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Good evening. My name is Anand Bansal. My colleague, Vivek Aggarwal, will help me conduct this conference. Over to you, Vivek.
Good evening, and welcome to Info Edge India Limited Q1 Results Conference Call. [Operator Instructions][Technical Difficulty]
I think there's a problem with Vivek's line. Hitesh, you want to start your opening remarks?
Okay. I'll take the participants through this thing. [Operator Instructions] Please note that this conference is being recorded.Joining us today from the management side, we have Mr. Sanjeev Bikhchandani, Founder and Vice Chairman; Mr. Hitesh Oberoi, Co-Promoter and Managing Director; and Mr. Chintan Thakkar, Chief Financial Officer.Before we begin today, I would like to remind you that some of the statements made in today's conference call may be forward-looking in nature and may involve risks and uncertainties. Kindly reference Slide #2 of the investor presentation for detailed disclaimer.Now I would like to hand over the conference to Mr. Hitesh Oberoi for his opening remarks. Thank you, and over to you, Hitesh.
Thank you, Anand. And a very good evening -- warm sort of evening, and welcome to our first quarter conference call for FY '21. At the very outset, we are very, very grateful to all our existing and new investors for the faith reposed by them in us. Thank you for helping us close successful QIP in the middle of the COVID crisis. The shareholder resolution to raise funds was approved on July 27, 2020, and the QIP was launched on the 4th of August 2020.We got a demand of 6x our planned fundraise from both existing and many new marquee investors. In the end, we raised INR 1,875 crores at INR 3,090 per share, a discount of 2.74% to the SEBI floor price. The funds raised through the process, INR 1,875 crores, along with our existing cash balance of over INR 1,500 crores, will be utilized to leverage both organic and inorganic opportunities that may arise in our core verticals going forward.Moving on to our stand-alone financial results for the quarter. Billings in Q1 were INR 188.6 crores, down 43.9% year-on-year. Revenue in Q1 was INR 280.1 crore, down 10.4% year-on-year. Operating expenses, excluding depreciation for the quarter, were INR 175.6 crores, down 17.1% year-on-year. And operating EBITDA stood at INR 104.6 crores versus INR 101 crore last year, an increase of 3.5% year-on-year.Operating EBITDA margin for the quarter stood at 37.3% compared to 32.3% last year. And EBITDA adjusted for ESOP noncash charges stood at INR 110.8 crores versus INR 106.2 crores in Q1 of last financial year. EBITDA margin adjusted for ESOPs for the quarter stood at 39.6% versus 33.9% in Q1 of FY '20. And cash EBITDA for the quarter stood at INR 13.72 crores.Deferred sales revenue stood at INR 371.7 crores as of June 30, 2020, versus INR 495.3 crores as of June 30, 2019, a decline of 25% year-on-year. And the cash balance in IEIL and its 100% subsidiaries stands at INR 1,530 crores as of June 30, 2020. This was INR 1,553 crores as on June 30, 2019.Moving on to the consolidated financial results for the quarter. At the consolidated level, the net sales of the company stood at INR 285 crores in Q1 '21 versus INR 319.7 crores for Q1 of 2020. For the consolidated entity at the total comprehensive income level, there is a profit of INR 94.4 crores versus a loss of INR 192.1 crores for the previous quarter ending June 30, 2019. And adjusted for the exceptional items, PAT stood at a profit of INR 87.6 crores in Q1 '21 versus a loss of INR 187.9 crores in the quarter ending June 30, 2019.The aggregate top line of the investing companies in FY '20 declined to INR 571 crores versus INR 866.2 crores last year, a decrease of 34%.Now let's move on to the results by segments. First, we'll cover the recruitment segment. In Q1 in 2020-'21, recruitment segment billings were INR 140.3 crores, down 44.3% year-on-year, while revenues were INR 200.2 crores, a decline of 8.8% year-on-year. Operating EBITDA stood at INR 120.7 crores, up 5% from June '19. Margins were at 60.3% versus 52.4%, stood at INR 123.6 crores at 61.7% versus 53.5% in Q1 of 2020. And cash EBITDA for the Recruitment quarter -- for the recruitment business during the quarter stood at INR 60.8 crores.We saw some recovery in June across various segments suggesting a revival in business as the economy was unlocked. Y-o-Y growth -- or improved to minus 38% in June from minus 54% in April. So there are signs that things will get better going forward.The IT and telecom sort of services segments major contributor of billing improved from minus 45% decline in April to a minus 27% decline in June. Travel and hospitality, automotive manufacturing, industrial services continue to be the most impacted. The retail segment also is showing signs of recovery -- showed some signs of recovery in June after a large decline in April and May.The lockdown impacted job seeker -- both job seeker and recruiter activity on the platform in the month of April and May. And we added an average of 8,400 CVs per day only in Q1 of 2021, down by 50% compared to Q1 of 2020. We also curtailed our marketing spend substantially in this period. Average CV modifications were at 324,000 per day in Q1, a decline of 20% year-on-year. Our traffic share in the job portal space was not impacted and continue to be in the 90s.We are, of course, now seeing a significant improvement of traffic on the platform in Q2 as the economy has opened up. Job seeker traffic is back to pre-COVID levels year-on-year and recruiter traffic has also improved significantly. From a decline of 65% in May, it is now down 35% year-on-year. And of course -- and this is despite almost 0 expenditure on marketing.We continue our focus on product investments, specifically in the recruitment management system as automation and technology will play a critical role in the emerging work-from-home scenario, remote collaboration and higher productivity and expectations post COVID.iimjobs.com reported a billing of INR 3.16 crores in Q1, down 44.1% from Q1 of 2020. iimjobs revenue for the quarter stood at INR 4.94 crores, up 4.67% from Q1 of 2019.Moving on to the real estate business, 99acres. In 99acres, billings in Q1 declined by 71% year-on-year to INR 14 crores while revenue fell by 24.7% to INR 42.5 crores. EBITDA for the quarter stood at INR 4.1 crores against net profit of -- an EBITDA profit of INR 24 lakhs in Q1 of 2020. EBITDA adjusted for ESOP stood at plus INR 5.5 crores versus a profit of INR 0.9 crores last year in the same quarter. Cash loss for 99acres during the quarter stood at INR 24.5 crores against INR 8.99 crores cash loss last year.In the 99acres business, all business verticals of new home, resale, rental and commercial were impacted in Q1 due to the extended lockdown during the quarter post the slump in April and May, where lockdown was very, very severe. Business started improving gradually in June. Number of clients billed, average billing were both impacted in Q1. On average, smaller cities showed lesser decline in billings compared to the larger metros. We reduced our expenses in 99acres by 32% year-on-year in Q1. Both marketing and other expenditure were cut.By the end of Q1, daily listings posted by owners had fully recovered to almost pre-COVID levels, which is Feb 20 levels, while broker listings are recovering but at a slower rate with brokers being more cautious in spending money due to lockdown restrictions still existing in some shape and form in their cities. While traffic was severely hit in April, traffic on the site recovered to 85% of pre-COVID levels by the end of June. Our traffic brand share versus our nearest competitor, MagicBricks, inched up slightly to 57% in Q1 compared to 55% in Q4 as per Google search trends.We continue to see a strong revival of traffic and inquiries through the platform in July and August. By the last week of August, buyer traffic visitors were up 11% compared to pre-COVID and 3% year-on-year. By the last week of August, buyer inquiries were up 34% compared to pre-COVID levels and 65% year-on-year. We expect this improvement to sustain in the new homes segment, in fact to some extent even surprised by the rise of deals by the rapid sort of return of real estate as sort of search activity on our platform in the last 2 or 3 months.More clients are also looking to come back to advertise on the platform, and we expect business to keep improving with every passing month. The share of online medium in the overall spend of advertisers is likely to go up due to its inherent cost efficiency versus print and hoardings. We continue to invest aggressively on improving our platform experience in this downturn in all our business verticals to come out stronger post the crisis.In Jeevansathi, billings grew 13.3% year-on-year in Q1 to INR 22.8 crores and revenues grew 13.2% year-on-year to INR 22.5 crores. Operating EBITDA losses stood at INR 13.3 crores in Q1 of FY '21, up from a loss of INR 8.8 crores last year. EBITDA readjusted for ESOP stood at a loss of INR 12.9 crores in Q1 versus a loss of INR 8.7 crore last year. Cash loss of Jeevansathi during the quarter stood at INR 13.3 crores.In Q1, Jeevansathi saw further acceleration in profile growth rates and higher traffic on the platform, again, because of the lockdown, people are stuck at home and they've maybe got more time to search Jeevansathi. Sales growth slowed down in the first few weeks but has consistently improved since then.Some of our sort of industry-first features like video calling, video profiles and video-based online meet-ups launched in the last financial year helped the business drive growth and in user engagement in the quarter. Aggressive marketing spends during the quarter along with continued improvement in realizations helped maintain relatively higher sales growth. We continue to consolidate our position as we penetrate deeper into our core markets. We plan to spend considerably more on marketing going forward across all our markets to strengthen our brand presence in the matrimony space.Moving to the Shiksha or the education vertical. In Q1, in Shiksha, billings declined by 28.4% year-on-year to INR 11.5 crores while revenue declined by 11.8% year-on-year to INR 14.9 crores. This was mostly on account of the education sort of -- admission season getting deferred at most colleges and universities. We made an EBITDA of INR 2.1 crores versus an EBITDA of INR 4.3 crores in Q1 of 2020. EBITDA readjusted for ESOP for the quarter stood at INR 2.7 crores versus an EBITDA of INR 4.5 crores reported last year while cash loss for the quarter stood at INR 1.3 crores.We made significant traffic share gains during the quarter. Shiksha continues to gain traffic share despite heightened competition from different players in this. We continue to invest in making our content more comprehensive and more student-friendly and in building deep domain expertise. This will hopefully help us in generating more response for our clients going forward.Moving on to our strategic investment. Since the easing of lockdown restrictions, we have seen the recovery of business in most of our investing companies like Zomato, Ustraa, ShopKirana business, among others. For Zomato along with the bounce back in order volumes, profitability of food delivery business has improved. And the monthly cash rate of the company -- cash burn of the company has come down significantly. Zomato now has adequate capital with strong inbound investor interest.Policybazaar also continues to grow and is not expected to much -- burn much cash in its operations going forward. Paisabazaar, which saw a major decline in business, has also seen a business bounce back in the last couple of months.We've made 3 new investments through our SEBI-registered Category II AIF Info Edge Venture Fund, which we had announced last quarter. Our investee company, Happily Unmarried, which owns the brand Ustraa, closed a new round of funding of INR 50 crores from a new institutional investor. We also made a follow-on investment in our investee company Bizness, which raised primary funding of INR 64 crores co-led by 2 new institutional investors. And we continue to evaluate new investment opportunities.That's it. Thank you. This is all from me right now, and we're, of course, happy to take questions.
Thank you, Hitesh. We'll now begin the question-and-answer session. [Operator Instructions]
So the first question is from Vivekanand Subbaraman from AMBIT.
I have 3 questions. One is the billing recovery that we saw in the first half of July compared to the first quarter sharp drop. Is there any further recovery and -- in the months of July, second half of July, August? And what are the billing trends in the key cities and sectors? That's question one.Second question is, Hitesh, while you were mentioning about the buyer traffic on 99acres, you mentioned about the end August trends. It was very unclear. Your line was problematic. So we did not get what you were trying to say about the buyer traffic. If you could just highlight those numbers again and build on them in terms of why the sector or why 99acres is seeing so much more buyer traffic now? And will that translate into a better monetization for you?The last question is on, any thoughts on the new normal as far as our operating costs are concerned? And is there any link between revenue and employee incentives? Just trying to understand what part of the cost control that we demonstrated in the first quarter is sustainable?
Okay. So first question was around billing in July and August. So of course, July and August are doing much better than April, May and June. Like I've said, buyer traffic -- sorry, job seeker traffic in Naukri is back to where it was last year. And in fact, on some metrics, we are growing at 15%, 20% over last year as well. Recruiter activity is back to 65% levels. Now of course, let's see what happens to billing because a lot of our billing actually for the quarter will happen in September because that's when a lot of sort of subscriptions are due for renewal. But clearly, July and August are tracking much better than April, May and June. And of course, we've been on track on the [ passing ]. And this is when you're not spending much on marketing.And the same -- we're seeing the same in the real estate business. Our billings were down 71% last quarter, but both July and August were pretty decent. We're still not back to base. We're still not back to the numbers we were doing last year, but it's getting better and better with every passing sort of week. Let's -- again, let's see what happens in the month of September.Now buyer activity on 99acres is actually back with a bang. While the number of people visiting the platform are up -- are also up over last year, what we've seen is a massive surge in response from where we were last year. So on the resale side, for example, buyer inquiries are up 65% year-on-year, right? That's a massive jump inquiries on the resale side. On the new home side also inquiries are up. On the rental side, we are still down compared to last year in terms of the number of inquiries on the platform, but rentals are a very small part of our overall business.Now let's see if this also sustains going forward. Right now, revenues will follow is also because of a lot of seller actually in the platform. So a lot of owners are coming in and sticking their properties directly as well, more than what was the case last year. Dealers have...
Hitesh, your voice is breaking. You maybe sort of on mute.
Dealers -- am I more audible now?
Yes, this is better. Thanks.
So dealers and developers have been slower to get back onto the platform because they were not sure on whether people -- on sort of moving out of their houses and taking people for site visits. But now with buyers coming back and with listings coming back onto the platform, we are seeing dealers and developers also come back to the platform. The number of active dealers and developers and projects on the platform is also improving, week on week. We are still not back to the levels we saw -- we were at last year, but it's getting better and better with every passing week. Since we make most of our revenue from dealers and developers, revenue will sort of lag traffic by a few weeks, right?Your third question was on what, sorry?
That was on the new normal as far as operating costs. And just trying to understand the cost control that we saw in the current quarter, what part of that is sustainable?
So a lot will depend on what happens to the market. Going forward, if the market comes back quickly, then of course -- see what we basically -- the cost control in Q1 was on account of the fact that we did not give a salary increase in Q1. We've sort of put that on hold, number one. Number two, we also put fresh hiring on hold. And number three, we cut marketing sort of expenditure, especially in Naukri and 99acres. And number four, since we are not -- we are working from home and not out of office, we saved a fair amount of money on admin costs.Now going forward, if we see business bouncing back and if competition also bounces back, then our marketing expenditure will go up. Certainly, it will go up in Jeevansathi because that's our plan. We are planning to spend a lot more in Jeevansathi going forward. That's a business which is growing for us. And the growth rate in Jeevansathi has been improving month-on-month for the last few months.In Naukri and 99acres, we'll start -- probably start spending on marketing once we see the market sort of come back. Our admin expenses will remain low for a while till we start going back -- till we -- but if we go back to working from office, and that is going to be a function of the COVID situation. Those costs will remain under control for some time. But yes, we'll have to spend -- we are spending a lot more on IT cost, IT infra, because we have to sort of -- we need to buy more software, we need to buy more licenses to enable our people to work from home better.So on hiring, we have seen demand for digital talent go up in the market. So we maybe to sort of forced to look -- relook at -- revisit our decision on putting salary increases on hold, at least for the IT talent in the company going forward. We may also -- and as far as sales incentives go, they are not -- the incentives we pay out are not linked to absolute sales. They are linked to the target we set for salespeople in the company. Targets, we believe should be stretched, but they should be achievable. So it is possible that even on lower targets, salespeople will end up making incentives going forward because we would like to keep them to remain motivated and sort of do their best.So to some extent, our cost will be a function of how fast business recovers. If business recovers quickly, our cost will go up once again. On the other hand, if the recovery is slow, then at least advertising costs for 99acres and Naukri and [Audio Gap]
Just one small follow-up. So within recruitment, what are the segment and city-wise trends that you're observing? Is IT recovering faster than others? Is Bangalore doing better? And any trends that you want to call out?
Yes. See, clearly, certain sectors have been impacted more than others. So sectors like auto, retailing, travel, tourism, hospitality, construction, real estate were impacted the most in Q1. We saw traffic -- sort of listings and recruiter activity climb by 70%, 80%, 90% in some of these sectors. Sectors like IT, pharmaceuticals, consumer goods, education were impacted a lot. So there, we saw a decline in activity of around 35%, 40% in Q1. The IT sector has also been -- has also bounced back, I don't remember the exact details. Activity from IT companies was down only 27%. So it's very likely that some of these sectors have been impacted the least in the months of April, May, June and will also bounce back the fastest. Travel, hospitality, apparel, retailing, they will still take some time to sort of -- I mean it will be a while before these sectors bounce back.
So the next question is from Parag Gupta. He is from Morgan Stanley.
Congratulations, Sanjeev and Hitesh, for a successful QIP. So I had 2 questions. Now that you have close to $450 million of cash on the balance sheet while you did mention last time that you would like to keep back some for operational expenses and just keeping it for a rainy day, but with the extra cash that you have, have you thought of any potential opportunities in the marketplace that you could be going after? So just wanted to get some evolving thoughts from you at this point in time as to which segment and what is it that you're likely to do with that cash?And the second question is just on competition. Have you seen any significant shakeup in the segments that you operate in? Let's say, more from a core business perspective, anything in 99acres -- real estate or anything in matrimony, which could potentially create M&A opportunities? And relatedly, is there anything that could happen for some of your investee companies? So just your thoughts on that will be great.
Okay. I think, firstly, you should congratulate Chintan also because he is the one who spearheaded the QIP, entire QIP process. So we were sort of, of course, putting up in front of investors, but he was the guy running the show. So that's one. And see, as far as uses of funds go, see, what we said while raising money also was that we would like to push the pedal on some of the internal businesses we have in the company. The jobs, of course, we continue to do well, and we are investing in a bunch of adjacent areas around Naukri. So we are experimenting with the blue collar job board. We are trying out an AI-based hiring platform. We're doing a bunch of other things. We have the RMS business. We are pushing -- we want to push a little more aggressively.But in both matrimony and real estate, maybe the time has come for us sort of double investments. The truth of the matter is that the real estate vertical is a very large vertical. We are a leader, but we are not a dominant player in this vertical. We are not as dominant as we are in jobs. In matrimony, we are a strong #2 player in the North and West. We are #3 nationally. So again, there is -- we see a huge opportunity there to gain share if you push the pedal on marketing and acquisition.So one, this money will be used to aggressively invest in all the internal businesses. And we will sort of do this both organically. And if there are inorganic opportunities, we would like to pursue them as well. Now the number of inorganic opportunities out there, which are of interest to us, maybe you can count on the fingers of 2 hands. They are not that many number. Are we in active conversations with anybody at this point in time? The answer is no. But if an attractive opportunity comes our way, we will be more than happy to grab it in some other of the verticals in which we already operate.So that's really what -- so we don't want to sort of raise and scramble for funds at that point in time, and that's why we did the QIP in August. We expect something to emerge in one of these areas at least over the next 12 to 18 months, some opportunity. Now is there -- is the probability 100%? No. But maybe there is a 50%, 60% chance that something might happen in the next 12 to 18 months, let's see.So that's really the plan. On the -- yes, did I answer your question? Is there anything else that you would like to know?
I think that answers the questions on the funds. And just if you can give us a sense of competitive intensity. Has that -- is there a significant shakeup or have some of your key competitors just paused and will likely come back when things start recovering?
See, for the last few months, everything is very quiet. And I think people have started just waiting and watching to see how it evolves -- how the situation evolves. Everybody was impacted majorly by what happened in April and May and in May people were taken by surprise -- totally by surprise. There was a -- the lockdown is very stringent. And like I said, our business was impacted, recruitment was impacted 44%, 99acres was down 71%. That's how stringent the lockdown was. Things are now beginning to return to normal. So I think the action will start in a month or 2 if the situation continues to get better. So has there been any major change in the last few months that we noticed? No. But yes, in any slowdown, what you've seen in the past is that the #3 and the #4 players get impacted the most. The #1 player is always impacted the least because if [Audio Gap]
Hitesh, we can't hear you. Why don't you switch off your video?
[indiscernible] have to choose one, normally happens in a slowdown is that [Audio Gap] the #3, #4 players sort of always sort of end up on the weaker side. So let's see how this plays out. A lot will depend on how fast the market recovers going forward.
The next question is from Manjubhashini from Sundaram Mutual.
Sure. Sir, just want to understand, you did mention about the utilization of funds and how there may be some certain opportunities that may come your way therein. So I'm only trying to understand, given the current situation and where things are for competition as well as for us, what would you look at in these names which may become your targets in the near term? Is it going to be the geographical presence, the scale or the niche? Or what are the things that you would look at in these potential targets therein that might be of interest to you?
See, our ideal sort of candidate for acquisition would be somebody -- would be some -- a company in a space in which we already operate, a space which we already understand. Ideally, a candidate for acquisition should help us get to clear leadership in the markets we operate in because that's what ultimately drives pricing power and margins in our business. Ideally, it should be a sort of reasonably large company. I mean we'll keep doing small acquisitions as well, but our ideal candidate would be somebody which is at least a reasonable top line company. So these are some of the things we would sort of look at. But like I said, the number of targets out there, you can count on the fingers or maybe 2 hands at max. So there aren't that many sort of companies in the spaces we operate, which sort of meet all these criteria. And so let's see if we can make it happen.
The next question is from Mukul Garg from Haitong Securities.
Yes.
Mukul, can you come close to the mic, I can't hear you.
Yes, Sanjeev, is this better?
Much better. Thanks.
Great. Hitesh, just wanted to follow-up on the question about acquisition and QIP. If I look at your commentary, 12 to 18 months seems a fairly long period. Have you seen any opportunity go away or reduce over the last 1 to 2 months given that you moved quite rapidly on the QIP? Is the ask rate still too high for you to be comfortable acquiring or making an offer to someone?
See nothing which is of any value in the Internet sort of space is very cheap, right? So all acquisitions will come at a certain price. And of course, for the good assets, you will have to pay what -- a good price. But like I said, see if this -- these acquisitions help us -- nothing has sort of gone away. Everything is -- no other -- no company, we are sort of looking at, has been acquired by anybody or has sort of done a deal with anybody else. So -- but -- so any acquisition we do should help us gain more share, improve our pricing power or help us maybe get into sort of adjacent new markets, increase the addressable sort of opportunity for us -- market opportunity for us in the medium term or maybe it should be a new business model, something -- we are mostly in advertising sort of listings and subscriptions kind of company. We've experimented with transaction once, but that was a long time back. So we could also look at transaction plates in the spaces we operate or in adjacent areas. So why it could take 12 to 18 months is because we would want to do the right deal and we would want to pay the right price and we would want to buy the right company. And sometimes these things take time. We would not want to rush into an acquisition just because we raised money.
Understood. And the second question was on the margin performance, quite good this quarter. And I think you very clearly explained the impact on various moving parts. But in the scenario which you also alluded to, if things get back to normal soon, the revenues, conversion of billing will obviously take some time. So will that have a meaningful impact on your margins? Or will you kind of keep your cost under control till revenue growth comes back? And second part of this question is, at what margin levels are you guys comfortable because I think clearly, you're running at close to all-time high on Naukri?
See, clearly, these margins are not going to sustain because, see, the revenue or the margins are a function of revenue and cost. And yes, our cost declined this quarter, but our billings declined by 44%, and that was not reflected completely in revenue. And that's going to get reflected in our revenue going forward, right? So a 44% decline in Q1 will result in much lower revenue growth in Q2 unless billings in Q2 go up substantially. So let's see how this plays out. See, from our standpoint we are not wedded to margins or anything of that. So we want to run -- if there is a good opportunity which comes our way, we would like to grab it. So if we see the market recovering and we see an opportunity to sort of push the pedal and gain share, then we're not going to think about how margin will be impacted in that quarter or whether cost will go out of control and stuff like that, right?So we would like to play by the year. We would like to see what's happening in the market and react appropriately. Like I said, we are already seeing signs -- some signs of a bounce back in 99acres. So if that continues, then we may start investing more in 99acres without waiting for the market to return to normal everywhere.In Jeevansathi, we did not see any revenue decline at all. In Q1, we -- our revenue grew by -- billings, in fact, grew by 13%. In the months of July and August, billings have grown even faster. So we are sensing an opportunity there. We want to double down in Jeevansathi. We were going to up our marketing investments in Jeevansathi this quarter itself. So we're going to be more led by what's happening in the market, what's happening with competition, what opportunities we are seeing. We don't want to sort of, in the short term, manage margins, manage costs and give up on the long-term opportunity.
Great. The last one was on Zomato. A couple of quick ones there; a, what is the current burn rate that Zomato has in the most recent month? On the fundraise side, is the fund raise over now? What was the total amount which they raised eventually?
We have not made an announcement of any fund raise on Zomato. We will make those announcements in due course of time as and when the fundraise happens -- should the fundraise happen.
Okay. So the inbound investor interest which Hitesh mentioned is basically something which is on the horizon, but it is not at least...
Look, Zomato has got enough money, but it probably will raise more money and there's enough investor interest.
Fair enough. And Sanjeev, on the cash burn side and return to the pre-COVID level delivery volumes, if you can give some comments on what are the run rate...
No, it hasn't yet returned to pre-COVID level, delivery volumes. See, basically, roughly about -- when I last checked a couple of -- a few days back, their estimate was maybe 65% to 70% of restaurants that were shut down have opened. And delivery revenue is back to about maybe similar levels as pre-COVID, okay? Now that does not mean volume is back. It means -- necessarily, it means that it's possible that they are charging higher delivery fees. They're charging a higher take rate, giving less discounts and so on and so forth. But overall, it's a much healthier business.I think for the restaurant sector as a whole to recover to where it was earlier, I mean estimated is maybe [ 20%, 25% ] restaurants will never open and then new ones will come and take their place. But that might take a year or so because, see, most restaurants can't survive purely on delivery because they need dining in revenue, okay? Now if you're paying rentals, which are not our cloud kitchen, which are not in the back lanes, you're paying high street rentals, you definitely need dine-in. So until dine-in happens, restaurant industry will not really be healthy. Delivery won't really take the restaurant industry so far. It will take Zomato very far. But the restaurant industry as such, it will take them only so far because people are stuck in the locations, they're already there. Until dine-in happens, we can't make money in locations purely on delivery.
The next question is from [ Roney Kapoor ]. He's an individual investor.
I want to know that the basic operations of the company is of technologies, but your all investments are related like the private equity firm?
Sorry, I didn't understand your question.
My question is that the main operation of the company is related to the technology, but all the investments are related like a private equity firm.
Well, actually, the investments in external start-ups are in largely tech-enabled tech companies, right? So whether you look at any of our investments, there will be a tech angle to it. Now we invest behind our internal businesses. We invest behind start-ups in the -- adjacency to our internal businesses. We try to acquire companies in the verticals which we operate. And we also invest in start-ups that are not in these 4 verticals, right? So Zomato is not in one of the 4 verticals that we operate. Policybazaar is not in one of the 4 verticals we operate, neither is ShopKirana nor is Gramaphone, nor is Ustraa, nor is ShoeKonnect, which is now called Bizness. But they all have a tech angle to it or a consumer internet angle to it or a B2B SaaS angle to it, Shipsy for example, right?So I would say we are tech investors. We are a tech company, and we invest in our own businesses. We invest in start-ups which are in the milieu of our own businesses. We try and acquire companies in the vertical where we operate. And we also invest in start-ups that are not in the 4 verticals in which we operate, but all of them are tech.
The next question is from Sunil Shah from Turtle Star.
My questions have been answered on the cash and the acquisition.
The next question is from Gautam Beri.
I'm sorry, I think I raised my hand by mistake.
The next question is from Vatsal Modi.
Am I audible?
A little closer to the mic, please?
Yes. Is this better?
Much better. Thank you.
So Hitesh, I wanted to understand a little bit more about the impact of this rise in digital adoption that we are seeing across the ecosystem. So would it be fair to say that a large part of the Internet...
Can everybody else go on mute, please? Sanjeev, can you go on mute?
I think another participant, Sunil, is unmuted. But anyway, I'll continue. See if you can...
Okay. Please carry on. It is better now, actually. I think we've lost -- Anand, I think we've lost him. Anand, you're on mute.
Yes, so we'll go to the next question as of now. So the next question is from Utkarsh Solapurwala. He's from Damos Capital.
I have 2 questions. First on Policybazaar, what has been the growth rate of the company in last 1 year? And is it company profitable? And second is on Zomato. If 30% of restaurant closes down, then will Zomato be able to recover its pre-COVID volume in next 1 year or will it take longer? And what is the expected growth that you are looking in Zomato for the next 1, 2 years?
Okay. So neither of these companies give out specific numbers of their growths. So we can't disclose that. But look, Zomato is coming back nicely with delivery volumes, the delivery value run and also the volume. We expect in the few months' time, they will be back to pre-COVID level, but we have to wait and watch, if there is a second wave sort of thing, if there are further lockdowns sort of thing. We are still waiting and watching.In Policybazaar, the Paisabazaar business was badly hit, largely because employees won't go out and do KYC of prospective customers. The insurance part of the business, which is Policybazaar, grew nicely, right? We expect this growth to continue, but we have to wait and watch.
Yes. So the next question is from [ Nikhil Pahwa ].
Sanjeev, Hitesh, I just wanted to get a sense of -- there are a couple of regulatory headwinds coming up, particularly in case of the Personal Data Protection Bill as well as this report on nonpersonal data, which could lead to other companies potentially accessing aggregate data or anonymized data. Since most of your businesses rely heavily on the data that you have, I was wondering about what kind of -- what are your views on these situations? What -- and what are your expectations of what's going to happen?
So some of these sort of reports have been brought to our notice. But we haven't required to go through them in detail. You're absolutely right that some of these things really concern us. And -- see, so from our standpoint, we are a data company. We take all possible precautions to protect and guard our data. We make it available only to recruiters for recruitment purposes in the case of Naukri and so on. But yes, any -- if the law changes and it could impact us positive or negatively, we are yet to deep dive and understand what the implications of the proposed set of, sort of, bill are.
Yes. So Nikhil, see, our view is that an individual's data belongs to the individual. If he has come and entered his resume in our database, he has entered it for a particular purpose under certain terms and conditions, and we'll only use it for that. So even if we are allowed to use it for something else by law, the truth is we'll honor our commitment to our users and use the data only for what we have committed to be using for. We will not violate that commitment to our users. Now having said that, obviously, we have to follow the law of the land, and we -- and that is still emerging. And we are going to -- we know how to deal with that.
And Sanjeev, particularly in case of the nonpersonal data, the -- what the committee's recommendation is that other businesses and the government should be able to access anonymized data sets and also aggregate information that you may have from your databases and that can be -- you would have to give that mandatorily if demanded potentially.
No. No. Mandatorily demanded by the government. I don't believe a private company can mandatorily demand our data in anonymized manner, okay? I cannot, for example, go and demand LinkedIn, Zeta in an anonymized manner. I'm a private company, right? So if the government...
Actually, that is a part of the report. Private companies can also demand data from other private companies.
I don't -- that -- well, we'll have to look at that. I think that is quite unusual, which will give us an opportunity also to demand other people's data if that is the case.
So I will let [ Vatsal ] take up his question because, I think, he was there in the queue before.
Yes. Sorry. So Hitesh, what I was trying to understand is, is it fair to say that the rise in digital adoption will benefit the blue-collar segment a lot more. But in the white-collar segment, a large part of the candidates are already online. So there's no incremental benefit as such that you might get in the white-collar space. Is that fair to say? Or do you think the SMEs getting online could help the white-collar side as well?
No. There'll be some benefit. You're absolutely right that many of the white-collar sort of workers are already online. But even there, what will happen with time is that bandwidth will improve, speed will get better, Internet will get faster, all that will happen. So that will benefit us in some way. But yes, from a new user sort of standpoint, it won't have many -- any incremental benefit.But what can also -- what will also happen as a result of this is that our platforms will hopefully become richer over time. So like I mentioned earlier, we've already introduced a video profile on Jeevansathi. We are experimenting with video profiles in iimjobs. We are going to experiment with video profiles in Naukri very soon. Video interviewing will be enabled over time. Video calling has been enabled in Jeevansathi. So there'll be some benefits because the platforms will become richer in terms of content, in terms of experience over time because people will have access to cheaper bandwidth.
Got it. No, that's useful. And how are 99acres, Jeevansathi, are you expecting a lot more users to also sort of get on these platforms? Or again, similar in terms of benefits there?
No. We expect more users as well. For example, Jeevansathi has been growing very handsomely in the Tier 3 and Tier 4 cities of this country for the last couple of years. So many of these sort of users in these cities were not online until some time back. And again, it's a very rich site, lots of photos, lots of pictures. We're introducing video as well, calling as well. So penetration -- increased penetration is certainly helping the Jeevansathi business. Like you mentioned, it'll help the blue-collar job boards as well over time.On the real estate side also, real estate is bought and sold in every nook and corner of this country. So it'll benefit real estate side also, especially on the rental side because rentals are often sort of the user base or people who sort of take houses on rent. Not everybody pays INR 20,000, INR 30,000 a month of rent. There are enough people who pay INR 2,000, INR 3,000, INR 1,000, INR 4,000 for rental as well. So it'll help us get those users, those landlords on the platform as well over time.So certainly, all these things will help with more penetration in Tier 2, Tier 3, Tier 4 cities and will sort of also over time results in platforms becoming much more richer in terms of content.
Next question is from [ Aditya Vora ].
Am I audible?
Yes, please go ahead.
Hitesh, Sanjeev and Chintan, and congratulations on a successful QIP and a good set of Q1 numbers for you and the team. I have 2 questions. The first one being, with the increased consumption of video content during the lockdown and after coronavirus hit, what is the impact that we are seeing on a business such as Qyuki? Are there -- is there any commentary that you have that might be meaningful in that respect?And the second question is on the competitive intensity that has been seen in the food delivery space, where a quarter ago, Amazon had piloted its service in Bangalore. Some color on that, if available.
I'll answer the second question first. As of now, there does not seem to be a major push by Amazon to either scale up that service, but obviously, it's something which Zomato is watching. And is figuring out how to deal with the situation where Amazon gets -- scales it up and puts a lot of money -- investment behind that initiative.As far as Qyuki is concerned, look, that -- Qyuki had a bit of a -- quite a setback actually because the founder and CEO passed away a couple of months back in a road accident. And so the management team is still stabilizing the situation post that. The company is doing all right. Burn is coming down a bit. But for it to make major initiatives and move forward will take a little time.
The next question is from Vinayak Mohta. He is from Augmenta Research.
Yes, sir. So I basically had 2 questions. So first one was if you could give a number on what is the cash burn for Zomato on a monthly basis?And the second question would be, like, can you please highlight like you -- a while back, you had -- you were looking for some major opportunities and you were having cash on your hand. So have you started investing that cash into some PE investments? Or how is it that like -- what is your strategy out here? So I have these 2 questions.
So Zomato does not disclose the specific burn numbers month-on-month, but it is substantially down. Having said that, the burn may go up a bit in the coming months because they are reinstating the salaries they had cut and they may start investing in brand. But I think the unit economics will continue to be prudent and sensible. And these are overheads that we're talking about.As far as the cash on hand is concerned, our -- first of all, we don't do PE investments. We do early-stage investments, it'll be double down. So I wouldn't call our investments PE investments. I would say seed, Series A, maybe a little bit off rec. We continue to look for investments, but we divide our investments in 2 or 3 buckets. One is investments in start-ups that are operating in the same verticals as we operate, which is jobs, real estate, matrimony and education classifieds. Here, we could do a minority investment, we could do a majority investment, we could do an acquisition, right?The second is investment -- further investments behind those companies where we've already invested earlier from the Info Edge balance sheet or an Info Edge subsidiary balance sheet. These would be Zomato, Policybazaar, it could be Gramaphone, it could be ShopKirana, it could be Ustraa, it could be ShoeKonnect, those kind of companies. That set of companies.And then there are fresh investments in companies that we have not invested in earlier, which are not in the spaces where we operate businesses, right? So those will be through the AIF that we've floated in January. And some investments have been made through that already. And so that's a new vehicle we've floated for further new investments in areas that we don't operate.
The next question is from Vijit Jain from Citi.
Can you hear me?
Yes, please go ahead.
Congratulations first on a great QIP. My question is more to the comment that Hitesh earlier made about pushing pedal to the core businesses. On specifically Naukri, when I see the revenue mix, right, I see around more than 50% of it is coming from the resume database, and there are 2 or 3 other areas for which you collected -- you monetize that asset.So my question is in this post-COVID scenario where a lot of activity, including business activity is moving to digital, do we -- is your -- do you think this mix will change over time? Where do you think this mix will go in the next 3 to 4 years? Any color on that will be great.And secondly, I missed the part where you talked about the margins that you reported on Naukri in this quarter. So if you could repeat that, that would be great.
So I'll answer your second question first. So Naukri margins, right? That's what you want to know or you want to know Info Edge?
Naukri.
Naukri. So in Naukri, operating EBITDA stood at 124 -- recruitment business operating EBITDA stood at INR 120.7 crores, up 5% from last year. Margins were at 60.3% versus 52.4% in Q1 of last year. And EBITDA readjusted for ESOP stood at INR 123.6 crores at a 61.7% EBITDA margin versus 53.5% in Q1 of 2020.Now to answer your first question, the revenue mix or the product mix. See, unlikely that it will change in a hurry and in the short term because the Resdex product continues to be our best selling product. We, of course, like I said, we've been sort of experimenting with new offerings. We've launched an e-Hire service. We have under -- the recruitment management system, which we introduced in the market. We have a campus hiring product. We are working on -- we are introducing new branding options on the mobile phone. We are working on an enterprise variant of Resdex. But iimjobs, of course, we've started selling in the market. So we've got a bunch of new products out there, but they are all very tiny right now, and they will grow, hopefully, over the next few years. But for the foreseeable future, I think, Resdex will continue to be our star.
Great. And my second question is on Jeevansathi. You mentioned that you're seeing month-on-month increase in activity, month-on-month increase in revenues as well on that platform. So I'm just curious because, historically, I've understood matrimonial businesses, not just the fact that you are #2 there in North India but also that it's overall quite fragmented. So I'm wondering if over time, and this is something Sanjeev alluded to earlier, over time platform enrichment and those kinds of things will make it more difficult for the smaller players to even stay in the business. And is that something you're seeing now once you've launched these video call and phone call type features?And secondly, are you looking to increase your share in Jeevansathi mostly through marketing at this point? Or is there a tech angle in there as well?
So the matrimony market is not that fragmented actually. There are 3 large players, Jeevansathi, Shaadi and Matrimony. And then there are a bunch of small players. But I think the large players -- the 3 large players between them control close to maybe 85%, 90% of the market, if not more, right? So it's fairly concentrated in that sense.You're absolutely right, see, in the long run it'll be very hard for the smaller players to match the larger ones on product, technology, innovation because that's not easy to do for the smaller companies. But they will continue to exist in pockets. So -- I mean that's how we have sort of -- as far as investing more in Jeevansathi is concerned, yes, a lot of -- the bulk of our investments are in marketing right now because the only way to gain share is to get more profiles. There's a very direct connection. It's a freemium model. The more profiles you get, the more matches you are able to make on the platform. The more matches you are able to make on the platform, the more sort of people get married through you. And you'll get more sort of revenue, and you'll get more sort of registrations. But we are also investing a lot in technology, like I said, we just enabled video profile in the platform. We've enabled video calling on the platform. We've been organizing online milan samarohs for different communities on the platform.So all these sort of technology -- our mobile app continues to be the best in the business. We continue to innovate on the mobile sort of app front. So all these sort of investments we will continue to sort of do and maybe do even more going forward. But marketing is where the bulk of the money will go in the near term, at least.
The next question is from Prince Poddar from JM Financial.
Can you hear me?
Yes, please go ahead.
Yes. So a couple of questions, Hitesh. First of all, I'm sure a lot of sales in this COVID times would have been closed digitally by the sales team. And being -- sales team being a large proportion of the overall employee cost, do you think any long-term implication we could have on the cost savings front in that? Or would you prefer -- or would the company prefer having more off-line transactions -- off-line interactions with the clients? That is the first question.And the second is, basically, you did talk about the traffic trends in Naukri and 99acres. If you can, can you share some trends which you have observed in the past couple of months in terms of billings? Which direction they have been heading? Is there a recovery or some sort of data on that?
Prince, good to hear from you. See, you're right. See, Zoom is -- our QIP, we sold to investors on Zoom, right? So you don't have to go to any part of the world. In normal circumstances, we would have had to sort of go to the U.S., Europe, Singapore, Hong Kong. We'd have spent hours in flights, days in hotels, all got red eyes, and then we would have sold the QIP. This QIP was done in 1 week on Zoom. In 1 week, we met and sort of interacted with over 100 investors, right, and it was done.So clearly, technology -- this technology, it's a big enabler. And for the last few months, we've trained our sales team on how to sell on Zoom because not all clients want to meet. They would rather sort of talk to you on a phone or zoom call with you. Not enough of them want to meet face-to-face. So it's -- and there are several advantages of this technology. You can -- I can be here and talk to a client in Bangalore. Previously, I would have had to take a flight to go to Bangalore. So you can interact with clients everywhere. Your sales team can be based anywhere, all that. So there are many advantages of using technology. And we'll continue to invest in this technology going forward.But I also believe that once this COVID situation is behind us and things sort of go back to normal, then enough clients would want to meet face-to-face as well. Enough clients would want you to sort of yes, some things can't be done on the phone. There are some things which need to be sort of discussed face-to-face, especially the larger customers, I'm sure, would still want to meet us face-to-face. They may not want to do all their meetings face-to-face if this technology becomes the new normal, but they may still want to meet some of us from time to time face-to-face. So let's see how this evolves. We are sort of getting ready for any sort of situation. Like I said, we are training our sales team to sort of adapt to these new tools. And we think in the long term, it will be a big advantage for us if the world moves to this model. So that's one. Your question -- the second question was on billings, right?
Yes. Billings, trends, basically, if you can share some idea, which -- because you've shared some information on traffic, some trends on billing side would be very useful.
So Chintan, I don't know how much you can talk about billings. Chintan, you're on mute.
I would broadly say that, look, we all know that billing comes in with a lag from traffic number. So there will be some lag. We are hoping that the traffic would be monetized and we keep improving. So it's hard for us to give any guidance or any forecast because also city-to-city situation keeps changing, right? So I think it depends on that as well. So we have seen as the unlocking as the kind of -- as the city -- the COVID number starts going down, we have seen that there is an increase in traffic, then we can monetize it much better. But if it again starts increasing, then it might have some kind of uncertainty involved there as well.
The next question is from [ Pradyumna ] from [ Triton Fund ].
Am I audible?
Yes, please go ahead.
My question was regarding the fund, the AIF that you guys have recently launched. Just wanted to understand the structure of that and whether you're raising external capital? There will be external LPs in that fund as well. And how will that fund be managed? Will it be managed by a separate management entity or would it be managed by the existing team at Info Edge?And also, you mentioned that some of the new noncore investments sort of would be made through that fund going forward. And so in terms of that, would you increase the fund size over time or deploy some more of the capital that you have raised currently through that fund?
Yes. Okay. So first of all, the capital raised currently is not meant for external investments. I mean it is -- our intent is to use it for inorganic growth opportunities, right? Now of course, all money is fungible, but this is our intent, and we intend to do that.Now having said that -- now coming to the AIF, AIF is a Cat II AIF under SEBI. Our initial thought was that we would invest -- let's say, we've earmarked, say, INR 250 crores a year for 3 years as the investment period for this fund, which is roughly equal to what we have invested in last 3 years before this fund was formed. So it's not as if we have committed more money than we'd earlier been investing.When COVID happened, we took a call. So when we've first announced the AIF, we've got a number of people talking to us, would you be looking at raising external money? And our initial intent was we would not raise external money. When COVID happened, we figured that, look, we don't know what's going to happen. Why don't we reduce the demand on Info Edge liquidity over the next 3 years to half of what we'd intended. And so we said we'll put half the money, and half, we'll raise from outside.Now we are not really interested in running a 20, 30, 50 LP fund. We want 1, maybe 2 LPs. And so we're talking to only such people who can put in that kind of money and are interested in doing it.Second, this is structured and a slightly longer fund than most VC funds in India. Most VC funds are 8 plus 2, 9 plus 2, 7 plus 2 years. This is a 12 plus 2 year fund. And the reason is, if you look at most VC funds in India, the exits are kind of hard. So if you leave out Flipkart, it's not as if strategic sales have given a lot of joy to many investors. Although very recently, there has been this company that has been bought out by Byju, right, WhiteHat. And that was, I would say, a good valuation over the time frame in which it got an exit. But these are 2 anomalies.By and large, it takes a long time for people to get a good exit. And very often that exit is the IPO when it happens and for real value to be created. And IPOs typically take 10 years or longer in India. I mean we took 9 years from inception to IPO. We were the fastest. MakeMyTrip took 10 years. I think Justdial took 18 or 20 years, I forget, or Matrimony took 18, 20 years. So it takes a long time.
IndiaMart also took its time.
Yes. IndiaMart, yes, was launched in '96, and it went public -- I think, it went public a year or 2 back. So therefore, you need patient capital in India, okay? If you look at the way we invest, we first went into Policybazaar in 2008. We invested in the first 3 rounds. We invested in 2017 and 2019. So as recently, in 2019, we're still investors after being there for 12 years. And the real value has been created and happened in the last 2, 3, 4 years. Likewise, in Zomato. We invested in 2010. We are still there, okay?In both these companies, we took some money off the table, but that was, by and large, to facilitate other investors coming into the company. So we have patient capital. Our fund reflects that, and we want 1 or 2 other LPs who are equally patient. Because without having patient capital in India, you really can't do early-stage investing and get great exits because it takes time. India is different from the West in that sense. However, if you raise money from LPs who do not want to do 12 plus 2 years, right, who don't have prop money or who don't have the current time horizon, you then perhaps will have to exit prematurely and that will create a challenge for us in terms of returns.
Sure. So that's what brings me to my second question is in terms of the management of the fund, is it going to be managed by a separate team which will be earmarked and a separate management company will be formed?
There's a separate management company. I mean there's a separate AMC, which will manage the fund. But there's -- obviously, the fund is a separate entity in a trust form. The team has been augmented, the investing team. So now there's a team which will look at investments in the areas where you operate businesses, right, and M&A. And that is -- will be a strategic investment team.
That will be outside the fund?
Yes, outside the fund, because that pool of capital is separate. The fund that has been -- the team that has been managing all the other investments so far will continue to manage those investments and will also run the new fund. So the old portfolio will be treated like fund 1 in that sense, in terms of time division; and the new portfolio, the fund will be treated as fund 2 notionally in terms of time commitment. So the same management team will run both.
Okay. Interesting. Interesting. And we are currently in the process of raising some external money from, say, like few LPs?
There are conversations going on, yes.
Okay. And what is the target size for that -- for this fund now?
The target size is same, it's $100 million. I mean INR 750 crores. Never mind what the exchange rate is.
The next question is from Sudheer Guntupalli. He's from Motilal Oswal.
Hitesh, I want to know your thoughts on a couple of aspects. Of the incremental sales or growth happening, especially in segments like Matrimony, what part of it is coming from short-term subscription packages like, let's say, 3-month packages, where some first-time customers may just be moving online and trying out something during the lockdown period, either because off-line options are completely switched off or because people have excess free time in hand? And how do you see the stickiness of these customers going forward as off-line options open up?
See, most of our revenue comes from these short-term packages only because when people buy, they buy for 3 months. And then if they're happy, they'll renew it for another 3 months; sometimes, for 6 months. So our average ticket sizes are in that ballpark only. So we haven't seen any major change in that because of COVID or because of people being in lockdown. Will this revenue -- will this go disappear once off-line options are open? I don't think so because, see, the truth -- we are getting this growth because we are advertising a lot more. What was also -- what also happened in Q1 was that TRPs actually went up for the most programs on television since people were locked in. Advertising rates were also lower. So -- and I think, in general, people had more time. So they were searching -- they had time to search.So going forward, we are already sort of -- like I said, we are already -- we've already decided to up our sort of ad spend in Matrimony and that should result in more sort of profile acquisition. And once we acquire more profiles, it's only -- and then you know it's a freemium model, then a certain percentage of them will convert into paid customers over a period of time. That's how it works.
Got it. And the other thing is the comeback we are talking about in the job market, right? What part of this comeback will you actually take at the face value? Because if we remember even after demonetization, the job market ex of IT companies bounced back in the immediate quarters, but the resultant deceleration panned out much later over several quarters. So in July and August, while the recruitment segment would have bounced back for, let's say, near-term concerns around supply mismatch, so on and so forth, do you expect the actual impact to play out on a back-ended basis?
Actually, I don't know the answer to that question. A lot, I guess, will depend on what happens to GDP growth in the coming quarters. So you only saw minus 24%. Now if Q1 turns out to be a minus 6%, minus 7% quarter, then it's sort of very different. On the other hand if Q2, sorry, also turns out to be a minus 20%, minus 15% quarter, then who knows. So I think a lot will depend on how fast GDP comes back. If you see a V-shaped recovery, hiring will bounce back quickly. On the other hand, if the market or the economy takes a long time to go back to where it was last year, then recovery would be slow.
The next question is from Deepak Mehta. He is from MetLife.
My question is that how tough is the competition from LinkedIn Learning, as I have seen that many of the MNCs are opting for LinkedIn? And is there any plan to tie-up or acquire any learning option which can complement our Naukri business where we can map skill and there's some learning and this kind of model?
See, there's been no sort of major change in the competition from LinkedIn. It is like it was a year ago, 2 year ago. In fact, we've acquired iimjobs so that's given us a play in the premium segment, at least on the MBA side. We're also investing more behind the high-risk brand, which is owned by iimjobs, which is more a tech sort of premium tech brand. So let's see how that plays out. We are hoping to use -- we were hoping actually to use our large Naukri sort of distribution, the fact that we work with 80,000 customers to take iimjobs to many of them. And we actually did a great job in Q4, but unfortunately, we got hit by COVID in Q1. So -- but once sort of -- once the market bounces back, we should be able to take the iimjobs offering to more customers in our stable. So let's see how that plays out. So -- sorry, what was the other question?
So other question is about learning. So are we planning to tie up or acquire any learning to complement our Naukri business, sir?
So we are not looking -- right. So what we are not looking to do is create our own content or acquire content. But what we are certainly looking to do is aggregate courses, online programs and courses, and recommend them to job seekers basis what we think makes sense for them and basis what we think is the requirement of the job market and the skill gap in their CV. So we certainly are looking to use our data and the insights we have on the job market and the sort of job career ecosystem to recommend the right courses to job seekers to help them upgrade their skills. But we are not looking to create content ourselves right now.
The next question is from Vivekanand Subbaraman from AMBIT.
My question is on the investments planned in matchmaking. So why are we so gung-ho about the opportunity in matchmaking? Why not spend more money on 99acres either by way of brand X or expansion of presence in small towns, given that there is a lot of traffic from these markets?So Hitesh, if you could just give some more color on the priority of our investments and how we think about 99acres versus Matrimony?
No. So it's not an either/or for us. The way we are set up inside the company is that we have business units. Each business unit is run by a business head. Each business has a separate product team, a separate tech team, a separate sales team and so on. And each business draws of its own business plan, given the business realities in that space.As far as cash is concerned, we have enough money in the bank to be able to sort of bankroll both the 99acres and Jeevansathi. So -- and we are investing behind both. And it's -- so we are going -- we are certainly looking to expand 99acres to Tier 2 cities, Tier 3 cities. There's already a team working on it. We are making improvements to our platform on a daily basis. We've sort of -- we've -- we started as a new -- as a resale platform. We then got into new homes. We build a rental piece. We're looking to see how we can improve our commercial section on the platform as well. So we don't think 99acres at this point in time requires a lot of ad spend. But if required, we will sort of push the pedal on our advertising as well. See, in 99acres, we are at least a leader. We may not be a dominant player like we are in Naukri, but we are a market leader.In Matrimony, because we are not a clear leader, we are not the #1 player in the market, we're not even #2. Only in the North and West are we #2. There is a requirement to invest more. And the strategy that we've been following in Matrimony has been working well for us. So we've been gaining share. We've been growing faster than the market and so on and so forth. So we just want to sort of push the pedal on this and do a little more of what we've been doing already. So for us, it's not an either/or. And clearly, yes, of course, from a priority standpoint, 99acres is higher priority because it's our second large business and we see a great opportunity in it in the long run. And our market position is also superior to the market position we have been mentioning. But we believe we can do both.
Sure. Understood, Hitesh. Just one small follow-up there. So we see that the gap between you and the #2 player, both in terms of the traffic share, including the app or excluding the app, that has actually gone down. In the sense, the gap between us and the #2 player has gone down. And even in Google trends, if we look at the brand versus, say, the #2 player in some cities, they are ahead. So would it not make sense to spend more money on, say, performance marketing and brand advertising so that we are able to sustain the lead? And I'm just trying to understand why this doesn't concern you?
Can I contribute, Hitesh?
Yes, please. I'll answer it as well, but you can go ahead.
Yes. Yes. So Vivek, it's like this. The 2 are not mutually exclusive. You can invest in Matrimony and real estate. I think what Hitesh and the business of 99acres believe is that perhaps this is not the most optimal time to invest in that because the market is currently down, has been down for a while. And as the market comes back, I suspect, you may see us investing up, but I'll let Hitesh answer that question. This is just my view.
No, Sanjeev, you're right. See, I'll tell you. See, not every business can be built by just investing in marketing. See, the nature of the Jeevansathi business is such that we need more profiles to counter competition because we are a #2, #3 player in most cities. And that's where we believe -- and that's the investment we think will work -- will make the most sense for that business. It also crowds out competition. Our competition may not be in a position to react to our increased ad spends because given their sort of financial position. So that's the strategy which we think makes sense for Jeevansathi to pursue.In the case of 99acres, we don't believe at this point in time that by investing more in marketing, we can gain more share, right? We believe that we need to do a lot more sort of work on many other fronts, if you have to build a sustainable sort of lead over competition. Now, I don't want to talk about everything here, but there are sort of many other areas where we want to invest. We want to work on the platform a little more. We want to improve our data quality. We want to improve the analytics we provide to our users. We want to improve our algorithms. We want to improve our user experience in the mobile app a lot more. So there are a bunch of other things that we want to do in 99acres, which, unfortunately, cannot be done by just spending money. We need to get people. We need to build teams. We need to sort of let them do their stuff. And then hopefully, results will follow.Now once we get to a level where we think we've got a sort of good platform, we've got an edge over competition, and at that point in time, we may supplement and complement it with even more aggressive marketing. So I'm not ruling out marketing spend, going -- more marketing spend going forward, but we believe that we need to invest in many other areas in 99acres if you want to move the needle on our traffic share and our market share in the long run.Short-term traffic share, market share, I would not worry about too much. But that's also often a function of how much you spend in that quarter versus your competition. And that's sort of -- those 2, 3, 4 points which you lose in a quarter, you can gain back very quickly the next quarter if we just pump up the advertising a little bit. But we would not worry too much about that.
The last question is from Utkarsh Solapurwala. He's from Damos Capital.
Yes, sir. Can you give more insight on the performance of other key investor companies like Happily Unmarried, Gramophone, ShopKirana and ShoeKonnect?
Yes. So ShoeKonnect was badly hit by the lockdown for 2 months because it's a nonessential product. So roughly 2 months, they were shut, more or less, which is April and May, right, starting last week of March, actually. But since then, they have bounced back nicely on 2 fronts. One is business has come back. It's not fully back to pre-COVID levels, but it is very substantially back. And second, they managed to raise capital from external investor giving us validation. And these are blue-chip marquee names. And now it's sufficiently capitalized and continues to grow, okay?And Gramophone is -- again, is essential because it's agri input e-commerce, but even essential commodities were disrupted for a few days. And Gramophone was disrupted for a few days, but has bounced back nicely again on this front, and it should be all right, but we're waiting and watching, right?Ustraa, again, was badly hit because it was deemed nonessential. And then when sanitizers were deemed to be essential, they got back into sanitizers. But then eventually, in June, they launched again. It is substantially back but not fully back to pre-COVID levels. And we have raised money from the external third-party, and that's good news because it gives us external validation.As far as ShopKirana is concerned, they were impacted for a week or 10 days, maybe 2 weeks, but now they are back to pre-COVID and higher levels, and they're doing all right. So all of these companies so far are doing all right.
And the last is the -- you invested in edtech company called Coding Ninjas, that must do well in the COVID situation?
Yes. So Hitesh, you want to talk about Coding Ninjas?
Yes. Yes. So we just invested in Coding Ninjas. It's only been a few months. So it's a very small company. See, they have a coding business where they teach sort of coding. That business is doing well. They were also trying to venture into another sort of vertical that's sort of, again, in the coding space, but with a different business model. That got impacted because of COVID. But now that the situation is getting better, I'm sure they'd sort of again experiment in that area. Very early days for us. We just invested a few months back.
So that was the last question we had for today. Over to you, Vivek.
Thank you. Sure. Ladies and gentlemen, due to bad network today, you might have missed a few parts of management response to your questions. Kindly read our transcript for more clarity on your responses. With this, I would like to hand over to Mr. Hitesh for his closing comments.
Thank you, guys. Thank you for taking time out for this call. And have a great evening and, of course, say stay safe.
Thank you. Bye-bye.
Bye.
Thank you.