construction, real estate, high-end heavy metals, engineering, they continue to be sort of in trouble. Our revenue share, for example, from the so-called or what we call the infra sectors, has over a period of the last 10 years, declined from a high of 25% to maybe now 15, 16%. Right? These sectors continue to be in trouble from a hiring standpoint. Yeah, and in general, sort of the SME space for us continues to do well. We've been able to get more SMEs to sort of list on naukri.com, which is where a lot of the new customer sort of growth comes from. All in all, you see in a good economy, what tends to happen is that companies have high attrition and therefore they hire more people to even stay at the same number. They're more aggressive and bullish on the future, and therefore, they hire more people also. Their headcount also tends to go up. Many new companies set up shop because they see more opportunity. In a slow market, the exact opposite happens. Some sectors have been slow, some sectors are okay. Overall, things seem to be under control right now. Of course, a lot will depend on what happens going forward. Auto sector was another sector which is now in trouble when it comes to hiring. They're not hiring. All this is also very well captured in our Naukri.com JobSpeak Index, which we release every month. For July, I think the Naukri.com JobSpeak Index was up 14%, while the IT index within the Naukri.com JobSpeak Index was up more than 25%. Sectors like banking and auto were negative in the Naukri.com JobSpeak Index. That should give you a very good sense of what's happening in the market. Yeah. On the B2B space, look, we evaluate opportunities, and we've invested in two B2B companies among the last five companies we invested in that we announced. One is a company called ShoeKonnect, which we discussed a little while back. The other is a company called ShopKirana, which essentially is in last-mile distribution of FMCG products to the small retailer. It's operating right now out of Indore and Jaipur and Bhopal, and they're doing a fairly good job. Good news about both these companies is that they've got a lot of inbound investor interest and from other investors, so it looks like they have legs. As far as valuations are concerned, right now in private markets, the phenomenon we're seeing is that, look, if a company is showing traction, it is getting chased by a number of investors, and whether it's B2B or B2C, valuations get better. Of course, B2C will be higher. B2C will be higher, but B2B also is not cheap. Okay. Just a couple of follow-ups. Hitesh, you mentioned that in a good economic scenario, you have a lot more companies set up and a lot more attrition. Notwithstanding the GDP slowdown, how is it that we've managed to kind of sustain the billing growth and revenue growth? Compared to, say, previous occasions when GDP growth used to slow down, our billing growth also would taper down. What is it that is working for us this time compared to prior occasions? Broadly what you're saying is right. GDP growth does impact our billing growth. There are two, three things I want to say. One is, of course, IT. I don't know whether IT hiring is more indexed to India's GDP growth, or maybe it's more indexed to how the U.S. is doing and how the rest of the world is sort of looking at. That is one. Two, even within India, there is a slowdown in certain sectors for sure, like I mentioned in NBFC, the NBFC sector, the auto sector, telecom. These sectors seem to have been impacted. There are other sectors which continue to do well. There's no slowdown in those sectors as far as we are concerned. Sectors like travel, tourism, hospitality, education, healthcare. Some of these Jobs from these kind of companies continue to grow on our platform. One doesn't really know. I'm not the best person to comment on this, but it doesn't seem like it's a slowdown like we saw in 2008 or 2009 when the entire economy sort of hiring came to a standstill. Enough companies are still hiring. Yeah, certain sectors seem to be slow. Thank you. All the best. Thank you, sir. We have a next question from the line of Arya Sen from Jefferies. Please go ahead. Yeah. Hi, good evening. Firstly, if you could repeat the Jeevansathi revenue, I missed that. Jeevansathi, just one second. Billings grew 10% to INR 20.11 crores, and revenue grew 9.4% to INR 19.92 crores. 19.92 crores, right? Okay. Yeah. Secondly, the Naukri.com margin seems to have come off a bit more than usual this quarter. You talked about brand campaign and ad spend. How do we look at it going forward? Was there a bit of a one-off in this quarter and could it improve going ahead, or does that continue for the rest of the year? There are 2 or 3 types of investments we're making in the recruitment business. One is, of course, this quarter, as in Q1, we spent a lot of money on marketing. We are spending right now also, as we speak, we are on TV. This is going to be at least a two-quarter thing. We'll see what to do in Q3 and Q4. We haven't made up our mind as yet, as far as marketing expenditure goes. The other investments which are taking place are in one, we are beefing up our product and technology and data science and design capability. We've hired a lot of good people in that area, and we're working on a bunch of things, the impact of which will not be seen tomorrow, but maybe over a period of time. These investments will continue, and these investments will probably increase with time. The third thing, we have also now sort of doing a couple of new experiments. We've set up teams to look at the blue-collar space. We've set up a team to look at how we could disrupt the premium hiring market using AI and machine learning. There is some investment which is going to go into these teams. These teams won't be generating revenue for quite some time, in fact. This is something which we are not capitalizing on these investments. We are charging them to our P&L. These investments will only also increase over time. Yeah. Right. Lastly, in your consolidated, the share of net losses of JVs, that seems to be highest. That is mainly Zomato and Policybazaar, right? Yeah, I think the main contributor would be these two companies. You're right. How much would be Zomato within that, and what's happening there in terms of the cash burn? Burn, they're bringing it down. I think they have a plan to bring it down substantially, and they've begun to act on it over the last three, four months, and it's already showing results. They've not announced any numbers just yet, but they're progressing on that path. Right. Just to sort of clarify the contribution to loss this quarter seems to be INR 253 crores versus INR 310 crores for the whole of last year. There is no accounting thing in that, right? That is the loss. 334? Last year, Zomato had sold one of its outstation business. They did a transaction in the Middle East with Delivery Hero, and so that gave it a revenue boost. Last year. Yeah. last year was one of the one-off. This year it is normal. Last year there was a one-off, so adjusted for that, the loss would have been higher for the full year. Correct. That's correct. Okay. How much would that number have been? Number for the sale that they did? The INR 310 crores for the full year, if I sort of adjust for that sale of the Middle Eastern business, that's what you're referring to, right? I don't know. How much would it have been? Right now I don't know the exact numbers. We'll get back to you. Yeah. It was announced, so it'll be there in the annual results. It will be there in our annual results. That's fine. I'll look it up. Thank you. That's all from my side. Thank you so much. Thank you, sir. We have next question from the line of Shaleen Kumar from UBS Securities. Please go ahead. Yeah. Hi. Thanks for the opportunities. I have two questions, one related to Naukri.com and another related to 99acres. In Naukri.com, we could see that your marketing spend has gone up sharply. Just want to know how has your spend gone up on Google ad spend or adverts, and what percentage of traffic come to you from Google? We don't really share this kind of data. We advertise on multiple platforms. Google is, of course, one of them. Hitesh, the thing is, the reason I'm asking, see, earlier when somebody used to search jobs, let's say a software job in Bangalore, you will get some links, maybe yours, maybe Shine.com jobs, maybe TimesJobs, right? Right now, what somebody will get is a list of jobs which are provided by Google. That's what I'm understanding. Will the pricing power shift to Google at that point of time? Now Google can ask you if you want your ad to be above mine, you may have to pay premium, right? In that case, your marketing spend is going to go up. That was the case earlier also. If we want, actually, we can give our jobs to Google. They will be happy to take our jobs and feature them in their search. It's just that we are not doing it right now. Earlier also, and this will be Google's model from day one, that if you want to appear on top, you have to advertise, right? Otherwise, you could make it to any link on top. It doesn't necessarily have to be your link. Yeah. The only point is that has it increased after this Google Jobs, or is it the same? What has increased? The pricing of the amount which Google is charging. I really don't have the numbers. What you must have to understand is Google is one platform we advertise on. We sort of advertise on Facebook, we advertise on YouTube, we advertise on Google, we advertise on the networks, we do app marketing campaigns, we are on television, everywhere. Google is a very small part of our advertising mix. Okay, fine. Good enough. On the second bit on 99acres, as you have also pointed out, we've been seeing a growth of 30% plus in this segment, and in this quarter, the billing growth was a little lower, around 18%. Yeah while the revenue growth was around 35%. We were coming out of RERA, and there was some kind of a pent-up demand, and there was a market shift, organized player, better place, and probably be able to garner that demand at that point of time. Even 18% growth is very good. Do you think that from a very high growth, we are kind of reaching to a steady growth or robust growth kind of a scenario? It's difficult to say, because like I mentioned earlier in the call, even in this quarter, we saw very robust growth in some markets. In some markets, we hit even 27%, 28%. In some markets, our growth was down to single digits. Yes, our growth has slowed down in the last one or two quarters, but we are not calling it a slowdown as yet. We are still hopeful that, if you sort of do a few things right, we could up our growth rate. Having said so, like real estate, I don't want to sort of comment on, because like I said, in the last three years, we've been through RERA, we've been through demonetization, we've been through GST, and now there's an NBFC crisis, which has hit both builders and buyers. Right? Hard to predict what's going to happen in the market. It's not as if transactions have gone up over last year. Transactions are where they were. It's not as if the number of homes being sold has gone up. The situation is different in different markets. We'll have to wait and see what happens. I mean, hard for me to predict. Yeah, if underlying industry is in trouble, there's only a limit to which you can also grow. Not really. We estimate that the ad market for real estate is at least INR 3,000 crore, if not more. 10 years ago, actually, this market was more like INR 6,000 crore. The market has actually declined, the ad market, over the last 10 years. In this market, we are doing what? We are doing INR 200 crore. It's not as if we are 20% of the market or 30% of the market. In a declining market for the last five years, we've sort of managed to more than double or triple our revenue. Right? We believe that there is still opportunity for us to grow. Of course, we have to execute well. We have to do a lot of things at our end to make that growth happen. Even in a slow market, we can continue to grow for a long time, I think. Right. How has our deferred revenue grew in real estate, and where it stand right now? Let me get the breakout. I think we. The overall deferred revenue, I think, is up 18% over last year. Yeah. Yeah. Do you have the 99acres number? It would be in line with, because billing growth is about 18%, revenue growth was about 34%, right? Revenue growth is kind of coming down because it is coming from the previous quarters. It could be in line with what the current- Billing growth billing growth would be. Maybe, yeah. Yeah. You have to make the adjustments, but roughly you can say that. Okay. Thank you so much. That's it from my side. Thank you, sir. We have next question from the line of Pranav Kshatriya from Edelweiss Capital. Please go ahead. Hi. Thanks for the opportunity. I have only one question. Regarding Jeevansathi, how do you see your incremental market share in your targeted north and the west market? Do you think you're closer to 40%-50% market share there, and what is aspiration in terms of the market share in that market? We are stronger in the north than we are in the west. West is still a three-player market, while the north is more largely now a two-player market. I don't really have an exact sort of sense of our share. Maybe we are in the 30s, not in the 40s, I think, at this point in time. In terms of transactions, we may have slightly higher share because we sort of tend to sell at some sort of lower prices than some of our competitors. Our long-term goal is to sort of keep increasing our volume share, and then, of course, our value share over time. We want to sort of be a player in this market. We are focused on the north and west. Right. In terms of population, the north and west are close to 50%-60% of the country. They sort of have been slower to get onto the internet because PC penetration was, of course, very low in these markets, at least in the north. Thanks to smartphone penetration going up, these sort of geographies are also, or these sort of areas are also getting online. In the long run, we believe that the north plus west will end up being 50%-60% of the market. If we can get to 50% share in these sort of regions over time, then at least we have a play. Okay, thank you. That's it from my side. Thank you. We have a next question from the line of Parag Gupta from Morgan Stanley. Please go ahead. Hi, good evening. Hey, Hitesh. You seem to have seen a significant increase in your recruitment traffic or actually in your market share. I think about 70% in the previous quarter to 85% this quarter. What's really happened out there? We've been advertising aggressively for the last three, four months. That must have had an impact, for sure. Of course, we continue to work on improving our product and improving our experience. That may have had some impact as well. I think it's largely because of our media presence at this point in time. In your view, who probably has been the largest market share donor in the quarter? This 85, 87, 88% is when you take the market to be just TimesJobs plus Monster plus Shine, which are our traditional competitors. Right. My sense is all of them have lost shares in the quarter. I haven't really looked at the individual numbers. What happens in a slowdown, and we've seen that in the past, our competition begins to cut back a lot on investments, right? In a slowdown. Simply, financially, it doesn't make sense for them because they are already probably loss-making. We, on the other hand, as Hitesh has said, we've gone and invested. It's probably been a double whammy for them. Sanjeev, do you think that it's also because you have kind of exposure across segments while some of your other competitors may not be, let's say, in IT sector? Is that also a reason for that, or do you think competitors are also spread across most of the segments? No, I think pretty much everyone does everything. It's not as if they are focused on a few segments only. Got it. Okay. Your acquisition of iimjobs, I don't think that's showing up in your Q1 numbers. Is that something that will only start coming through in Q2? Probably it will come from next year, because right now we are holding it 100%. We may go for a formal merger, and once that is done, then it will become part of standalone. That may not be there. I think Hitesh in his scripted remarks said that the growth in the billing is about 22%, and it's kind of EBITDA breakeven if you don't take certain exceptional costs which are related to acquisition. If you don't take that into account, then it's kind of a breakeven business. Chintan, wouldn't iimjobs start coming in your consolidated numbers from Q2? No, no. It's consolidated in the numbers in that sense, yes. In the standalone, it will not come unless and until there's either a formal merger or a business transfer or anything of any other structure. Okay. In this quarter, your tax rate was pretty high in the standalone. Is that the number going forward, or do you think this will normalize through the year? Should be normalized through the year. I'm not sure if there is some Ind AS impact or maybe its effect on that. Yeah. Okay. Thank you. Thank you, sir. We have a next question from the line of Manish Poddar from Reliance AIF. Please go ahead. Hey. Hi. I just had one question. I wanted to understand the thought process behind this RMS tool for Naukri. What is the opportunity, let's say, for a SaaS tool like this, and what is the thought process behind it? The thought process is very simple. We work with 75,000 companies of all shapes and sizes. Some of them are very small, some of them are very large. The large ones, of course, have access to the best tools out there in the market. Many of them go for international tools. There are some high-end domestic players as well who sort of cater to that market. There are a bunch of companies in the middle, and some of the smaller ones as well, who don't use anything at this point in time, or their tools are very outdated. The idea is to sort of see if we can get some of these companies to use our tools. There are many benefits. One, of course, one gets some incremental revenue. Two, if you get a lot of your clients to do a lot, spend a lot more time on the platform, there is greater locking over time. That's really the thought process. It's still early days and it's a new business for us. We are still trying to figure out the SaaS space. We are not a SaaS company to start with, as you know. Yes, we're making good progress and we'll continue down this path. Just wanted to understand, is this open source right now? Can the employer plug in the other players or it just only Naukri.com? There are different versions. There are versions where you can sort of plug in other players as well. A lot of it is work in process. It's not as if it's all 100% built out. There's still a lot of work going on the offering. Okay, great. Thanks. Thank you. Participant who wishes to ask a question may press star and one on their touch-tone phone. We have a next question from the line of Prince Poddar from JM Financial. Please go ahead. Hi, Hitesh, Sanjeev, Chintan. Just two, three questions from my side. Firstly, a bookkeeping question. Ind AS EBITDA margin comparable last year reported numbers and similarly, 1990 EBITDA comparable as in Ind AS adjusted. I think the overall Info Edge margin was about 2% lower if you kind of do the Ind AS adjustments. Okay. One second. The recruitment comparable margin, basically. I'll give you one second. I think Hitesh called out earlier. No, recruitment. It's lower than both. I'll just read out everything. Operating EBITDA for recruitment stood at INR 114.91 crore. Margins of 52.8% versus 56.8% last year. EBITDA readjusted for Ind AS 116 stood at rupees 111.8 crore at a margin of 50.9%. Yeah. Does that answer your question? Yeah. That does. 50.9 is what I was looking for. All right. Similarly, 99acres has a comparable EBITDA? 99acres. I think you mentioned INR 24 lakhs. 24 lakhs versus a loss of INR 1.62 crores, if you take- Okay. Adjust for India. Okay, got it. The second thing, sir, I was looking at Naukri JobSpeak Index. For the last two months especially, the JobSpeak Index grew by 6% and 14%, while there was strong growth in IT of 26% and 31% IT software. I don't understand, if the IT, which is our biggest component of job or basically biggest component of Naukri.com, is growing so well, what is causing this overall JobSpeak Index to come down? I mean. It's because there are many sectors. Are there any sectors back? Yeah. Some sectors, like I mentioned earlier on the call, are in trouble. Sectors like the financial services sector, sectors like auto, sectors like telecom, sectors like the infrastructure, construction, real estate. They continue to either de-grow or grow in very, very low single digits. Because of these, the jobs take is pulling down. The last question is on essentially 99acres. In the last one or two quarters, even on a normal basis, I mean, on a normal adjusted base, we are growing by 30-odd%. This quarter it has come off a bit at 18% billing growth. Do you think this is to continue for a while, if the underlying market remains as it is? If we remember correctly, 30-odd% growth was coming on a higher base, which was adjusted last year, this has come off of it. Will this be a new normal going forward, or do you think this can improve? This might be a one-quarter thing. Well, it's really hard for me to say because there's so much happening in that market. There are all kinds of trends, and in some geographies we are doing well, in some geographies we are not doing so well. I think we should wait and watch for one more quarter before we come to a conclusion on what should be the new normal for us going forward. Just addition to this question, sir, how is the builder market versus the agents market doing in this? Still the agents market providing the better revenue growth? Yeah, the agent business continues to do well. See, the Delhi market, for example, is largely. Correct is largely an agent market. Right. While the markets in the south are largely builder-led. Like I said, in this quarter, we saw strong growth in some markets, weak growth in others. By and large, yes, of course, the agent piece continues to do well and continues to grow well for us. If south is doing well, for example, there are no agents in the south. That means in that particular quarter, the builder market may do better than the agent market. Trend-wise, I think the business over time will more and more move towards agents. Okay. Got it. Thank you. That's all from my side. Thank you. Anyone who wishes to ask a question may press star and 1 on their touch-tone phone. As there are no further questions from the participants, I'd now like to hand the conference over to Mr. Hitesh Oberoi for closing comments. Sir, over to you. Yeah. Thank you so much for staying back till late for this call. We got a little late today because of our AGM. That's why the call was kept late. Have a great evening, and Happy Independence Day to everybody. Thank you very much, sir. Ladies and gentlemen, on behalf of Info Edge Limited, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines.