IndiaMART InterMESH Ltd (NSE: INDIAMART) Q3 2025 Earnings Call dated Jan. 21, 2025
Corporate Participants:
Avijit Vikram — Head of Investor Relations
Dinesh Chandra Agarwal — Managing Director & Chief Executive Officer
Brijesh Kumar Agrawal — Whole-Time Director
Jitin Diwan — Chief Financial Officer
Prateek Chandra — Chief Strategy Officer
Analysts:
Abhishek Bhandari — Analyst
Nikhil Choudhary — Analyst
Swapnil Potdukhe — Analyst
Anmol Garg — Analyst
Amit Chandra — Analyst
Rahul Jain — Analyst
Presentation:
Avijit Vikram — Head of Investor Relations
Good evening, ladies and gentlemen. I am Avijit Vikram, Head of Investor Relations. On behalf of IndiaMART International Limited, I welcome you all to the company’s quarter three FY 2025 Earnings Webinar. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Joining us today from the management side, we have Mr. Dinesh Agarwal, Chief Executive Officer; Mr. Agrawal, Whole-Time Director; Mr. Diwan, Chief Financial Officer; and Mr. Chandra, Chief Strategy Officer.
Before we begin, 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 refer to Slide number three of the earnings presentation for the detailed disclaimer.
Now I would like to hand over the call to Mr. Dinesh Agarwal for his opening remarks.
Dinesh Chandra Agarwal — Managing Director & Chief Executive Officer
Thank you, and over to you, sir. Good evening, everybody, and welcome to IndiaMART’s quarter three FY ’25 earnings Webinar. We have circulated our earnings presentation, which is available on our website as well as on the website of the stock exchanges. We assure you would have gone through the same and we would be happy to take any questions afterwards. IndiaMART has delivered consolidated revenue from operations of INR354 crores in-quarter three, representing a year-on-year growth of 16%.
Collections from customers grew by about 10% to INR363 crores on consolidated basis. Deferred revenue grew by 17% to INR1,492 crores on consolidated basis. Unique business inquiries have grown to INR27 million, representing a year-on-year growth of about 17%. Total number of paying suppliers has declined slightly by 3,500 to 214,000. This decrease is primarily attributed to the reduction in gross supplier addition during the quarter as we have take — been increasingly focusing on onboarding higher-quality businesses as paying supplier.
Additionally, lesser number of working days due to festive season has also contributed to the decline. The churn rates within the customer-base in the silver decades remain largely consistent with the trends observed in the recent quarter. Our platinum and gold customers, which constitute approximately 50% of our customer-base and 75% of revenue continue to have low churn. We are focusing on enhancing quality and simplifying the platform to improve the user or overall user experience and engagement. We have further strengthened our leadership by onboarding Mr. Saurab Deep Singla’s new Chief HRO.
Now I will hand over the call to update about Busine Footage. Thank you, and over to you, Brijesh.
Brijesh Kumar Agrawal — Whole-Time Director
Hi, good evening, everyone. Has done a net billing of INR20.4 crores in the quarter and this represents a Y-o-Y growth of about 42%. This billing also includes an impact of approximately INR2 crores, which has come in because of a change in the overall payout structure for the channel partners. The revenue from operations have grown by 30% year-on-year basis to INR16.3 crores. And the deferred revenue has grown by 43% to INR57.3 crores. The EBITDA for the quarter is at INR1.1 crores. This is a margin of 7% and the net profit was INR1.9 crores. The cash flows from operations stood at INR4.9 crores. During this quarter, we’ve sold an additional 7,000 new licenses and this takes our total licenses sold-out to about 388,000 overall licenses at the end of December ’24.
With this, I’ll hand over the call to so that he can the financial results.
Jitin Diwan — Chief Financial Officer
Thank you, Brijesh. Good evening, everyone. I’ll take you through the financial performance for the quarter-ending December 2024. Consolidated collection from customers was INR363 crores in the quarter, representing year-on-year growth of 10%. IndiaMART standalone collections from customers for the quarter were at INR341 crore, registering Y-on-Y growth of 8%. Standalone revenue from operations stood at INR337 crore, registering Y-on-Y growth of 16%. Our growth in revenue was primarily driven by improvement in realization from paying — suppliers.
Consolidated deferred revenue stood at INR1,492 crores, increase of about 17% on Y-on-Y basis. EBITDA of IndiaWar standalone business stood at about INR144 crores, representing a margin of 43%. The margins continue to be elevated on account of savings arising from lower subscriber acquisitions and operating leverage. As and when customer growth increases in future, we anticipate the margins will align with the gradual operating leverage. Consolidated net profit for the quarter was at INR121 crores. Consolidated cash generated from operations was at INR114 crores. Consolidated cash and treasury balance stood at INR2,606 crores as of 31st December 2024. During the quarter, we exited one of our investing company as it was fully acquired by UniCommerce listed on stock exchanges. Thank you very much. We are now ready to take any questions.
Questions and Answers:
Operator
We will now begin the Q&A session. If you wish to ask a question to the panelists, kindly raise your hand and allow camera and my question access. Alternatively, you may type your question in the chat menu and we will revert on it. Please restrict to two questions so that we may be able to address questions from all the participants we will wait for a couple of seconds while the question queue assembles. First question is from the line of Abhishek Bandari from Nomura. Hi, Abhishek, please go-ahead with your question.
Abhishek Bhandari
Yeah. Thank you for the opportunity. Sir, I just had this question on surprise subscriber — paying subscriber number minus 3.7%. No, even in the worst of the last few quarters, you were at a positive number of around 2,000 odd. So what surprised you negatively? And do you think by when do you think we’ll again go back to a positive number, if at all and sustaining this collection growth rate in double-digit, is it possible sense the net subscriber addition for you?
Dinesh Chandra Agarwal
Thank you, Abhishek. See, last quarter also, I mean, I’ve been guiding in the last two quarters or that while we are working on improving the churn and for the purpose of improving the churn, we have taken two, three initiatives. One which you can see is the number of inquiries, unique inquiries to the number of inquiries delivered, that ratio has come down from 5.5% to now 4%. Secondly, we are trying to improve the relevancy in terms of geographical matchmaking and in terms of by lead or RFQ quality. So those things that we are taking and they are taking much longer than our anticipation.
So we are in the meantime, what we are doing is not aggressively investing in gross addition, rather we are doing segment-by-segment analysis, which are the customers, which are the high churn customers for WIM for whom — which kind of customers the platform is not working at all. And we are trying to identify those segments one-by-one, whether it is the Tier-3, Tier-4 geographies or whether it is some of the industries, where it is not working and we are trying to restrict our investment until we are able to get a very positive hang on churn because there’s no point trying to get one or 2,000 customer addition per quarter or whether it is 1,000 or 2,000 less.
So if you go to our functional P&L side, you will see that investment in sales and marketing, which used to be typically at about 15-odd percent or 50 plus-minus that ranges between 12% to 18% is at the lower side of the thing. Now we are at 13% only. So we are consciously not investing — going aggressively to increase the number of supplier base.
We know we have supplier base. We are getting certain supplier base and two, there may be some seasonal effect of the Shera Diwali Christmas New Year. But other than that, I think let’s wait for a quarter or two when I can give you a really good news about the churn and then we can — we have all the money and all the resources to go back and press the on the new customer acquisition.
Abhishek Bhandari
Yeah. And so, my question on whether you can sustain this double-digit customer collection growth in the fact that addition has come negative.
Dinesh Chandra Agarwal
Right question because if we are not doing the gross addition, so even if those customers were staying for let’s say, three months, six months, nine months, they were adding to the collection. So this particular thing that if the net customer addition is going to be even zero or plus/minus, then whether the collection will remain in the 5% to 10% range or whether it will remain in the 10% to 15% range. You are right. I think let us not have an expectation of over 10% as of now. If we can surprise you, we’ll come back, but I’m — I would not increase my expectation beyond 10%.
Abhishek Bhandari
Okay. Thank you, sir and all the best.
Avijit Vikram
Thank you, Abhishek.
Operator
Next question is from the line of Nikhil Choudhary from Nuvama. Hi, Nikhil, please go-ahead with your question.
Nikhil Choudhary
Hello, good evening, sir. Thanks for the opportunity. My question is on collection growth remaining below 10%. Last quarter we highlighted there were some execution challenges, right? And that basically impacted your collection growth last-time, but still collection growth remained below 10% and you are also guiding less than 10%. So just wanted to get some color on what’s happening and is the impact of execution challenge continue to remain?
Dinesh Chandra Agarwal
Yeah. So I mean, last quarter suddenly we came down from that 14-odd percent to-4 odd percent or hyper percent and there were two things. One is that the number of customer addition was not happening. So we were slowly and slowly coming down in our collection growth coming from 20% to 15%, 16% to 14%, 13%. And so, I think we would have been happier if we — last quarter was 12-odd percent, but we actually fell down to 4%. So there were some execution challenges. I think there is always an execution challenge. But by and large, I think I — the team has done a good job with 8%, 9%.
And mostly if you see the ARPU growth or the collection per customer growth, the team has been able to do a decently good job. So I would not say that the collection is now reflecting a bad execution. So 1%, 2% plus, minus here and there possible. But I — because we have not been adding customers, so there is a problem with the collection and that is why I’m saying that let us wait for a quarter or two more when we can give you a better color on the churn.
Nikhil Choudhary
Sure, sir. Second one, just want to understand your thinking behind it. So we have been trying to improve or reduce the churn basically during the last five to six quarters, right? We have made various initiatives, including changing the match making, enabling oral easier contact between the seller, plugging WhatsApp is now available on your website in your app. So just want to understand despite so much initiative, if we are seeing the elevated churn continue to remain a problem, why don’t we fundamentally think that elevated churn is now maybe a base-case and we should focus on gross addition rather than cutting our sales and marketing, which is impacting our growth further.
Dinesh Chandra Agarwal
I mean, that would — that would — that can only help you in maybe one or two more quarters, but after that, again, it will come back and bite you. So there is a — there is a concept of CAC to LTV of the customer acquisition cost that we should pay long-term value that we can drive. And while it is highly profitable for us for the second year, third year, fourth year customers, for the first year customers, if the retention are going to be so low, I think know it will — it will become a problem in time to come. So I think it is better that we connect our main engine right now and be able to do a better job. Otherwise the — we will get into the pure ARPU growth mode for many, many years.
I think it will take some time. I am still not pessimistic on the India growth story or Internet growth story or legion story or any of that, that is what I suggested, I think last to last quarter in one of the questions that let us not yet question the business model of Google itself, because if the Google as a business model is a purely, purely advertising lead-gen business model for SMEs and for businesses. I think IndiaMART is slightly more refined version of that with a slightly lesser TAM. So I’m still confident that structurally there is a whole lot opportunity available in front of us.
We are trying to find that blind-spot, which we can fix doing too many different experiments. Yes, you are right that it has taken five, six quarters and nothing has resulted so-far. But I think we have done it time and again in the past many, many years over the last two, three decades, I think we will be able to fix this. If we are not able to fix this two, three, four quarters, I think we can always go back to the ARPU-led growth or customer acquisition-led growth at a lower profitability.
Nikhil Choudhary
Sure, sir. Makes sense. The last one, if I can squeeze in, is on your buyer side. So we have seen decent improvement in metrics, both on LTM active buyer as well as unique — unique business inquiry, right? Any color, any initiative you have taken which is resulting that and just some color out there.
Dinesh Chandra Agarwal
I think this is a function of too many things, whether lesser number of supplier causing lesser irritation to the buyer because at the end-of-the day, we sell buyer information to the sellers and multiple sellers do call you. So has that resulted into a significant repeat buyer? You can see a little bit of improvement in repeat buyer coming to at about 55% highest-ever kind. But that’s just 1/4. Some improvement is possibly the search engine optimization because the last year, most of the searches were driven from the Google desktop and now Google has become mobile-first indexing.
So — but I would still say let’s wait for another quarter when this can become a sustainable trend because these are the only two quarters of good growth. I would still wait for another quarter to say that this is a sustainable trend. Sure, sir. Thanks running at almost all-time high unique business inquiries per quarter.
Nikhil Choudhary
Yes, sir. Thanks, again and good luck for coming.
Avijit Vikram
Thank you, Nikhil.
Operator
Next question is from the line of Swapnil from JM Financial. Hi, Swapnil, please go-ahead with your question.
Swapnil Potdukhe
Hi, thanks for the opportunity. So I have two questions. The first one is, see, we have been seeing this churn related issues since the time we increased our pricing on the silver category, right, the last year, sometime in May. And that is when we have been seeing this kind of a high churn rates, especially in the silver category under a sustained. Have we considered going back to a previous pricing, you know, trying out something different rather than just saying, you know that this is low-margin growth and you know and it may not get converted into upsells going ahead. But just for the time-being, just going back and to the previous pricing and-or just to bring something new to the table rather than I’m just coming from that thought process, if you can just…
Dinesh Chandra Agarwal
Yeah. I think it’s a valid suggestion now because while the price was — price is same as what 2019, ’20, just before the COVID, we had price. And so there was no rationale to even think while the inflation has run-up so heavily in these many years that INR500 per month would have such an impact. But given that you know, it’s been five, six quarters. If another two, 3/4 that doesn’t change, we will definitely look at your suggestions. And I think we internally also keep debating on this.
I think I’m still hopeful that we should be able to find the real reason of it rather than the INR500 reason because gross addition has not been slowed — has been slowed only in the last three, four quarters, not in the first two, 3/4 as per price. It was only for that 1/4 glitch, otherwise the gross addition that I see my own number internally and if you go back to again functional P&L, the sales and marketing for the entire year of FY ’24, it was 18%.
And then if you look at the quarter-on-quarter that number, it has slowly and slowly come down. So we are meaningfully not in — not really investing heavily on-going after the market. And there are opportunities which if I want to acquire a customer at INR2,000. But at the end-of-the day, if I’m not able to retain the customers and upset this customers, it will slowly and slowly become a deteriorating business. Okay. So give us another two quarters, if not, then we will see.
Swapnil Potdukhe
Okay. The second question is with respect to your categories which are getting impacted in a meaningful way. Now there has been, you know some spending related slowdown, especially government spends not increasing in a meaningful way. Are there any specific categories that are getting impacted and a part of the problem could be this macro challenges rather than just on the churn side. I mean just trying to extrapolate a few things. Plus, sorry, just to conclude that point.
And if, yes, if that is the thing, have you started working on the thought process from a vertical perspective, right, you know, focusing on certain categories where opportunities can be big opportunistic can be big even today, right, despite the kind of penetration could have happened and rather focus on those categories far more than those categories where chances of incremental supplier growth could be lower. Have you thought on those lines also?
Dinesh Chandra Agarwal
Yes, sir. So on the macro side, I continue to say that every — every quarter or so, there are some of the other macro challenges in some of the other categories or geographies. So for example, sometimes there is a ban on single-use plastics and plastic — I mean, plastic is a huge industry. Packaging is a huge industry, but it evolves into something newer product like you know, green products and all that. Sometimes, I mean, there is a construction ban past two, three months that has been bad for NCR, but so I think there are always macros — small, small segments of macro negatives, whether it is statewise or whether it is industry-wise.
The good part about IndiaMART or any large horizontal diversified business like IndiaMART is that while there are always 1% or 2% headwinds, there are some tailwinds also available in some of the other sectors. So — and coming to your second question, yes, I think it is very imperative for us that we should start thinking about our business also now as verticals within horizontal and be able to cultivate certain verticals much more speedily or much more profitably. We have done that in past. I remember apparel and handicraft used to be the first few verticals when we were doing export-related business.
When we came to domestic business, I think the engineering goods was one of the very, very important business. As the advent of e-commerce happened, packaging material became very, very big. Similarly, now pharmaceutical and healthcare became very, very big. So I think there are at least top-10 industries where we can choose to go double down on vertical wise and find growth. We are working on that. We have start — as I said, we have started to invest a lot more on category-specific insights than a couple of years ago. And I think we will come back with the more — more solid options on that soon.
Swapnil Potdukhe
Okay. Just to get that point a bit more. Have you started hiring a specific vertical focus of employees and who can better give you a extract value for you within certain categories? I mean, is that the thought process?
Dinesh Chandra Agarwal
Yes, it is the thought process. We have — we will start to hire a couple of industry-specific people to focus on that vertical. We currently we have in-house category management people and we have a large team working on that. But you are right, now we should be looking more at industry insider experts.
Swapnil Potdukhe
Got it, sir. Okay. So those were the questions. Thanks a lot for taking. Thanks.
Operator
Thank you. Next question is from the line of Anmol Garg from DAM Capital. Hi, Anmol, please go-ahead with your question.
Anmol Garg
Yeah, hi. Thanks for the opportunity. Couple of things from my end. Firstly, if you can indicate that are we planning to change anything in our customer acquisition strategy? And what do you think is not working? Is it the channel partners or the customer acquisitions through our own employees? If you can shed a bit of light on that?
Dinesh Chandra Agarwal
Equally, I think when in the beginning of the year, beginning of the last year, I think we first cut-down on our Telly based Tier-4 centers. So I think that was the first thing that we did in January, December last year, I mean 2023 and January 2024. And then wherever we operate field sales force, I think we started to look at the cost of customer acquisition very closely and we found that there were certain geographies as well as the certain places.
I mean, I can give you an example, if you go to Surat and you want to buy an subscription, you will not be able to buy it in the monthly mode, the only-mode available because it is found that apparel is a while add it is one of the large industry. It has that look and feel and high churn in nature. Similarly, Jaipur has a handicraft place has a very similar so we have taken you individual steps to reduce the investment in where it was getting wasted completely. While focusing on categories or while focusing on segment of suppliers, which are better useful.
So for example, the — we are trying to find how can we create a specific channel, which can work on maybe INR1.5 crore-plus turnover companies because that is where we see a better retention than less than INR40 lakh or less than six months or less than one year GST registration because lot of these new businesses who come — who get registered and want to try Internet for their own growth, their natural churn is the unnecessary high, which end-up creating a badmouth for us also.
So I think we are — but those execution challenges set apart, I would say if I can fix the basic matchmaking and the basic buyer supplier thing where a buyer starts to increase systematically again and thereby impacting better — even better retention for our gold and platinum customers, then I think the silver will automatically fall in-place. So we tried fixing silver training and onboarding and those things which are anyway we should be doing.
And I think Dinesh and his team is doing fantastic job on that side. But there are certain blind spots that must be there in the product that we are not able to find because I’m pretty fully convinced about the overall opportunity size. The overall opportunity is massive. Customers want to give you money and we need to fix the large multi-geography, multi-industry engine, I think we should be able to fix that. So give us one or two more quarters on that.
Anmol Garg
Right. And just on the continuation of the same, are we also planning somewhere to change the payout structures for our channel partners or for our sales employees who are bringing in more quality-based customers to us where the churn might be lower for those particular customers.
Dinesh Chandra Agarwal
We keep doing minor, minor changes on the incentive policies. And as I said, where we have to promote annual acquisition, we incentivize annual acquisition, wherever we have to promote any particular segment of — so we do incentivize for disincentivization purpose, we have a control in our own hand where we do not assign those leads. So we — a lot of these things we can do centrally as well for the purpose of incentivization, we do and we continue to tweak them day-in, day-out. So don’t worry on that side, we will do enough experiments. I think let us first fix the basic nature of and then come back on that again.
Anmol Garg
All right. Secondly, wanted to understand if we intend to acquire majority stake in any of the investee companies. The basis of this question is just wanted to understand if we are also looking to enter full fledgedly into any of the newer businesses which we have acquired or in associated manner.
Dinesh Chandra Agarwal
So if you look at the accounting as a segment, we started Livekeeping with 51%. Currently, we have 66%. I think as per our agreements, we will end-up doing 100% acquisition of that. On also, we started from 26% right now, we are about 29% there. Busy we have already taken 100%. So on the accounting side, we are fully committed and in the first three years of busy, we have been able to increase the growth rate as well as retain every customer, nothing has gone wrong on that side. So I think this side is well sorted. Now coming to the second side, which has the minority investments into various things. Couple of companies we have, I think increased our estate. Prateek, can you give more details.
Prateek Chandra
Sure. So look, all these investments have been done in the spaces which are strategic for us because our going-in thesis is that we should be able to get some kind of in synergies either in the near-term or in the longer-term while making the investments. So if you see, for example, when we started — we started with a 10% stake, now we own roughly around 31.3% stake here. Similarly, superprocure, we started with roughly around 26%, now we have a 35% stake here. Easy e-comm is another one which we started with 26%, we’ve put in some other cash-in the convertible position. So we’ll come to know as to what the stakes would be, but there are follow-ons that we have done in our industry companies wherever the opportunity has arisen.
So to answer your question, we are okay increasing our stakes in the investor companies because these are the strategic spaces. However, you know whether to take majority, we are very patient investor and we’ll wait for the right opportunity to decide as to whether we need to take majority or we don’t need to take majority there. But as and when the opportunity comes, we will continue backing these companies in the further rounds.
Anmol Garg
Understood. Understood. And just one last thing from my end is, are we somewhere planning to enter into the e-commerce — B2B e-commerce business as well. And are we seeing any kind of competition from that particular set of companies right now?
Dinesh Chandra Agarwal
We are already into B2B commerce. If you look at industry buying, industry buying is and also industry buying and Procmart, both of them are purely what you want. What is the normal media parallelance B2B commerce is called, Propmart is more like a wholesale B2B commerce and industry buying is more like a SME or corporate MRO kind of B2B commerce. So we have invested in both. However, if we look at the profitability of any of them, looks quite elusive as of now.
So while we have been investing on B2B commerce since 2014, from ’14 to ’17, we were invested into Lexo and then again in 2021 or so we invested by between 2016 and ’20, we invested in Propmart, but — and Brockmart has done handsomely well. So we continue to be looking for any of these. Anything which is good enough and has a better unit economics, we would be looking at. Nothing to say any competition has come back and you know, hurt any of our customers or any of our people. So I think, in fact, whatever noise was there, it was there between 2021 and 2022 is no longer even there. So none of the competition.
Anmol Garg
Sure. Thanks. Thank you so much, sir. These were my questions.
Avijit Vikram
So we have a question from the chat box. The question is from Mr. Yassir. Considering the fact that we generate operating cash flows of INR500 crore-plus and that we have a robust balance sheet. What are your thoughts on buying back stock.
Dinesh Chandra Agarwal
So I think this year — this financial year-around August, September, we had returned about INR120 crores back to the shareholders. And we have also done about INR84 crores of strategic investment in these nine months. So — and if you look at the historical number, we have been able to return either money to the shareholders or doing strategic investments.
So as the time will come and as the Board will decide, we try to do it once in a year, not multiple times in a year. So after the financial year-ends, whenever the Board meeting happens at the — before the AGM. We will decide how much to distribute back to the shareholders or how much to invest in the strategic investment.
Operator
Thank you. Next question is from the line of Amit Chandra from HDFC Securities. Hi, Amit, please go-ahead with your question.
Amit Chandra
Sir, and thanks for the opportunity. Am I audible?
Avijit Vikram
Yes. Yes, Amit. Please go-ahead.
Amit Chandra
Yeah. So sir, in terms of the trend that we’re seeing in terms of the diversion trend, in terms of the pressure that you’re seeing on the suppliers and the increase in the ARPU, that actually suggests very simple terms I’m trying to understand that suggests that the lower-end of the pyramid is not able to derive value from the platform, whereas the higher-end or the top payings or suppliers are able to around like are able to derive much better value from the platform and the ARPU is increasing is like suggesting that.
And also, people are moving from like lower plan to higher plan. So what explains this divergence? And is it going to continue in this manner for a while? Obviously, you have explained it in like different form, but not just from the relevance of the platform for the lower-end, is it you need some kind of more innovation there or the platform has to be — in terms of offerings has to be like reconsidered in terms of what we are offering to the lower-end.
Dinesh Chandra Agarwal
Thank you very much I think very important question. So there are 3, 4 kinds of suppliers that use IndiaMART okay one who are very highly native digital savvy kind of customers and they are able to find value because they are investing not only money, but they are also investing enough time on the IndiaMART app or on the IndiaMART seller panel and they are digitally more savvier and invest a lot of time.
The second kind of customers are those who themselves have not found their own business model or have started a new business or recently trying to scale, have taken because a lot of our customers have seen have come for less than one year GST registration, I mean, who have recently got their GST number registered.
And the third — third ones are those who have understood the value of initially being digitally savvy or they have found few and they have invested one or two persons who properly deal with the IndiaMART leads and IndiaMART system and are able to do a daily weekly monitoring of those people. So these are the people who invest high.
And the fourth kind of customers are those who are newer, which are the large market, large offline market who is looking for a digital easy digital option. While at IndiaMART, we started at a very smaller, simple system, over the time I think we have gone more sophisticated or complex for that a new genuine customer who is one to five years in business, who are one to 50 years in business has a good online business and trying to go digital, but is not digitally savvy. For him, I think it is difficult and we have to make it easier and more foolproof for him to be able to succeed.
I think that is where the bigger opportunities and if we are able to handle these two separately, how to serve the golden platinum by acquiring a — see golden platinum bring you a lot of spillover effect because they are the ambassadors that in every market, in every, a few of those guys make a lot of money through and their word-of-mouth actually spreads down, which helps us acquire a lot of these newer customers. So I think the middle fact we have to fix. And we are working on that. Let us not assume that we will not be able to fix that.
Amit Chandra
Okay. And so lastly on the collections. Obviously, we had though the collections better than what we did last quarter, but considering 4Q is the most important quarter for us in terms of collections. So how is the progress for 4Q because if I take at least 10% Y-o-Y growth also for 4Q, then also we are hitting say 9% to 10% growth for the full-year, okay. So the full-year growth — the full-year — the collections growth is still like muted because like what happened in the first-half. So still the ask rate for that is still high for the 4th-quarter. So what I know like what you would like to suggest, what is happening like till now and what kind of collections we can see for the 4th-quarter?
Dinesh Chandra Agarwal
No, I mean if you go to the net customer addition slide, I think customer growth has been slower for almost six quarters now, six, seven quarters and that is resulting into a slower collection growth until we are able to fix that, I don’t think we should expect anything miraculous on the — so whether it remains 8%, whether it remains 10%, 12%, I would say any of that is maybe a hard work or extra work that we might do, but we have to fix the churn and then we have to start acquiring customers so that we can naturally start to grow collection and thereby revenue. So I would say, please wait for another quarter or two.
Amit Chandra
So let put it simply, so collections of INR500 crores or more in 4th-quarter requires some fix or is it achievable at the current status?
Dinesh Chandra Agarwal
I can’t comment on the specific numbers or the future expect numbers.
Amit Chandra
Okay, sir. Thank you.
Avijit Vikram
So we have another question from the chat box. The question is Mr. Manish Gupta. What percentage of business inquiries are delivered through free suppliers? Any thoughts on whether we can charge small amounts to free suppliers who have stayed on the platform? Or more broadly, are there any other levers of monetization of supplier base?
Dinesh Chandra Agarwal
So if you less than 20% of our total inquiries are delivered to the free suppliers. And why it is only in the absence of paid supplier of that particular category or city, what buyer is looking for is not available. So if I am as a buyer come to the platform and I’m looking for a product from a specific geography and if IndiaMART does not have a paying customer, the buyer doesn’t care whether IndiaMART as a platform makes money or not, they want to get their search fulfilled.
So from the buyer side, IndiaMART is 100% free, just like you go to Google and Google, you expect Google to give you all the answers, whether or not Google makes money from that category or from that geography. Same in the same manner it is for India. Now coming to the monetization of those free suppliers or suppliers in a free manner.
If you go and see on the, there are individual RFQs or by leads that a supplier can purchase which are available for 299 and upwards for each individual leads and if I remember correctly that generates about 34 crore, almost up INR4 crore a year coming into collection and that not only that generates, it also generates a good number of hot leads for those suppliers to get converted into regular paying suppliers and their conversion rates are also much higher for than the hot leads of the suppliers who come and add products versus the one who go and try purchase an RFQ or purchase.
So we already continue to do that. Any more ideas or any more suggestions, I think we will — we are always open to that. But currently, the major problem that we are trying to fix is the fat middle where we should be holding on to the customer. Customer is willing to invest money. This is not a new business. So where all the checkboxes are right checkboxes, the customer is willing, the customer. It’s only that the customer doesn’t have enough time to be able to play fastest finger first. So I mean, so I think there we need to fix.
Operator
Okay. Next question is from the line of Rahul Jain from Dolat Capital. Hi, Rahul, please go-ahead with your question.
Avijit Vikram
Not able to hear you.
Rahul Jain
Hello.
Avijit Vikram
Yeah. Now you are audible.
Rahul Jain
Hello. Yeah. So thanks for the opportunity. I just wanted to understand that, what are the initiatives we are undertaking to ensure that our ARPU improvement trend continues to trend faster than the usual base so that we could mitigate the medium-term challenges from the subscriber add any which way the subscriber adds during a year-one contribute very small portion of the total incremental revenue. So is it possible to mitigate that by ensuring much better outcome from digitally savvy supplier base that we have to get to the aspired growth range.
Dinesh Chandra Agarwal
So ever since, if you see, ever since about two years ago now, we started selling platinum customer-base by way of differential of differential pricing of the category and city, I think we have seen a systematic increase in the ARPU. Currently about 4% or 4,000 of these categories command about 50% premium to the regular customers. And as and when those customers, older customers are coming up for renewal and as the newer customers are being signed-up, that is what is driving the ARPU, if you see?
So I think systematically, for many quarters in the coming month, I think the top 10% ARPU continues to grow rapidly. And that top 10% is now accounting for almost 50% of the revenue, 49% to be precise. So I think this 50% of the revenues poised to grow a rapidly — has been growing rapidly over the last six, eight quarters and will continue to grow for like rapidly over the next six, eight quarters.
On the overall side, I think the ARPU is 13% 14% growth. But the top 10% ARPU has been growing consistently, which is the 50% of the side, I think I’m pretty confident that if we can solve the churn issue and the customer growth issue over the next two, 3/4, I think we will be able to stay clear of any negative growth.
Jitin Diwan
Last four, five quarters, essentially the ARPU growth has been in double-digits.
Dinesh Chandra Agarwal
I mean there is also denominator factor, but in general, the top 10% of the customer side, that denominator factor is not there and the overall ARPU, the denominator factor plays a lot more larger role because of that 3,000 customers. But on the top of the end, top 10% customer is only 21,000 or 22,000 customers. So the denominator factor is not there. The top 10% ARPU is there.
Rahul Jain
Just a slight clarification to the last part of the — your response. So you’re saying, key, if we continue on this path, we can mitigate the situation of a weak revenue performance and there was a — another comment which you made earlier that for time-being 10% a benchmark for collection growth is a good — good number to look at it. So can you just clarify on these two-parts? Thank you.
Dinesh Chandra Agarwal
Yeah. I mean, given the — given the customer growth being either 0% or 1% or 2%, I think all of the growth has to come from ARPU only. And on the ARPU side, if we can — historically, if you see 6% CAGR, recently, if you see 14% CAGR, I don’t think the 14% is a good — good enough — good enough to ask our big — because what you are saying in the ARPU growth is what collection growth we had in the past because the collections flow into the deferred revenue and then it flows into revenue.
So now if the collection growth is about 8% this particular quarter and the supplier growth is 0% or 1% supplier growth. So effectively, the ARPU growth, I mean the average collection per customer growth is only 6%. So I would say that 5% to 10% collection growth per customer expectation is a reasonable expectation. Rest has to-be-built up from the customer growth only.
Rahul Jain
Yeah, right, right. And actually, only one part which we missed is that are we doing anything new? Of course, you said you’ve been doing lot of things there, but is there anything newer initiative that we have taken given that digital adoption in general is much better. So are we seeing that behavior or are we trying to do far better keyword monetization or something like that?
Dinesh Chandra Agarwal
Yeah. I mean, one small thing that I can tell if you — if the broader if it is not too complex for the broader audience. See around 2018, ’19, ’21, ’22, the buyers — we were assuming that the buyer is not very savvy on digital and the mobile was a new device that the buyers have gotten. And our own category-by-category specification definition was also building up and our own understanding that where quantity is important, quantity is not important, which category is there. And we are more like a very, very horizontal platform. During the COVID, we learned few things about categories.
Now I think we have two things have happened. One, the buyers or the visitors of the India market in general are not that novice they at least know-how to operate and how to select options in terms of what is — what is it that they are looking for. So while we had made a lower intent buying much more easier because earlier we were saying that let us capture the intent of the buyer and we will be able to do the qualification or the seller will be able to do qualification.
I think over the last 90 days or so, I think we have gone back to the drawing board and said that why not do the multiple intent confirmation on the buyer — on the mobile website itself or the mobile app itself. And I was happy enough to see that 90% buyers actually completed those journeys and completed 90% of those completed accurately, which was not the case two years down the earlier.
So I think the lead quality that you would — that the suppliers would see, would also increase significantly over the next quarter or so. So this is the new thing that we have done. We have found a gap or as an opportunity that we have fixed. Hopefully, that should be able to fix the — just apart from the competition that we have fixed. So these are the two, three things that we are working on and this is the third thing that we have found in the last 90 days.
Rahul Jain
Sure, sure. That’s quite helpful. Thank you so much. That’s it from my side.
Dinesh Chandra Agarwal
Thank you, Rahul.
Operator
Thank you, ladies and gentlemen. That was the last question for today. I now hand the conference over to Mr. Dinesh Agarwal for closing comments. Over to you, sir.
Dinesh Chandra Agarwal
Okay. Sorry. Thank you, ladies and gentlemen for joining our Q3 FY ’25 conference call. And thanks for being so patient and investor. We have tried to address all your queries in the time available. But if you still have any questions, please feel free-to connect with our Investor Relationship and they will be more than happy to answer you one-on-one or publish your questions on the website. Thank you. Thank you very much.
Operator
Thank you, everyone. On behalf of IndiaMART, we now conclude this webinar. Thank you for joining us. You may now disconnect your lines. Thank you.