Info Edge (India) Limited (NAUKRI) Q2 FY23 Earnings Concall Transcript

Info Edge (India) Limited (NSE:NAUKRI) Q2 FY23 Earnings Concall dated Nov. 14, 2022

Corporate Participants:

Hitesh Oberoi — Co-Promoter and Managing Director

Chintan Thakkar — Director & Chief Financial Officer

Sanjeev Bikhchandani — Founder and Executive Vice Chairman

Analysts:

Deep Shah — B&K Securities — Analyst

Unidentified Participant — — Analyst

Vijit Jain — Citigroup — Analyst

Amit Khetan — Laburnum Capital — Analyst

Vimal Gohil — Alchemy Capital — Analyst

Vivekanand S. — Ambit Capital — Analyst

Ruchi Mukhija — Elara Capital — Analyst

Ankur Rudra — JP Morgan — Analyst

Abhishek Bhandari — Nomura — Analyst

Presentation:

Operator

Hi, everyone. Good evening, and welcome to Info Edge India Limited Q2 ’23 Financial Results Conference Call. [Operator Instructions] Please note that this conference is being recorded. Joining us today from management side, we have Mr. Sanjeev Bikhchandani, Founder and Vice-Chairman, Mr. Hitesh Oberoi, Co-Promoter and Managing Director; and Mr. Chintan Thakkar, CFO.

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 some risks and uncertainties. Kindly refer Slide number two of the investor presentations for detailed disclaimer.

Now I would like to hand over the call to Mr. Hitesh Oberoi, for his opening remarks. Thank you, and over to you, Hitesh.

Hitesh Oberoi — Co-Promoter and Managing Director

Thank you Vivek and good evening everyone. Hope you’re all doing well. And welcome once again to our second quarter earnings call. As always, we will start by giving you an update on standalone financials. And we’ll talk about the market conditions in each of our operating verticals and then cover the financials of each business in more detail. And then of course, we’ll have time for Q&A in the end.

The audited financial statements and other schedules on segmental billing, revenues, etc along with the data sheet have been uploaded on our website infoedge.in. Overall billings in Q2 grew to INR542.9 crores, up by 31.4% from Q2 of last year. Billing H1 ’23 stood at INR1,067 crores, an year-on year growth of 45%. Revenue in Q2 stood at INR531.8 crores, up by 46.7% from Q2 of last year. Revenues for H1 ’23 stood at INR1,039.5 crores and year-on year growth of 50.5%. And billing revenues along with acquired businesses like Zwayam and Do Select stood at INR559.5 crores and INR549.5 crores respectively.

Operating expenses for the quarter excluding depreciation and amortization were INR347.8 crores, up by 38.2% from Q2 ’22. And operating EBITDA for the quarter stood at INR184 crores versus INR110.8 crores last year, an increase of 66.1% from Q2 of last year and EBITDA for H1 ’23 stood at INR347 crores. Operating EBITDA margins for the quarter stood at 34.6% compared to 30.6% for the same quarter last year and EBITDA margin for H1 stood at 33.4%. And operating EBITDA including acquired businesses stood at INR189.6 crores, or year-on year increase of 79%.

Cash from operations for the quarter stood at INR299.9 crores compared to INR171 crores last year for same quarter. And the business generated INR383.8 crores of cash from operations in H1 ’23. Deferred sales revenues stood at INR840.9 crores as of September 30, 2022 versus, INR562 crores as of September 30, 2021, an increase of 49.6% year-on year. And the cash balance of Info Edge including the wholly owned subsidiaries stands at INR3,250 crores as of September 30, 2022, as compared to INR3,880 [Phonetic] crores as of September 30, 2021.

The JobSpeak index for the month of September was up 12%, however, hiring slowed down in IT and ITeS segments September onwards. This trend continued in the month of October with a negative growth of 18% in IT and telecom sector, however, in early festive season also impacted the index for the month of October as of close to 3% — down 3% year-on year, however, hiring in Q2 remained upbeat with high growth in non-IT sectors like banking, real estate, insurance, travel, tourism, hospitality, retail etc.

The quarter saw demand for [indecipherable] management profiles getting momentum across industries. We also experienced a vibrant real estate market during the last quarter. Strong momentum in new home sales continued across top cities in Q2. We noticed an upward trend in property prices. We expect the unit sales momentum to continue in near-term despite the hikes in home loan interest rates announced recently. We also expect builder clients to launch more new residential projects in the second half of the current financial year.

University and college admissions are little [indecipherable] this year. We expect the academic season to return to normal from next year.

Moving on to our financials for the recruitment business. In Q2 of ’23, the recruitment segment billings were INR425.6 crores, up 41% from Q2 of ’22 while revenues were INR418.1 crores, up 56.4% from Q2 of 2022. Billing for H1 ’23 stood at INR840.6 crores, a year-on year growth of 51.7% while revenue stood at INR805.2 crores for H1, a growth of 61.5%. Operating EBITDA for the recruitment business stood at INR254 crores, up 61.3% from Q2 of last year. Margin stood at 60.8% versus 58.9% in Q2 of last year. EBITDA margins for H1 ’23 stood at 60.2%.

Cash from operations for the recruitment business during the quarter stood at INR280.4 crores, up from INR201.6 crores in Q2 of last year. The business generated INR515.8 crores of cash from operations in H1 ’23. Cash from operations as a percentage of billing for the business stood at 66% for the quarter. Billings for Naukri India for the quarter stood at INR356.2 crores, up 46.3% year-on year, while revenues for the quarter stood at iNR 352 crores, up 63.6% year-on year. The recruitment segment billing including acquired businesses like Zwayam and Do Select stood at INR442.3 crores, a growth of 44.8% Y-o-Y for this quarter. iimjobs and Hirist had an Y-on-Y growth of 47.3% in their billing numbers for this quarter. Zwayam and Do Select also reported serious growth in Q2 of this year over Q2 of last year.

The Naukri business continued its growth momentum and on the platform side registered increased jobseeker traffic and recruiter actions during quarter. Around 22,000 new CVs were registered per day during the quarter, a year-on year growth of 12%. The active base for our mobile app also continues to increase significantly, month-on month. The sales team continued with their strategy of creating more awareness around the value generated from our products to drive deeper value, optimized realization during the quarter. We increased our marketing spend during the quarter as we continue our sort of to invest behind our recently launched My Kind of Naukri campaign, which targets the Gen Z audience. We also upped our stake in Coding Ninjas from 26.1% to 51% this quarter. We invested INR135 crores. Investment shall help on recruitment business to explore and maximize business synergies in the learning space and take us towards our long-term goal of transforming Naukri from a jobs portal into a careers platform.

The Ambition Box platform launch has taken addition of Ambition Box Best places to Work in India Awards in Q2. In the education business Shiksha, Q2 billings grew 31.3% year-on year and stood at INR24.8 crores while revenue grew 20.1% to INR25.9 crores. Billings for H1 ’23 stood at INR55.1 crore, a year-on year growth of 30.9% while revenue stood at INR57.2 crores with an year-on year growth of 29%. The Shiksha business made an EBITDA loss of INR1.8 crores during the quarter versus a profit of INR5.1 crores in Q2 of 2022. Cash outflow from operations for the quarter stood at INR1.7 crores against an inflow of INR1.4 crores reported in Q2 OF 2021.

Moving on to the 99acres business. Billings in Q2 grew by 11.1% year-on year and stood at iNR 75.7 crores while revenue grew from INR48.3 crores in Q2 of 2022 to INR69.7 crores in Q2 of ’23. Billing for H1 of ’23 stood at INR136.8 crores, a year-on year growth of 51.2%, while revenues stood at INR136.1 crore for year-on-year growth of 39.6%. The operating loss for the quarter in 99acres stood at INR29.6 crores against a loss of INR21.9 crores in Q2 of last year, and the business reported a cash flow — cash outflow from operations of INR19.1 crores for the quarter against a cash inflow of INR4.4 crores in the same quarter of last year. In 99acres, we are seeing — regarding — seeing more higher sort of revenue growth across all categories, resale, rentals, commercial and new homes. The sponsors on the platform continued to grow year-on year, we were able to see increased inquiries for our clients with both increase in traffic growth and other multiple client delivery initiatives. We further increased our focus to improve reviews from the residents and to get more transaction prices of the platform to help buyers and owners, get more insights about the real estate market. We will continue to invest on platform, content, client delivery and marketing in the months ahead as well.

Moving on to the matrimony business, Jeevansathi. Billings in Q2 declined by 30.4% year-on year to INR16.9 crores and revenue declined by 28.7% year-on year to INR18.1 crores. Billing for H1 of ’23 stood at INR34.5 crores, a year-on year decline of 30.1% while revenues were at INR41 crores, a year-on year decline of 18.9%. Operating EBITDA losses for the quarter stood at INR26.6 crores for the quarter against a loss of INR21.2 crores in the same quarter of last year. Cash outflow from operations for the quarter stood at INR29.8 crores against an outflow of iNR 27.7 crores in Q2 of last year. The Jeevansathi’s the chat for free model has helped us accelerate — that helped in accelerated growth of platform engagement metrics. Degrowth in billings bottomed out in July and since then has been steadily improved. Jeevansathi team has continued to focus on improving the recommendation experience of the platform in addition to building brand salience in the category.

Our dating platform, Aisle, witnessed a growth of 152.5% during the quarter and registered revenues of INR7.99 crores. The business continues to evaluate new growth paths and accordingly all four vernacular apps were redesigned to make them more user friendly.

At the consolidated level for the company as a whole, net sales for the company stood at INR604.1 crore versus INR366.1 crore in Q2 of last year. For the consolidated entity at the total comprehensive income level, there is a gain of INR470.7 crores against INR13,848.5 crores for the corresponding quarter of the previous year. The gain for Q2 FY’23 includes mark-to-market gain of INR394.5 crores on investments held in Zomato and Policy Bazaar, listed companies being the difference between share price as at end and beginning of the quarter. The gain of Q2 FY’22 had included INR13,607.9 crores arising from the listing of Zomato in that quarter, and the mark-to-market gain therefore on the share price at that quarter end.

Adjusted for the exceptional items. PBT stood at a profit of INR148.7 crores in Q2 of ’23 versus INR69.9 crores in Q2 pf 2022. Thank you. We are now ready to take any questions that you may have.

Questions and Answers:

Operator

Thanks, Hitesh. We will now begin the Q&A session. [Operator Instructions] The first question is from Deep from B&K. You can go ahead and ask question, Deep.

Deep Shah — B&K Securities — Analyst

Yeah, hi thanks for the opportunity. So Hitesh, first question is actually around 99acres. So, what we’ve seen is, there is a mixed trend there. billings have only grown 11%, at the same time, our losses have remained. So, if you could just help us understand better what’s happening in that segment and how should we think about this segment going forward, especially that we are investing a lot more for brokers now. How should we think about 99acres as a whole?

Hitesh Oberoi — Co-Promoter and Managing Director

Yeah so, see what we are seeing in the market is that the real estate segment is back, property prices are going up, more real estate being bought and sold than was the case earlier. The real estate market was in the doldrums for many years, but it’s now sort of slowly and steadily bouncing back. There seems to be a shortage of supply because not enough projects were launched over the last couple of years due to COVID, at the same time, demand has picked up. So therefore prices are going up in several pockets. As far as our business is concerned, our business was hit very badly because of COVID last year, which is why you’re seeing solid growth in the first-half in terms of revenue because of the low base. But I think the way to look at 99acres is you know-how are we trending month-on month, quarter-on-quarter, so we are now at a point where we are we’ve hit a rate of — perhaps hit a monthly run-rate of about INR25 crores a month. At the same — yes. our losses have gone up because we are investing a lot more in product development, we are investing a lot more in marketing than was the case earlier and partly it’s also because of the increase in competitive intensity in the space, there are many more players who are active and they are spending a ton of money right now and therefore we are sort of being forced to respond to keep our share. How will things shape up going forward will to a large extent depend on how well we execute on the ground, number one. And so it will depend on how fast and how well we are able to execute as a team on some of the initiatives that we are pursuing inside the company and too it will depend on how competition sort of behaves in the market, if they continue to invest aggressively, then for a while we may be forced to up our marketing investments to counter them. On the other hand, if competitive intensity starts to decrease, then that will be a different ballgame, but the overall market looks decent, now we don’t want the market to become unaffordable for real estate buyers, we don’t want prices to go through the roof also, we don’t want it to be a market where people launch projects and they get sold immediately because of sudden surge in activity because then we’re not required. At the same time, we don’t want a very bore market also where nothing sells. So fingers crossed but after a long time, it looks like there is buoyancy in the market, that should be good news in the medium term at least.

Deep Shah — B&K Securities — Analyst

Right. Thanks for that. Also if you could help us understand a bit more about Broker Network. I see we investing a lot of money there. So, if you can help us understand what is it and any chance we are getting back into transactions or that is still not a place we want to explore?

Hitesh Oberoi — Co-Promoter and Managing Director

Yeah, so Broker Network is an investment. We don’t run the company, but yes, we have invested in the company and the company was pursuing a very aggressive marketing you know till recently. They are basically in two different businesses. They have — they enable site visits for new projects for developers and they charge for site visit, so that’s one model, and then they also sort of help — organize home loans and they take a cut in that. So that’s the second model you know sort of — second business earning. So now, they’re not — they want to make a transaction cut from developers. They’ve launched something in that area, early days still.

Deep Shah — B&K Securities — Analyst

Right. Perfect. That’s it from my side. Thank you so much.

Hitesh Oberoi — Co-Promoter and Managing Director

Thanks. Vivek, you’re not audible.

Operator

Sorry. Next question is Jagdish, he is Julius Baer. Jay, you can go ahead and ask ask your question, please. Jay, you’re on mute right now.

Unidentified Participant — — Analyst

Hi, am I audible?

Operator

Yes, you are.

Unidentified Participant — — Analyst

Hi Hitesh. A quick question. Could you comment on the IT sector and the demand in that space please?

Hitesh Oberoi — Co-Promoter and Managing Director

Yeah, see, for the last seven quarters, the IT sector was in higher — attrition rates are very high, there was massive inflation, tremendous hiring, again mismatch of supply and demand, not enough supply, you know, sudden surge in demand. And that was great for our business. Now anecdotally, what we’re hearing from people in the market right now and what we are witnessing in our company also is that attrition rates have come down a bit and things are normalizing. And therefore, I suspect growth in IT hiring will moderate going forward and now how much will it slowdown down by, very hard for me to say at this stage. Will it slowdown? Definitely. Will it crash.? I don’t know. For how long will it slow down? No idea again, it may depend on what happens in the U.S. because the IT sector is more indexed to what happens to the U.S. and to what happens in India. So that’s where we are as far as IT is concerned at this point in time.

Unidentified Participant — — Analyst

Thanks Hitesh. Got it. Thanks.

Operator

The next question is from Raghav. Raghav is from Citi. Raghav, please go ahead. Raghav, you are not audible.

Vijit Jain — Citigroup — Analyst

Hey hi.

Operator

You are audible now.

Vijit Jain — Citigroup — Analyst

Hello, can you hear me?

Operator

Yes, we can.

Vijit Jain — Citigroup — Analyst

Oh sorry, this is Vijit. So my question is first off on IT hiring. Hitesh, when you said also in the TV and in the press release that IT hiring is now normalizing. Just wondering, A, does normalizing mean back to pre-COVID kind of levels? Is that the definition of normalizing here at the moment? And related question, in the overall recruitment space, can you talk about any future investment plans in the other company that you invested in there, right, Coding Ninjas, that’s a learning space right, how should we think about that going forward?

Hitesh Oberoi — Co-Promoter and Managing Director

So again, very early days to — early for me to comment on how this IT hiring will sort of shape up going forward and October is a little bit misleading because of the festival season, many companies sort of slowed down their operation in the festival season. But what I said earlier, on the call I said, certainly attrition rates are trending south in IT, it was a crazy market till some time back, it is a more normal market now. Now that’ll not be the case with all companies, okay. Maybe some companies are doing better than others. Some are not. Now so that’s what I meant by things are beginning to normalize. It’s not as if IT companies are laying off workers, we haven’t come across any such sort of case at this point in time but certainly they’re negotiating harder, they’re taking more time. You know they are not under as much pressure as they were earlier, at least some of them. And attrition rates seem to be slowing down. By how much? I guess depends on the company.

Vijit Jain — Citigroup — Analyst

Got it. Thanks, Hitesh. And my second question was on Coding Ninjas investment plans there, how should we think about that going forward from both cash perspective —

Hitesh Oberoi — Co-Promoter and Managing Director

Yeah, so we’ve been invested in Coding Ninjas for a while and they have made good progress and which is why we’ve increased our stake from 25%, 26% earlier to now 51% and the idea is to sort of deeply integrate with Naukri going forward. Till now they were mostly focused on providing education solutions to students on — on-campus as undergrad students but increasingly they are looking to offer more and more courses — upskilling courses for working professionals as well and over time we will sort of integrate their offerings with the Naukri platform, it’s part of our overall sort of vision — long-term vision to transform Naukri from just being a job board into a more sort of holistic careers platform where sort of you know we help people not just find jobs but we also help prepare them to sort of find the right jobs for themselves, we inform them and prepare them and sort of teach them as well. So that’s the long-term game plan, of course, a lot will depend on how the business sort of shapes up over time.

Vijit Jain — Citigroup — Analyst

Great. So Hitesh, I guess — sorry one last question around that, is that more around the lines of online learning or there’s offline learning component there as well?

Hitesh Oberoi — Co-Promoter and Managing Director

No it’s more — right now, it’s only online learning.

Vijit Jain — Citigroup — Analyst

Got it. Great. Thanks. Sorry, if I can have one last question from my side, just on the recruitment side, the non-IT recruitment sector, you’ve called out as some of those spaces are picking up pace, from a more removing the whole low-base of the last few years perspective, how do you think that non-IT sector shaping up from here given that IT sector is normalizing? Should you — or do you think the share of non-IT goes up from whatever 40% odd of your billings or revenues to somewhere more closer to 50 plus or how should one think about that?

Hitesh Oberoi — Co-Promoter and Managing Director

Well, you know, see, the non-IT hiring is more indexed to the Indian economy and how the — GDP growth in India, now partly what we’re seeing is a surge in hiring on the non-IT side because non-IT companies are pretty much sort of because of COVID there were shut for some time, they had laid off workers, they were — business had contracted, now they’re bouncing back. There’s revenge travel, revenge shopping, revenge everything, right, and therefore we are seeing a massive surge in demand for talent in spaces like retail, travel, hospitality, banking, financial services, insurance, telecom, because of IT sort of — and so on and so forth. So we are seeing — so there is more demand for sales professionals, finance professionals, marketing professionals, customer service reps and so now what has happened over the last seven quarters was or at least for the last four or five quarters was that IT demand had picked up and there was a surge in demand and which is why the share of IT in our overall mix perhaps went up by about five, seven percentage points. Now if IT hiring slows down and non-IT companies continue to ramp up, then of course, you know, we might go back to how things used to be pre-COVID for us. But that will depend on whether this boom in the non-IT space is sustainable and how sustainable it is. So if it’s going to be like this for a while, then of course, the share of non-IT [indecipherable] come.

Vijit Jain — Citigroup — Analyst

Got it. Thanks — thanks a lot, Hitesh.

Operator

We have someone from Laburnum Capital who had raised their hand. I would request them please ask their question.

Amit Khetan — Laburnum Capital — Analyst

Yeah, hi, this is Amit Khetan from Laburnum Capital. Good evening and thanks for the opportunity. So I had a question on the matrimony business, so we’ve had a change in strategy I guess over the last six months or so if I’m not wrong, how is that playing out, can you share some metrics either in terms of market share or traffic share like you do for the verticals because otherwise we cannot make sense of what’s really going on here. And second, just related to that is how much are we spending on marketing on a quarterly basis and has that gone down post our new strategy or gone up just some numbers, broad numbers would be really helpful.

Hitesh Oberoi — Co-Promoter and Managing Director

Yeah, no, so I can’t share all the metrics for competitive reasons but we are very happy with the progress that we’re making. We have gained substantial traffic share in our view over the last few quarters, especially in the communities where we are reasonable players. People are — more people are registering with us, people are spending more time in the platform, we are making more matches and hopefully more and more marriages are also happening through us and so we are very happy with gains in traffic share. And this is despite us slowly we’ve cut down marketing spends also, it’s not as if we are spending crazy money on marketing. Our revenue is down 30%, our collections 30%, billing is around 30%. But despite that, we are perhaps losing only as much money as we were losing earlier. And If the numbers continue to trend in the right direction, then losses in the matrimony business going forward will be much lower than what losses were in Q3 and Q4 of last year. So in Q3 and Q4 of last year, we had upped our spend on marketing significantly in our matrimony vertical and since then the marketing spend has been slowly trending down. Now we don’t want to sort of cut marketing overnight also because we need to sort of get the word out that we are free because people need to know that we are free, so for sometime, this marketing spending will continue, at the same time, we are working on new models, there are new ways and means to monetize our audiences, but early days on that front. So wait and watch for the next few months, let’s see how it goes.

Amit Khetan — Laburnum Capital — Analyst

Got it, any sense of have we lost — have we gained market share in terms of number of users?

Hitesh Oberoi — Co-Promoter and Managing Director

Yeah, absolutely, like I said, we’ve been gaining traffic share on the user side in all the communities where we are present. So while we have lost market share as in revenue market share, we have certainly gained on user market share.

Amit Khetan — Laburnum Capital — Analyst

Got it. Thank you.

Operator

We have next question from the line of Vimal Gohil. Vimal, can you go ahead and ask your question, please.

Vimal Gohil — Alchemy Capital — Analyst

Yeah thanks — thank you for the opportunity, sir. Sir, my first question was on our Naukri business. Just wanted to get a sense on the slowness that we’ve seen in the unique user. I do understand that partly it is because of the IT — IT hiring slowing down, but should that essentially to a decline in user base for us? That is point number one. And the related point would be that you have more than made it up by increasing the revenue per unique user —

Hitesh Oberoi — Co-Promoter and Managing Director

Unique user, by you mean what. I mean, customers or on the recruitment side or on the job —

Vimal Gohil — Alchemy Capital — Analyst

Yeah, on the recruitment side on the unique — number of unique users — unique customers.

Hitesh Oberoi — Co-Promoter and Managing Director

Unique customers. Which number are you referring because as far as we are concerned, we’re not seeing any decline in unique customers, quarter-on-quarter or year-on-year?

Vimal Gohil — Alchemy Capital — Analyst

Yeah, yeah, it’s a sequential decline, on the unique customer side.

Hitesh Oberoi — Co-Promoter and Managing Director

Yeah, I’ll say a lot of these customers are at the bottom, so they don’t generate too much revenue for us and often it’s a function how many holidays fall in that quarter, etc, etc. So I would not read too much into that number but in general — in general, when the market slows down, then new customer addition does go down a bit.

Vimal Gohil — Alchemy Capital — Analyst

Got it sir and sir just wanted to get again you know you sort of more than made it up on the average revenue that you generated per unique user, that was my second point. I mean how much of that would you relate to you know more a better mix and the addition of your services like Do Select, slip Zwayam, etc.

Hitesh Oberoi — Co-Promoter and Managing Director

So we don’t give the breakup but when we sort of bill more from a customer mostly on account of one sometimes they buy more services as in we have launched many new products and services, so a lot of customers end up buying some of these new services that we’ve taken to market; two, we’ve seen serious — good pricing gains over the last few years or the last few quarters you know. And so that’s been across the board, we realized better prices than we used to realized, again, when we went into COVID, we were discounting heavily because the economy was slowing down and during COVID also we have to discount heavily to sort of retain because companies were not hiring, but therefore, our pricing has gone down substantially over the last two, three years, so that is now gone back to normal levels, in fact, we are working hard to sort of customers see the value that we’re creating for them, through the some of the tools we’ve launched, data analytics tools and customer analytics tools and so that’s helping us realize better prices. And thirdly, also what happens in a good market is you know customers need to hire more people, so they buy more volume. So it’s perhaps — so ARPU has gone up, it’s a mix of all three.

Vimal Gohil — Alchemy Capital — Analyst

Right. Right. Just to understand that, you made a pertinent point that — and how many — what is the share of our customers who are using these add-on services that we have? Is the penetration up there, I mean do we have some low-hanging fruit there? Or you have almost — most of their — most of your large customers using your suggestion already?

Hitesh Oberoi — Co-Promoter and Managing Director

No-no No-no, so we have a long way to go, of course, there is more competition in some of these new spaces and there are other players we’re competing with, but penetration levels are nowhere close to even 20%, 30%, 40%. It will differ for different products, but they are very low.

Vimal Gohil — Alchemy Capital — Analyst

Understood.

Hitesh Oberoi — Co-Promoter and Managing Director

But there is no competition as well.

Vimal Gohil — Alchemy Capital — Analyst

Understood. And lastly sir, just one question on Coding Ninjas. I think you made a point on finding some synergies with the core Naukri platform. My belief is that Coding Ninjas would be a direct B2C sort of a model and our platform is more B2B. How are you sort of looking at synergies then, are you looking to sort of cross-sell Coding Ninjas to your existing enterprise customers or how will that transition —

Hitesh Oberoi — Co-Promoter and Managing Director

See, our platform is not B2B, our revenue is mostly B2B, right. We have a B2C part of the business, so we have millions of jobseekers who visit our platform every month, they spend a lot of time on the platform. That is just on the platform they apply for jobs on the platform, so there’s no shortage of users on the platform, revenue generation is mostly on the B2B side, about 70% of our revenue comes from jobseekers as — even today we have this pass over business where we sell services to jobseekers, that’s not the primary focus, but we get about 7%, 8% of revenue, or 5%, 6% of revenue from the jobseekers today, you are right, Coding Ninjas is a B2C offering right now, there is no plan of — plan to take Coding Ninjas to reconsider at the moment and therefore what we will do is integrate the Coding Ninjas offering with our Naukri platform more and more going-forward and in the process hopefully we will break down the cost of acquisition — customer acquisition for Coding Ninjas.

Vimal Gohil — Alchemy Capital — Analyst

Got it sir, Sounds interesting. Thank you so much sir and all the very best.

Hitesh Oberoi — Co-Promoter and Managing Director

Thanks.

Operator

The next question is from Vivekanand from Ambit Capital. Vivek, you can go ahead and ask your question, please.

Vivekanand S. — Ambit Capital — Analyst

Yeah, thank you for the opportunity. Hitesh, you said that the increased billing you highlighted the three factors, were they in order of importance in terms of contribution to the increased billing or was it just in no specific sequence?

Hitesh Oberoi — Co-Promoter and Managing Director

No, in no particular sequence — no specific sequence.

Vivekanand S. — Ambit Capital — Analyst

Okay. And as far as the commentary on IT is concerned, you did mention that things are now normalizing, so would a sharp decline in attrition rate meaningfully weigh on the volumes right now and is there a possibility that we might be looking at a potential decline in billing for recruitment if this were to play out, let’s say, attrition declines by say 5% industry-wide, would this meaningfully result in a sharp cut in the billing or are we looking at a situation where things — this is like the new base where all the discounts have been withdrawn and all the pricing is back to normal levels?

Hitesh Oberoi — Co-Promoter and Managing Director

See, very hard for me to say. I don’t know how it’s going to play out, we don’t know for sure whether there is like — there is a fall in attrition but how much will attrition fall by is hard for me to say. Whether attrition will fall for one quarter or whether this will be a sustained slowdown, unclear at this point in time. Have companies over-hired? A lot will depend on that also, right, or when they’re still scrambling to get talent and suddenly now, things are getting better. So if — I guess the situation will be different for different companies. So it’s very hard for me to say, what I can tell you for sure is that attrition rates seem to be trending south, now how much south, God knows. Where will they finally stabilize? Unclear to me. We have seen a sharp fall in attrition in our company, that’s because many of our employees used to leave to join startups and startups as you know are in big trouble. But we don’t make a lot of revenue from startups, we make mostly sort of make our money from IT services companies and from captives. In the past, we have also seen that whenever there is a slowdown or a recession in the U.S., the Indian IT industry gets hit for a quarter or two, but in the end benefit because a lot of jobs — more and more jobs jobs are outsourced to India. I don’t know whether that will happen this time around, but if were that to happen, then business will start picking up again in a couple of quarters. Demand should for IT services companies should start picking up again. So, early days, very difficult for me to say how it’s going to play out.

Vivekanand S. — Ambit Capital — Analyst

Okay, just one follow-up with respect to the billing trends, so when we look at the growths today, right, the Naukri India 46% year-on year billing growth, is the trend meaningfully different for IT versus non-IT? And secondly, on the billing side, would the segments of IT hiring which is IT services, captives and let’s say the domestic firms hiring for their IT needs, is the billing trend very different on that count also?

Hitesh Oberoi — Co-Promoter and Managing Director

Not very different for Q2, right, but what I said is that — listen, what we are picking up is some stories around IT hiring slowing down going forward, so it could change going forward, right, but not very different from what you do.

Vivekanand S. — Ambit Capital — Analyst

Okay, you are saying that even this quarter the billing growth for IT versus non-IT was on a similar tangent, is it?

Hitesh Oberoi — Co-Promoter and Managing Director

Yeah, I would — in fact, non-IT was pretty solid even in Q2 — sorry, even IT — IT hiring growth for us was pretty solid in Q2 as well.

Vivekanand S. — Ambit Capital — Analyst

Okay, fair enough. So second question is on 99acres. Initially, you mentioned quite a bit about how you are seeing that the market is in a sweet spot for your platform, and of course, you feel that this momentum is here to stay, but just trying to understand this better, you had — couple of years ago, I believe you had done a reorganization focusing on specific verticals, new launches, resale, rentals, commercial, so would it be possible for you to give an update on that on where this is progressing now maybe segment-wise comments. Thank you.

Hitesh Oberoi — Co-Promoter and Managing Director

So internally this is how we are organized, we have teams which work on resale, we have a team which works on new homes, we have a team which works on rentals, we have a team which works on commercial. Of course, the commercial and rental parts of the business are small, it’s mostly new homes and resale maybe get our revenue. Almost all sectors are sort of — have bounce back, so there’s a lot more commercial activity in the market as companies go back to working from office, there’s a lot more rental activity in the market because a lot of people have sort of left their — the cities in which they were working and gone back home, they are all coming back and therefore there is a surge in demand for bigger houses for more houses to rent. Suddenly, we are also seeing real estate prices go up and that has bought broad — a lot of buyers back into the market also and of course people have seen at least in IT seen very good salary increases over the last couple of years. So suddenly there is a demand for more housing as well and at the same time supply for new homes — of new homes has gone down, there’s less inventory because they were not enough new projects which were started during COVID. So on the whole, the whole market is looking attractive and pricing — prices have gone up. At the same time, you worry about the fact that prices go up too much and real estate would not be affordable, and that will result in a lot of buyers sort of getting priced out of the market and so market in the middle is [indecipherable] was best for us.

Vivekanand S. — Ambit Capital — Analyst

Okay, my last question is on the number of customers that you report, that number both on the builder and the broker side has gone up significantly. So are we —

Hitesh Oberoi — Co-Promoter and Managing Director

Compared to last year — compared to last year?

Vivekanand S. — Ambit Capital — Analyst

Compared to last year — actually the last couple of quarters this number has been quite elevated compared to let’s say the trends that were there in all four quarters of fiscal ’22, so are the benefits of the billing completely in the base now in terms of the pricing interventions on multiple products that we would have sold to these customers? Or is there more scope to extract billing from these customers till we start looking for new customers who add? I’m asking because between fiscal ’19 and let’s say till 2Q or 3Q fiscal ’22, the number of broker and builder customers were pretty similar and now they seem to be 50% higher.

Hitesh Oberoi — Co-Promoter and Managing Director

Are you sure that because I hope you’re not including owners as well.

Vivekanand S. — Ambit Capital — Analyst

No, no, no, I am just talking about the 32,700 broker and 6,400 builder customers. So this is on your on your slide pack, slide number 43.

Hitesh Oberoi — Co-Promoter and Managing Director

Okay. I don’t know, maybe we can get back to you on this offline. We have seen, of course, our customer base went down during COVID and H1 last year was impacted because of COVID and compared to of course H1 of last year we must have seen a strong recovery on the number of customers but let me get back to you on how much the numbers have actually gone up by, let me just sort of recheck and get back to you. Vivek, can we do that?

Operator

Sure, of course.

Vivekanand S. — Ambit Capital — Analyst

Sure. Thanks a lot Hitesh. All the best.

Hitesh Oberoi — Co-Promoter and Managing Director

Thanks.

Operator

So the next question is from Mohit, Mohit is from [indecipherable] Capital. Mohit, you can go ahead and ask your question.

Unidentified Participant — — Analyst

Hi thanks for the opportunity. I wanted to ask on the equipment business like you know IT as we have already spoken about attrition rates are going down and that might moderate the growth, so just wanted to get your thoughts on other verticals like BFSI which also one of the white collar markets in India, do you have any ambition to scale up on that front so that you know you can have elevated growth rates in the future because the contribution, if I look at the contribution, it has made around 6%, 7%, right, throughout last so many quarters, so is there any — do you have any plans or you think you can increase your contribution share from BFSI sector?

Hitesh Oberoi — Co-Promoter and Managing Director

See, our share is, you know, is what it is because it’s a much smaller segment when it comes to hiring compared to IT, right, so there are — maybe 10,000 IT companies or 8,000 IT companies you work with, the number of BFSI players in the market is much — is fewer and they don’t want to draw as many people as IT companies do. Of course, we would want to up our wallet share from all BFSI clients and we’re working on that, but it’s unlikely that there sort of — their share in our overall mix will change significantly over the next couple of quarters. But it may grow — that segment may grow faster than other segments if the market is doing well, but it’s unlikely that 6%, 7%, it can become 10%, 12%, 14% overnight. It’s not likely.

Unidentified Participant — — Analyst

Sure. That’s all. Thank you so much.

Operator

Next question is from Rohan. Rohan, kindly go ahead and ask your question, please.

Unidentified Participant — — Analyst

Yeah hi so my question is towards 99acres side. So, basically I just started following your company and you know while on the Naukri you are market leader and The numbers are also improving quarter-on-quarter and there are some really great numbers. From 99acres point of view, what I understand is that in the last Annual Report of yours, there was — you mentioned that some ESOPs have been issued, right, so that expenses would have included ESOPs, so basically what I want to understand is that why we compare the QonQ losses of this quarter and this half with the previous quarter and previous half year. Is there any component of ESOPs also in that? You know because just to understand what the you know apple-to-apple comparison would look like.

Chintan Thakkar — Director & Chief Financial Officer

Yeah so both would include ESOP charges, although I don’t think that it would be significantly different, on a consistent basis, we keep on giving ESOPs and we charge it off as per the accounting standards. So when we are looking at the EBITDA numbers [indecipherable] that includes the charge for [indecipherable].

Unidentified Participant — — Analyst

Okay and second question is towards your marketing spend now in the previous quarter call you said that you are looking at marketing spend of like INR30 crores to INR40 crores on a quarter-on-quarter basis, so going forward, do you still hold that number or you expect it to increase or decrease?

Hitesh Oberoi — Co-Promoter and Managing Director

Yeah it will depend on competitor activity which is what, I said earlier on the call also, so could be INR25 crores, could be INR35 crores, could be INR40 crores, could be INR20 crores, it will depend on whatever we — what we need to do to sort of defend our share in this market. So we decide on our sort of marketing spend on a quarter-on-quarter basis.

Unidentified Participant — — Analyst

Okay, thanks, that’s it from my side.

Operator

The next question is from Pranav. Pranav, kindly go ahead and ask your question.

Unidentified Participant — — Analyst

Yes. Thanks for the opportunity. My first question is regarding 99acres. If I look at the market share, the traffic market-share that has been sort of trending down, and if I look at — that’s the only one player that the housing which has gained market share. Is it purely because of the advertising budget what they’re having or you think there is something else to it? Because the gains what they’ve done in the market share are quite significant. And if there are sort of sticking around and we are not looking at a sort of a duopoly kind of market maybe there are three very strong player which can emerge. So how do you see that?

And my second question is on the margins of Info Edge. I mean you think 63%-odd margin, historically they’ve been slightly lower. But how should we see this in the medium to longer-term? Thank you.

Hitesh Oberoi — Co-Promoter and Managing Director

Yes. See the traffic share, that’s the structure business administration should be have resolved, because there are different types of users on our platform. So there are people, who are looking to buy new homes, there are people are looking to buy resale property, there are people who are looking to buy rentals. They’re looking to sort of rent properties, so on and so forth. Now there are people looking to buy high-end properties, there are people looking to buy a low-end properties, now every user is not the same, a rental user for example is very hard to monetize.

On the other hand by spending on marketing you can get a ton of the business on our platform. So this market share or traffic share business has to be sort of diced and sliced — the traffic has to be diced and sliced in different ways to understand what’s really happening in the market. But, yes, you are absolutely right in saying there housing has to be in structure over the last few quarters. And we would like — at least our team believes this mostly because on account of their higher marketing spend, they are pledging right now as in speak.

And yes, there are more than two players which are sort of aggressive in the market at this point in time. Now, of course, it will take a while for us to settle down. Nobody — yes, right now there are many players competing — but the market is also growing rapidly, but there are many more players. So let’s see how this plays out. But all traffic is not the same. And as far as our margins have influenced our recruitment, margins of the recruitment business go. See, if our recruitment business continues to grow at even 18%, 20% per annum, these margins should be easy to maintain, in fact, we can even better than going forward, but if growth slows down considerably then, of course, margins may take a bit of a hit.

We don’t expect the kind of wage pressure you saw in the last one or two years to continue going-forward, because we’ve seen a slowdown in our attrition also unless things change again on that front. But if things change on that front, then of course our building growths were also low start looking up once again.

Unidentified Participant — — Analyst

Sure. One small follow-up on 99acres, so you said that the all traffic is not same. Can you give some color on that? I mean…

Hitesh Oberoi — Co-Promoter and Managing Director

Yes. I mean for example, let’s say we get 10 million users, let’s say, I mean just picking a number, and if 5 million of those are rental users, then our rental user is not as valuable as a resale buyer. On a resale buyer, you can 10x, what do can from a rental user, right, as a platform. In fact — if — and two, if the rental user is looking to rent property at less than INR10,000 a month for example, nobody can make money from that rental user. So all user is not the same.

Unidentified Participant — — Analyst

Sure. But I mean — so can you give some color on — does that mean that Housing.com could potentially have a larger share coming from the rental or some player who is stronger in the rental segment and you are stronger on the resale or — and some other player is stronger in the builder. Is that the case? Or…

Hitesh Oberoi — Co-Promoter and Managing Director

I haven’t looked at the Housing numbers very closely, but yes, I can say for sure that if — a buy user is much more monetizable than a rental user.

Unidentified Participant — — Analyst

Sure. Thank you so much. That’s it from my side.

Operator

Next question is from the line Seema. Seema, you can go ahead.

Ruchi Mukhija — Elara Capital — Analyst

Hi, this is Ruchi from Elara Capital. I have couple of question. First, sir, post pandemic we have seen that digital intensity or enterprises has increased, even if I look at the Naukri platform your unique number of clients are up about like 26%. So could you highlight this? Have you seen a change in the behavior of let’s say strategy or beyond so to say large mature user? Has the lower base of customers shown some changes in terms of consumption pattern or usages?

Hitesh Oberoi — Co-Promoter and Managing Director

Yes. Absolutely. For example, we have a small blue collar platform job here, we sort of — and we’ve been seeing significant traction on that platform. We don’t monetize right now, we are still getting more and more users to use the platform, and these are mostly blue collar workers who make INR15,000 a INR14,000 a month, INR22,000 a month. Technicians, delivery boys, data entry operators, salon workers, and the traffic is growing month-on-month. So — without doubt, I mean everybody is now on the Internet, and everybody is going more and more comfortable using the Internet, even small businesses. Earlier it’d just be very hard to get small businesses to use the Internet. But now everybody is used to smartphones, they’re buying grocery online, they’re ordering food online, they’re buying insurance online, they are shopping online. So now it’s — they are making payments online.

So I think pretty much everybody is sort of now used to sort of, I mean they know how to operate a phone, they know how to make payments, they know how to post jobs, they know how to post — they know how to take pictures, they know how to take videos. So it’s getting easier and easier with every passing month.

Ruchi Mukhija — Elara Capital — Analyst

Sir, my question was trying to understand, is Naukri.com maybe to monetize that behavior.

Hitesh Oberoi — Co-Promoter and Managing Director

So if we demonetize businesses, and earlier it was perhaps — so we have a sales team, and we have tele sales team, and we have people sort of making e-commerce payments on the platform. Our tele sales stroke — e-commerce business has been growing rapidly. And that’s mostly the business we get from small enterprises, these are mostly people who buy online, we don’t have sales people who reach out to them, training them, etc., but then mostly small customers. So they don’t have big part of our revenue, okay, but they are to our customer base, and they get us volume growth. Maybe this is certainly benefitted from this time. And like I said in our JobHai business, we are continuing to sort of add whole users, and these users are not in Naukri and be able to monetizing them as yet, but we would monetize them.

Ruchi Mukhija — Elara Capital — Analyst

Understood. One more question for Naukri platform. So idea hiding on Naukri platform was down 3% Y-o-Y September quarter as per the job index, but yet we saw 55% of growth. So could you help us understand what tries this contrast? Is it completely explained by better [Technical Issues] or how do you see, I mean, IT matters in September quarter compared to the JobSpeak index minus 3% Y-o-Y growth in the quarter?

Hitesh Oberoi — Co-Promoter and Managing Director

It’s two things. See one everything is not correlated. JobSpeak index measures the number of job listings on our platforms, right? And — but lot of the hiring on Naukri happens to our database product, right? So it is possible that database hiring was not hit as much as hirings through job postings, right? That’s one. The second thing is even companies buy Naukri products, mostly the big customers they buy for a year, right? So even if there is a temporary hiring and we expect hiring to pickup going forward. They buy for the year and it’s one of the — and they are more likely to cut down hiring through recruitment consultants and more likely to cut down hiring through other expensive channels first, then through Naukri, right?

So I suspect companies — perhaps many companies have not experienced, I mean, when they’re seeing attrition slowed down, they had been — they hope that or they believe that it’ll be still be tough to hire going forward. And two, like I said our database activity was not hit as much as our job posting activity last quarter.

Ruchi Mukhija — Elara Capital — Analyst

Understood. One last question, this is for 99acres. So on the 99acres platform if I look at your quarterly revenue per page listing, it shows quite stop [Phonetic] jump, 93% Y-o-Y. In tandem if I compare your thin mix between broker and the builder, it hasn’t changed much, it’s kind of there there. So can you help us understand what’s driving this, is it price increases that we affected or the new services, analytics in kind or mix change? How to read it?

Hitesh Oberoi — Co-Promoter and Managing Director

Sorry, I didn’t — the revenue per paid listing has gone to 93% is it?

Ruchi Mukhija — Elara Capital — Analyst

Sure, sir. Yes.

Hitesh Oberoi — Co-Promoter and Managing Director

See, what I can tell you at a very macro level, we have launched a premium listing product, right? And over the last few months, we’ve updated many of our customers to premium listings. And as a result of that, our average revenue per listing has moved up essentially in 99acres. I suspect it’s mostly that, but if there is anything else we’ll get back to you.

Ruchi Mukhija — Elara Capital — Analyst

Okay. So it’s largely pricing pieces. Thanks. Thank you all the best.

Operator

Thanks, Seema. [Technical Issues] next question, we can please move forward.

Unidentified Participant — — Analyst

Hey, thanks for the opportunity. So first question is on Naukri. So just wanted to understand to your previous comment that the pricing in the past has gone up decently well. And now if, I were to look at your average billing per unique customer that is around 75,000-odd [Phonetic] number. Going ahead, how should we, think about it, like if there is a decline in number of unique clients, how would this number trend? Basically, your realizations, how would they trend going ahead assuming that it is a slowdown in IT?

Hitesh Oberoi — Co-Promoter and Managing Director

Well, it also depend on how well the IT — non-IT segment continues to perform. So certainly if the IT sort of — if IT hirings slows down, then we will not be able to effect major price increases with our customers in IT realizations, may not grow as much as they do last year. It will depend — what happens for IT. On the non-IT hiring we expect our realizations to boost going forward. And where we will end up as a company we’ll depend on how much — how fast an online business grows.

Unidentified Participant — — Analyst

Okay. And secondly keeping on Naukri recruitment side, your — if I were to look at your operating expenses for the segment. They have moved up from INR110 crores last year 2Q to a INR164 crores this year. Now that is significant jump of 50%, may I understand — may I know, like where are those expenses going? Because we don’t do a lot of marketing there, right? So what is other moving part of it?

Hitesh Oberoi — Co-Promoter and Managing Director

So there are three things happening there. One is, we had to effect major increases last year. Because of high attrition and because that’s what the market was like outside. So in fact for our — in many parts of the company we have to give salary increase twice last year, that is one. The other is, we’ve also sort of added more people over time, because we have sort of moving to digital areas, so we acquired companies, we have launched new verticals, and so we have added a lot of people for example in the AmbitionBox, we’ve added a lot of people in the JobHai vertical, we’ve added a lot of people in Zwayam which we acquired some time back, DoSelect and so on.

So in many of these new areas we are investing and investing aggressively. And so you added headcount and — a lot of this headcount is like product headcount is expensive headcount, design headcount. So I guess it’s a combination of these two or three things which has led to operating costs going up. We’ve also invested more in — we’ve also been investing more of marketing for the last few month, we’ve launched new campaign to target — to reach out to the audience, my kind of Naukri. So if I’ll — our marketing spend is not a big part of our overall spend, it is likely to be substantially higher than what it was last year.

Unidentified Participant — — Analyst

Okay. And just a last one on clarification basically on the headcount. So if I were to look at the last two quarters’ headcount that has gone up by 11%. So is this related to the employee additions in the verticals that you just mentioned or like is it somewhere else?

Hitesh Oberoi — Co-Promoter and Managing Director

Mostly in the newer verticals, so — in all our businesses. So like I said in JobHai and AmbitionBox and Zwayam in the Shiksha study abroad vertical, we’ve also beefed up our headcount in tech and product in 99acres. So in the faster growing parts of the business we’ve added more people in newer — in the newer verticals we’ve added more people, and some of these verticals we’re likely to monetize, like JobHai we’re not monetizing like them, BigShyft, we have added people, that’s another platform that we’re sort of trying to build-in house.

So the BigShyft also grown to some 80, 90 people over time. So we have a lot of these new areas we are investing in, where we are adding a lot of people, because we’re building new products, we are trying to innovate a lot more than we were innovating earlier. We’ve acquired some companies, so that headcount has also moved on to our books.

Unidentified Participant — — Analyst

And will that addition slowdown in case your billings also slowdown? Or would you continue to invest, and so there will be pressure on margin also?

Hitesh Oberoi — Co-Promoter and Managing Director

See it’s depend on what kind of opportunity we see in these verticals. So if these verticals start responding well, and we see opportunity for growth, then we’re not going to worry about the margins moving up or down by a couple of percentage points. On the other hand, if these — what it does require a lot more work and we feel that we haven’t got the product market fit right and there we need to tinker with them a little more to sort of get our act together, then of course, we will slow down investments in these verticals.

Unidentified Participant — — Analyst

Right. And just one thing I’d just highlight. I think there that is an anomaly in your presentation, so your sales, servicing and client facing stock, last quarter it was showing 37%, now it is showing 63%, historically it has been around 60% to 62%. So I think there is an anomaly there, if I’m just wanted to get a sense on that.

Hitesh Oberoi — Co-Promoter and Managing Director

We’ve made a note of that, we’ll get back to you. Vivek, can you make a note of that.

Operator

Sure.

Unidentified Participant — — Analyst

Sure. Thanks.

Operator

Next question is from Ankur Rudra from JP Morgan. Ankur, you can go ahead and ask your question please.

Ankur Rudra — JP Morgan — Analyst

Hey, thank you. So just first question, Hitesh you highlighted several times that, I think IT hiring is heading back to normalcy. Could you define what is normalcy? Is this sub 10%, 15% growth, is it 15% and 20%, what’s in your mind is normalcy?

Hitesh Oberoi — Co-Promoter and Managing Director

I wish I could tell you, because see till last quarter even the IT part of our business did really well, right? What I was just — but I’m beginning to pick-up some noise in the market that okay completely saying, listen IT has been down, business is not as it could, we are not likely to work 30%, 40% or whatever, as a growth moderate going forward. And then negotiating a little harder than they were earlier, that’s what I’m picking-up from our sales team. But October is also very different month, because see this year Diwali was in October, last year Diwali was in November. So equity slows down at this time. We will know only for — only in the weeks to come as to what shape or form this sort of thing would take. But we are sensing that, that there is a slowdown in IT hiring. I don’t know how much, really hard for me to say.

Ankur Rudra — JP Morgan — Analyst

Sure. Right. No, that’s fine. I’m not — I don’t have an issue with slowdown, I was just curious about structurally what do you think is normal hiring, a normal growth for your business, given IT goes back to let’s say sub-10% growth for 8% to 10%.

Hitesh Oberoi — Co-Promoter and Managing Director

I don’t know, I mean if they’re going they will still need to add more people and overall growth is going to be a function of sort of gross additions, right, minus campus hiring. That’s one. And, of course, we are, like I said, we’ve been working on our products and services to ensure that we get more wallet share from our customers and we can help them hire more people. So it’ll be a combination of two, three factors, yes, it’s very hard for me to — I mean — the long-term our number would be 20%, 50%, 25% is hard for me to say.

Ankur Rudra — JP Morgan — Analyst

Understood. In IT, just how much of your business momentum depends on attrition versus underlying market growth?

Hitesh Oberoi — Co-Promoter and Managing Director

See if this is a big part of the whole story, because attrition — if attrition rates grow by 50%, for example, if a company was — had 10% attrition earlier, now it has 15% [Phonetic] we need to hire more people to stay at the same place, right? So attrition makes a huge sort of difference for our business, attrition also results in wage pressure. And when there is wage pressure, and also results in a lot of noise inside the company, because this business people want to service customers and they want people onboarded quickly.

And at that time — so — and when that happens, companies won’t think twice about whether they’re getting a 10% discount from Naukri or a 13% [Phonetic] discount from Naukri, right? Because at the end of the day we are a very small part of what they spent. So companies have billions of dollars of revenue in IT spend less than $1 million in us or less than $0.5 million in us. So they would rather sort of give us whatever we want than — So on the other hand, of course, if demand picks up that also helps, but if a company needs to hire 10% more people than earlier, that’s okay, it’s just 10% more people, but if attrition rates go up by 30% or 40%, that’s 40% more people.

Ankur Rudra — JP Morgan — Analyst

Understood. I mean, your comment that growth is generally quite strong both in IT and non-IT suggests that non-IT boost is extremely strong, because — at least I mean close to 50%, if not higher. That is very surprising to me, because in the past we’ve really struggled to grow non-IT. I mean this is like pre-COVID. Could you maybe highlight if there is any industry driving this or are these just tech profiles in non-IT industries that are driving it?

Hitesh Oberoi — Co-Promoter and Managing Director

It’s perhaps a bit of both. But you see a lot of non-IT companies had not hired for a while and now things are getting back to normal. Their business is growing much faster. If you look at our JobSpeak index, you will get a sense. Some of these industries — jobs from them on our platform have been — were up 70%, 60%. 80% over last year. Of course it’s different for different industries. But see these companies had pretty much — they have actually shrunk in terms of headcount, many of them over the last couple of years because of COVID.

And so partly it is sort of — they are getting back to their normal pre-COVID normal and partly it was also — the disruption with COVID costs. People have quite jobs. Many people don’t wanted — did not for a long time want to go back to high contact sectors of the economy. Partly, it is also like you said many of these companies want to digitize faster than earlier. And therefore they are hiring more digital talent. So that’s also happening.

So now, whether this is — now, this may — we may also go through a phase where this sort of continues to be the case for maybe another couple of quarters and things go back to normal in non-IT. But a lot will depend on what happens to GDP growth. In the past, we’ve seen a 6% GDP growth in India, people are very difficult to get. You start seeing wage pressure, you start seeing high attrition. We start — hiring costs go up, retention is difficult. At 5%, 5.5%, you are somewhere in the middle. At 4%, things start to slow down. Companies come under pressure. So a lot will also depend on — for a couple of quarters, like I said, maybe revenge hiring, because they laid off earlier and then after that a lot will depend on what happens with the economy and what the new normal GDP growth is.

Ankur Rudra — JP Morgan — Analyst

Got it. No, I appreciate that comment. Finally, in terms of the investment environment, how has that evolved for your investee firms? From your perspective, we’ve seen slightly bigger change this time in existing investments. Have you recalibrated your investment style, given the current investment/business environment? And are you stepping up versus other investors at this time?

Hitesh Oberoi — Co-Promoter and Managing Director

Sanjeev, are you there? You want to take that?

Sanjeev Bikhchandani — Founder and Executive Vice Chairman

Yes, I’ll take it. I think two things have happened in our conduct and in the conduct of other investors. Number one is, we are of course seeing many more deals because if funding is little scarce, more and more companies will jump to us. That’s only good because then you get greater choice, then you get a benchmark. The second is, we are going a little slow. So if you look at our Fund, I think we deployed in a double quick time because that was — market was booming. We got a — we went in, got our funds, that funding is looking good, at least on paper, given the follow on rounds that have happened externally, post our going in.

In this Fund, we are going slower. We will take probably a full three years to deploy first checks and we are taking our time and we are going into small rounds initially and then doubling down. So we are less trigger happy actually. And that was the case for the market. One big risk thing that has happened is that you got to start worrying a little bit more about where this company will get its next round from, and you got to think long and hard about that before you go in, because [Indecipherable] doing yourself, if you have that condition. In Fund I you could reasonably assume that half decent company will get a sanction pretty easily for other investors.

Ankur Rudra — JP Morgan — Analyst

Understood. No, this time because you did cross 50% in a couple of your investments which showed either you were very confident.

Sanjeev Bikhchandani — Founder and Executive Vice Chairman

No, those are strategic investments. That is Coding Ninjas, that is strategic. And there obviously we are very confident that we have been with the company for a while.

Ankur Rudra — JP Morgan — Analyst

So this will — do you think you expect them to merge with your existing business over time or will this remain independent in the medium to long-term?

Sanjeev Bikhchandani — Founder and Executive Vice Chairman

Chintan, Hitesh?

Hitesh Oberoi — Co-Promoter and Managing Director

Yes. So like I said, Coding Ninjas, especially we are likely to sort of work very closely with them going forward. We see them as a big part of our overall strategy of transforming Naukri into a carriers platform over time. We will deeply integrate their offerings with the Naukri platform over time. Now — and if we get a good response, then we will see what to do after that.

Ankur Rudra — JP Morgan — Analyst

Okay. At this time, if that’s the reality, why stop at whatever this is 50%, 60%, why not go the whole home?

Hitesh Oberoi — Co-Promoter and Managing Director

I mean, if we get a good response and it makes sense for both companies to sort of work even more closely together, then we will see.

Sanjeev Bikhchandani — Founder and Executive Vice Chairman

Listen, I mean, part of it is out of the deal also, yes. If you want to take out the founders, they will ask for certain valuation right now, which we may or may not be comfortable giving, given where the company is today. At the same time, if you take out the founders completely, then they won’t have an upside in the future which will motivate them to stay. So, it’s — I mean, online business, a lot of other people are running it and you got to retain the people, keep them motivated and make sure they have a reasonable effect going forward.

Hitesh Oberoi — Co-Promoter and Managing Director

Also, it depends on the maturity level of the business. If the — these businesses, at the end of the day, both Aisle actually and Coding Ninjas are still tiny businesses, right? So — and we don’t think we can sort of take them in right now and scale them 10x or 20x from here, because I don’t think we have the management to do that. And therefore we would want the founders to stay motivated and keep working on these verticals for a while.

Ankur Rudra — JP Morgan — Analyst

I appreciate the color. Thank you so much.

Operator

Next question is from Abhishek Bhandari from Nomura.

Abhishek Bhandari — Nomura — Analyst

Thank you, Vivek. Hitesh, if I look at the Shiksha’s presentation, I’ve seen EBITDA loss compared to the usual quarterly profits and also the sequential drop in revenue seems to be very high compared to your prior periods. So maybe you could explain what’s happening in that business.

Hitesh Oberoi — Co-Promoter and Managing Director

Two, three things. See, partly the education season has been weak for the last few years because of COVID. So lot of Shiksha revenue depends on when sort of universities take in students. And that maybe shifting a little bit. Partly it’s also that we are investing little more than we were earlier in our study abroad business. So we are ramping up headcount in the study abroad business. And that period has a cycle, certain sort of — you first hire people, then you counsel people, they are counselors, mostly you hire counselors. And then schools counseled over a period of few months and then they end up in a foreign university and after a while you realize that revenue. So, partly it’s that as well.

Abhishek Bhandari — Nomura — Analyst

So do you expect this to come back to EBITDA positive in the coming quarters or do you think this trend could continue with your investment for some more time?

Hitesh Oberoi — Co-Promoter and Managing Director

See, we were making a tiny profit. It’s not as if we were making a lot of money. I think our focus right now in Shiksha is to grow the business and to add sort of more verticals to the business. We are not so fussed about making a profit in Shiksha in the short-term.

Abhishek Bhandari — Nomura — Analyst

Yes, thank you, Hitesh. Hitesh, I think this question was asked, but could you give us some markers around your progress on your new strategy around the matrimony business? You spoke about traffic improving, but healthy user engagement increased. Are there recent metric to fairly verify those higher traffic is eventually going to help us?

Hitesh Oberoi — Co-Promoter and Managing Director

Yes, so on the traffic side, we are not — we’ve seen serious gains. We’ve increased our share in almost all the markets we operate in. We have many more sort of people registering on our platform. They are spending more time on the platform. They are — we are enabling more matches and hopefully therefore more marriages. So on — we are very happy with the progress we’re seeing on these metrics. Revenues are down by design. Our belief is in long-term if the share converts we will ultimately sort of convert it into revenue market share as well. Of course, we may have to discover new ways of monetizing going forward. We also believe that in the long run the proposition may help us sort of lower our marketing cost as well. But that has to — I mean, it have to seen how that — how this plays out. We will probably have a much clearer picture to present to you maybe in March — by March, April.

Abhishek Bhandari — Nomura — Analyst

Sure. Thanks, Hitesh. Hitesh, my last question is on your core recruitment business. So we have already proven the business very well in India. We understand the IT, ITES market very well. Do you think time has come for us now to start thinking about maybe expanding to similar labor supply zones maybe like Eastern Europe, not now but maybe from a medium-term perspective or some other countries where we could use our relationship with the existing IT companies and help them recruit there?

Hitesh Oberoi — Co-Promoter and Managing Director

Honestly, that’s not our focus at this point in time. We think India is a large enough market and the Indian market is likely to grow well going forward. Strategically, we’ve been adding more services to our offering, so that we can take a larger suite of products. For clients in India, we are still a very small share of the wallet. We still get very tiny proportion of what they spend on recruitment as a whole. And as far as going international sort of — so international, you see what we’ve also learned over time is very hard to displace number one player in any market, no matter how small or large the market is. And therefore if we have to go overseas, we will have to do acquisition. So — and would we go overseas just to sort of help IT services companies hire more IT professionals, unlikely.

Abhishek Bhandari — Nomura — Analyst

Got it. Thank you, Hitesh, and all the best.

Hitesh Oberoi — Co-Promoter and Managing Director

Yes. Thanks.

Operator

Next question is from the line of Aditya Chandrashekar. Aditya, kindly go head.

Unidentified Participant — — Analyst

Yes, hi. Couple of questions from my side. Firstly, on the recruitment business. I think you had mentioned this in a previous question, but just to understand better, can you give some color on how these contracts are structured in terms of the time period etc., because just to understand what kind of a lag we can expect? For example, if IT hiring slows down, now it’s not like IT companies are going to immediately modify or cancel a one year contract, as you mentioned earlier. So just to get a sense of what kind of lag we can expect if there is a slowdown. Is it on an average a six month contract or it’s more skewed towards one year, just to get some sense on that?

Hitesh Oberoi — Co-Promoter and Managing Director

Chintan, do you want to take that?

Chintan Thakkar — Director & Chief Financial Officer

Yes, sure. So we follow a subscription model. And actually just to clarify, we don’t have cancellation type of clauses inside the contract. Most of the contracts, the collection is for the entire tenure has been kind of collected in advance. And yes, I think the clients who are us throughout the year, they renew year-over-year, these are all the clients who kind of typically subscribe for 12 months. So we would have more clients with 12 months at the higher end. At the bottom, you’ll have clients who may need us for let’s say month or two months or three months for some short-term hiring. They may not come back on this platform for quite some time. So most of them are [Indecipherable] type of contract collected in advance and there are no real cancellation clauses in the contract.

Unidentified Participant — — Analyst

Got it. So it’s not like the company’s make very quick short-term decisions, right, even if there’s a slowdown for a couple of quarters, they probably just let the contracts go on?

Hitesh Oberoi — Co-Promoter and Managing Director

Yes. That’s been the behavior in the past.

Unidentified Participant — — Analyst

Got it. And secondly, just a very top down kind of your view on what you think is the end game on the property side and the matrimony side. Is the end game consolidation or to kind of bring maybe two strong players or you think these are markets that can support three or four players, maybe each focusing on a niche market or maybe a particular geography? It’s like how do you see this kind of shaping up because competitive intensity does seem high and everyone’s spending on marketing. So where does it all lead to finally, just a top-down kind of how you think about it? Yes.

Hitesh Oberoi — Co-Promoter and Managing Director

See, of course if there is consolidation, it is likely to result in better pricing and lower marketing costs. But there are just a handful of players in every market and a lot will depend on how the people at the top in these companies think. Clearly there is — in the past, we’ve seen if there is one dominant player, it’s like there is — it’s possible to make a lot of money in the — in any market. If there are three or four, five players, then ultimately that results in consolidation and no market can support three or four or five players for very long time.

Unidentified Participant — — Analyst

So anything on the horizon or it’s difficult to kind of say in terms of consolidation, nothing seems…

Hitesh Oberoi — Co-Promoter and Managing Director

Nothing is on the horizon. There’s nothing which is likely to happen in the next two, three months as far as we know. What — I mean what shape or form things will take the next two, three years, hard for me to say at this stage.

Unidentified Participant — — Analyst

Got it. Okay, thank you and all the best.

Operator

Next question is again from Vivekanand. Vivek, you can go ahead.

Vivekanand S. — Ambit Capital — Analyst

Yes, thank you for the follow-up opportunity. So Sanjeev and Hitesh just couple of questions on the investments. Do you have earmarked amount for these strategic investments that you are doing and follow-on rounds for your investees that are there on the balance sheet like ShopKirana or Sthira? [Phonetic] That’s question one. And second one, Sanjeev, any update on the conditions under which you would consider part monetization of Zomato or PolicyBazaar, the lock-ins are not there anymore? Thank you.

Sanjeev Bikhchandani — Founder and Executive Vice Chairman

Yes. So I’ll answer your second question first. I think, first of all, why would we sell. We would sell if we need the money for some other purpose. We would sell if we wanted to give back to shareholders immediately. We would sell if we believe the future is not bright. I would imagine we would sell under these three circumstances. While this issue is constantly open at our Board level, there’s nothing that currently gives us the indication that either or — any of these three conditions are operating. But like I said, it’s always open for discussion and we are flexible. Okay.

Now as far as budgets is concerned, we sort of keep on estimating how much money we will need going forward, but opportunity arising. As of now, compared to what our treasury is, it’s not putting a strain on it, either the strategic investments or the follow on rounds in the financial investment from the balance sheet. The real issue is, what is the need of the company and whether it’s worthwhile backing it further. So do we have this overnight budget. You see one danger of having a budget — I have seen other companies where I have observed a work, a budget becomes an entitlement. And that is not a great thing. So we will obviously be open. We will look at opportunities and our willingness to go to slightly higher number in strategic opportunities because they strategic maybe slightly higher.

Vivekanand S. — Ambit Capital — Analyst

Sure. Sanjeev actually the question was in the context of the earmarked amounts that you kept for the EIF. So I was asking more from that standpoint.

Sanjeev Bikhchandani — Founder and Executive Vice Chairman

So look, EIF, we don’t want to — see, we got a lot of money in treasury compared to what we are actually investing, but the truth also is that if you earmark too much money to invest, you end up burning a hole in your pocket. Because you are tempted to deploy too much because every opportunity looks good. If I look at the kind of funds — we see funds that have delivered great returns even in the U.S. They usually are not very large funds, USD150 million to USD200 million, USD100 million. To go beyond that right now at least I am personally a little uncomfortable. It’s good to be little tight for money as far as the investing team is concerned.

Vivekanand S. — Ambit Capital — Analyst

Makes sense. Thank you so much for the detail.

Sanjeev Bikhchandani — Founder and Executive Vice Chairman

This is our current thinking, of course things could change, but it is the current thinking.

Vivekanand S. — Ambit Capital — Analyst

Sure, thanks.

Sanjeev Bikhchandani — Founder and Executive Vice Chairman

Hitesh, do you want to add anything?

Hitesh Oberoi — Co-Promoter and Managing Director

No, it’s fine.

Operator

The next question is from the line of Amit Chandra. Amit, you may go ahead.

Unidentified Participant — — Analyst

Yes. Hi, sir, and thanks for the opportunity. So all the questions have been answered, so I just have one question is on the recruitment business. So we have seen the recruitment margins expanding consistently from 55% to now 61% roughly. So in the context of the slowdown we are seeing in the IT side, so can we see the margins heading back towards the pre-COVID levels or is it more sustainable at current levels, the margins in the recruitment business?

Hitesh Oberoi — Co-Promoter and Managing Director

No, see, what I’ve said in the past and now that the market is getting back to normalcy, if we continue to grow our Naukri billings by 15%, 17% per annum or 15%, 20% per annum, we should be possible to sustain these margins. If there is a serious down in billing contracts or for some reason or we are single-digit billing growth, then of course margins may shrink going forward. So it all depend on how things play out in the next — how sort of revenue growth — billing growth rate plays out in the next few quarters.

Unidentified Participant — — Analyst

And any color you can provide on the margins or maybe realizations in IT and like non-IT and how it has panned out in the last few quarters?

Hitesh Oberoi — Co-Promoter and Managing Director

Sorry, can you repeat that? How margins have panned out?

Unidentified Participant — — Analyst

So the margin differential between IT and non-IT.

Hitesh Oberoi — Co-Promoter and Managing Director

So we don’t track and report margins by segment right now. But I suspect IT margins are better than non-IT margins, because our billing per customer in IT is higher.

Unidentified Participant — — Analyst

Okay, sir. Thank you. Non-IT, yes.

Operator

So this was the last question, Hitesh. With this, we would like to conclude this conference. Thank you, everyone, and you may disconnect your line, please.

Hitesh Oberoi — Co-Promoter and Managing Director

Thank you, everyone, and have a great evening.

Operator

Thanks. Good night.

Hitesh Oberoi — Co-Promoter and Managing Director

Thanks.