Ladies and gentlemen, good day, and welcome to the Just Dial Limited Q3 FY23 earnings call. At this moment, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. At that time, you may click on the Raise Hand icon to ask a live question. Please note that this conference is being recorded. We have with us today Mr. V.S.S. Mani, CEO and MD, and Mr. Abhishek Bansal, CFO. I now hand the conference over to Mr. Abhishek Bansal, CFO, Just Dial Limited. Thank you. Over to you, sir. Thank you, moderator. Hi, everyone. Welcome to Just Dial's earnings call for third quarter of FY23. Our operating revenue for the quarter stood at INR 221.4 crores, witnessing 7.9% sequential growth and 39.3% on a year-over-year basis. YoY growth being higher due to COVID impacted quarters in last fiscal. Our adjusted EBITDA, excluding ESOP expenses, stood at INR 29.4 crores, representing an adjusted EBITDA margin of 13.3%. Our employee expenses have increased 29% on a year-over-year basis, led by 39% year-over-year increase in head count across sales, technology, product, content and marketing functions. On a sequential basis, employee expenses were relatively controlled at 3.3% quarter-over-quarter increase versus headcount increase of about 2.2%. Our advertising expenses for the quarter stood at about INR 5.7 crores. Other income stood at INR 71.3 crores for the quarter. Last year same quarter had lesser other income due to rising bond yields impacting MTM gains in that quarter. Profit after taxes stood at INR 75.3 crores, representing a growth of 288% on YoY basis and about 44% on sequential basis. During the quarter, we signed up about 66% customers on monthly plans and 3Q collections stood at about INR 245 crores, which was up 6.3% sequentially and 63% on year-on-year basis. Monthly ECS collections, which is money received from direct bank debits for our monthly plan customers, that contributed about INR 124 crores, almost half of our quarterly collections. The same witnessed about 9.7% quarter-on-quarter growth. Active paid campaigns at the end of the quarter stood at about 522,000, which was up 19.3% YoY and 3.6% sequentially. Paid campaign addition of about 18,000 campaigns for the quarter, despite a festive quarter, which tends to be a bit softer, suggests a healthy trend. Deferred revenue stood at about INR 402.4 crores, which was up 6.3% sequentially and about 23.6% YoY. Overall ramp up in sales hiring is yielding good results. We expect momentum to very well sustain in fourth quarter as well. As far as margins are concerned, we are also on an improving trajectory. As we have mentioned earlier, most employee costs hit our PNL immediately, but corresponding uptick in revenue recognition happens with a lag as services are rendered. With top line growth coming back, operating leverage benefits are also visible with margins expanding. Our cash and investments stood at about INR 3,934 crores as on 31st December. Coming to operational highlights, traffic stood at 156.8 million unique users for the quarter, growing 9.8% year-on-year. About 86% traffic comes on mobile platforms. However, with our new website, which has significant changes over the previous version going live, desktop traffic too should see uptick going forward. Total listings in our database stands at a staggering 35 million as on December end. Several user-friendly features are getting added to our platforms, which should help improve user engagement going forward. Overall, as you see, we see the core business coming back on track. Revenue and paid campaigns are now very close to pre-COVID levels, the gap should get bridged shortly, as we have mentioned in last couple of quarters too. Our realizable value, which is money that we expect to receive in next one year from sign-ups that we did in last quarter was again healthy at about INR 260-INR 265 crores. Slight sequential impact due to festive month, which was anyway expected. Overall, top line has decent visibility of growth since collections at INR 245 crores are higher than revenue and the realizable value is higher than current run rate of collections. With this broad update, we shall now open the floor for questions and further discussions. Thank you. Thank you very much. We will now begin the question-and-answer session. To ask a question, please click on the Raise Hand icon available on the toolbar, or you may click on Q&A icon to raise hand. The operator will announce your name when it is your turn to ask a question. Please accept the prompt on your screen and unmute your microphone while proceeding with your question. We will wait for a moment while the question queue assembles. We have our first question from the line of Amarnath Bakut from Ministry of Finance of Oman. Please go ahead. Yeah, hi. Am I audible? Yes. Yes, please go ahead. Yeah. I just want to know this cash level which you are holding at the moment, close to INR 4,000 crore. What's the plan for this utilization? Because your capital requirement anyway is very less. How this cash is going to be utilized? Any plan for it? Amanat, the INR 3,900 crore cash we have on our books, out of this approximately INR 1,500 crores we had prior to our strategic tie-up with the Reliance Group and another INR 2,165 crores got infused as part of that particular strategic deal. At this point of time, one, we are focusing on our core business, which anyway is free cash flow generating. At the same time, there are certain new initiatives that we are pursuing. As you would appreciate, we operate in a very sort of disruptive sector, so to say. A part of this particular cash could get utilized in future towards promotion of our new initiatives or if any other inorganic opportunities come along. At this point of time, we are ensuring that we get our core business back on track and utilization of this particular cash on the balance sheet. Obviously, we will take stock as our new initiatives unfold. Company, as you correctly said also, this is a cash generating company. The utilization of the cash to, for your core business is really very limited. After the Reliance money came into the business, and these are... it's become a kind of an investment company, you know, that managing the treasury, getting the return which is much lower than your business returns. Actually, it is hampering your return on capital employed on an overall business basis. Even if your business is growing high because of that cash level, your ROC is getting contracted a lot. Unless you find out certain fruitful way to utilize this cash, maybe an inorganic or whatever, company thing here, this will become an overhang for your return on capital, isn't it? Yes, you are right that at this point of time the major chunk of cash that sits, that earns about whatever 7.5% kind of yield. At this point of time, as I said, there are certain new initiatives in pipeline. Once we proceed over next few quarters, the company could sort of reassess the best utilization of this cash. At this point of time, we are ensuring that we don't do anything silly with this cash, so to say. And at the same time, whatever returns could be maximized on this particular treasury in the safest possible manner that is being done. If I could add to this point, you know, Abhishek? Yes, please go ahead. Yeah. When we were doing the deal last year with Reliance, we were around that time we were just limping back from COVID related disruptions. Our goals are much more ambitious and Reliance, with the Reliance strategic investment, our idea is to enter into many value-added fields. We felt at that time there is a need for capital and that's how the money was infused into the company. This quarter, if you see the last quarter, our strategies have yielded good results. We decided to focus on our core business, which is local search, you know. Because it was mission critical for us to put our systems in place, you know, to overall see performance take off, you know. Because we have been highly profitable company. Yes, you are right, when with all this new money into the company, there is going to be a challenge on return of capital. You don't want to make harakiri by throwing the money into some random business to acquire something. I strongly feel, with my 20 years, 25 years of experience in this business, the core business has tremendous strength as a high cash flow, free cash flow business. If we just stay focused for the next couple of quarters, we will see a huge return on existing, I mean, huge return in terms of profitability. Yes, it will no may be measurable to the capital that we have. We kind of rethink on our strategy. Not rethink, and fine tune and see what are the new opportunities. That's how we are thinking right now. It's important to keep our customers happy, the advertisers happy, you know. As you can see, this quarter we have grown our customer base by 25% from last year. Overall the business is in the right trajectory. These are technical points that you raised, you know. I would say gradually we'll address these issues. Yeah. It is better to have a lot of cash in the books than not have debt in your book. Yes. No. Both the sides, too much is not good. That is what, things are happening. Other side, when we think the company- I agree. has too much of Yeah. That is a problem. Too much cash without 7%, 8%- I agree. getting when business is having 25% kind of ROCE is just diluting raw ROCE. Anyway, I have just two more strategic question. Operational things is very clear from your presentations as well as the business understanding. I have two more strategic questions. You are developing so many products, two or three products are on the line. Right. Which might be implemented or commercialized maybe another 2, 3 quarters on the line. I'm just trying to understand the product what you are developing, it is already there in the market in some form, whether it is travel-related, whether it is business-to-business related, whether it is some product is already there in the market. I'm just trying to understand what Just Dial is trying to do to differentiate its product from what already in place, whether it is Google for search engine, whether it is IndiaMART for the B2B business, whether it is travel-related, hundreds of different kinds of platforms are there. Are you doing something which will differentiate yourself so the people will come to you, not to others? Okay. Let's understand our business. Our business is to help small businesses get customers, okay? Which has been for the last 25 years. How we have been doing it, we have given that one point access to prospective users who are buyers who could find and discover and eventually find the right vendor for what they're looking for, and thereby we have been benefiting, you know? That model cannot change. That remains that. Justdial will continue to be a platform which will co-generate quality leads for businesses. The big differentiator between us and the other players is in our case, when a small or medium businesses or any business or service or whatever will get acquired customers, that customer brings to them some. There is a lifetime value opportunity with that customer. Other than most other platforms where the customers are owned by the platform, these businesses happen to be just suppliers. Mm-hmm. If you think about every small business want to become a medium-sized business, a medium-sized business wants to become a large sales business one day. They have to continue to have their own customer base and grow that base. Justdial plays a very important role in that. Now, for overall user experience, we may have to mimic some of the products features which are there in various verticals. Because as a horizontal, Justdial give a unique proposition, which is that you can find local vendors, you know, in your neighborhood vendors for your products and services that you're looking for. In most cases, you will find names that are familiar to you, and you will be far more satisfied, you know, buying from those familiar names. And now that the price difference is narrowing down between online and offline and all that, then the obvious loyalty, or rather not the loyalty, the faith is more on local vendors that I know of. But if I have a platform like Just Dial through which I can access those vendors and as a user, I'm saying, "Oh, I would prefer that." Now, why? Well, in that access should that have ability to transact online, should that have ability to fix an appointment online, should that have ability to place an order online, that only then the platform becomes relevant. Whatever we are doing in terms of product improvement features and all that is only fine-tuning to make it up to date. The basic principle of being a bridge between the buyer and the seller remains. Our job is to continuously help small and medium businesses grow their customer base. In that process, if there are requirements to have certain features, that is what we are working on. This association with the Jio, you know, the market looking at Just Dial is not just a Just Dial. At the moment, we are all looking at the Just Dial is a part of the Reliance group. Right. Jio is with its vast kind of a network which they already built across India, how that is coming to JustDial as a strategic thing which will give them a competitive edge over any other competitors available in Indian market? This is exactly my question. I just try to hint directly to the point. How that Jio association. Jio is your owner of the company. Right. Right. When Reliance buys something, they doesn't buy for a small thing. They buy something for a huge kind of an growth outlook for over a longer period of time. Right. Try to understand how that is a competitive advantage for you. Okay. First is there are certain natural things that come with the Jio partnership. You know, Jio happens to be the largest cell phone provider in the country, almost in numbers. Now the business contact details, business data that comes to Jio directly flows on to Justdial, and that's further strengthening our database in terms of listing small and medium businesses from the length and breadth of the country. The second thing is, if you look at, you know, there are retailers which are, you know, Jio partners. They also automatically come to our platform, and thereby we are able to enrich our content as well as our vendor base. The third, of course, integrating Jio, Reliance SMART stores and platforms and all that. Let us tell you about the original thinking behind this strategy was how to get. There was a kind of regulatory thing that was happening where actually, the government wanted to differentiate between a, you know, a platform which is, you know, so what do you call, third-party marketplace, different from first-party marketplace. Somehow that regulatory reform has not happened right now. We have plans in place where the original plan was Justdial becomes the third-party marketplace, which is like the vendors are any of the local dealers and local manufacturer, whatever it is. You directly as a customer buy from those pick and choose of vendors. The other model was like a warehouse-based model where it was first-party marketplace. Basically, you then directly buy from a Reliance JioMart or Amazon or whatever it is. That, since that change has not taken place and there's no immediate, you know, plans to do that, we said we would rather focus on our core business, more particularly because the core business was really hurt, you know. Yes, you will see in due course of time what you said precisely will happen. The big plans, the big picture, we know it's not gonna be a small business, but with the right time, you know, this will happen. Thank you very much. I will join the queue for further question. Thank you. Thank you. Thank you. We have our next question from the line of Nikhil Choudhary from Nomura. Please go ahead. Hi. Can you hear me? Yes. Yes, please go ahead. Thank you for giving me opportunity and congrats on good numbers. Just one thing I want to understand, especially related to intangible under development, how that is progressing. Are we still capitalizing at the same run rate, and how long do we plan to do that? Is it going to be in next FY24 as well? When do we expect that capitalization to hit our income statement? Basically, when we are thinking of monetizing those assets, all three, JD Express, JD Expert, and JD Commerce and JD VRT. Just want to understand the dynamics of that particular part. Thank you. Nikhil, the capitalization during the quarter was about INR 5 crores, taking the total capitalization to about INR 27 crores. These projects, the way it have works is that they are built in a phase-wise manner and as and when a particular phase gets completed, that particular phase starts getting depreciated in PNL over the estimated useful life of the asset. At this point of time, I think, sometime in, possibly in, say, first quarter of next year, some of these particular existing capitalizations should start getting expensed over useful life of whatever, two to three years. Understood, Abhishek. Thank you and good luck for next quarter. Thank you. Thank you. We have our next question from the line of Mohit Motwani from Nomura. Please go ahead. Hi, thanks for the opportunity. My question, Abhishek, is on the paid campaigns addition. You have been doing a lot of good paid campaigns due to the monthly payment plans. Now just wanted to understand, are there any 3 to 4 verticals, you know, which are actually helping you know, grow your paid campaigns very heavily? Are there 2, 3 verticals that you want to call out? Just wanted to get some insights on that. Thank you. Mohit, paid campaigns even historically for us, no single vertical, so to say, contributes more than 4%-5% of our revenues. Even now in terms of recovery that we are seeing, it is extremely broad-based. Paid campaigns and realizations are hardly 2%, 3% short of pre-COVID peak numbers, and that gap should get bridged very shortly. The good part is that both geographically as well as in terms of type of businesses, there is a broad-based recovery. Thanks, Abhishek. One more question. Just wanted to understand, you know, the paid campaigns that you have added in the last few quarters, which are mostly on monthly, 70% were on monthly, what kind of renewals have you seen in these in these additions? Can you give some color on that? Most of these particular monthly plan sign-ups that we do, they in a way sort of get auto renewed. At this point of time, of the overall total paid campaign base that we have, now about 55% of those particular paid campaigns are monthly plan basis. In fact, the key advantage with monthly plans is that it obviously is much more affordable to the customer. There's a every month payout that happens instead of a chunky payout, and that is how it works. Sure. Thanks, Abhishek. Thank you. Thank you. We have our next question from the line of Rishit Parikh from Nippon India. Please go ahead. Hi. Am I audible? Yes, sir. Sure. Hi. Thanks, thanks for the call, right. I just had 2, 3 questions. Abhishek, I just want to understand. We've hired a fair bit of people in the last, I think 3 to 4 quarters, right? In especially in the sales side, right. Just wanted to understand 3 things there. One, what are the hiring plans? Second, how do we measure the productivity of these employees? Essentially, do you think we're operating at an optimum level in terms of productivity or there's more to be done going forward and hence a lot of these, you know, employees will be more productive going forward and we don't need to hire as much? Rishik. I have a follow-up. Yes. On hiring plans, you would see that the first three quarters or maybe say, first two quarters of this year, the majority or bulk of sales hiring happened. Last particular quarter, overall headcount of the company has increased by only 2.2% only. I think the way we are looking at it is that since there is more reception of our particular product, even after taking bit of price hikes. We would want to sort of, in a calibrated manner, keep hiring, keeping next 2-3 fiscal years in mind. Having said that, the current sales trend that we have for the same tenure, productivity levels are already higher versus pre-COVID productivity levels. For the staff that got hired in last two to three quarters, they would definitely start yielding much better results after they become, say, six to nine months tenured. For next, couple of quarters, two, three quarters, whatever internal targets that we have, the existing sales strength itself should be able to cater to it. Since we are seeing decent uptick in terms of productivity, so we might want to continue hiring at a calibrated pace, not as aggressive as we did, say, in last three to four quarters. Okay. Just wanted to sort of understand on the outlook perspective with what you see in the market, right? Is there over, let's say, a 2-year period, 3-year period, do you think you can continue the same pace of paid listing addition or this is just some of the one-off gains that you lost in COVID and that's come back? If you see now for last, sort of, 3, 4 quarter, 3 quarters, we have been adding 18,000-20,000, 21,000 paid campaigns every quarter. In fact, the current running quarter, we intend to take our monthly plans up from even 70%-80% or even higher. The idea is make it as affordable as possible for the SMEs. The way you can say that in a mutual fund industry you have that SIP book. In a similar way, we would want SMEs to sort of see their particular INR 1,500, INR 2,000 spend on Justdial as a mandatory spend for their particular business. Yeah. Good. Good. Since we are seeing a positive response on that, I think paid campaigns should keep trending upwards. Again, going forward, whatever revenue growth that we will target, internal target would be half of the growth should materialize from paid campaign growth and rest half should be. We should be able to take corresponding price hikes. That is what demonstrates. Right. The true potential of the product. You have to understand opportunity is different post-COVID. You know, post-COVID, small businesses and medium businesses are now realized digital first should be the strategy, not like traditional media. Traditional platforms are now getting second priority. Hence that priority shifting to digital first, we are going to be one of the beneficiaries. That's because of that we are able to price it, you know, better and we are likely to get more number of customers, you know, advertisers. This probably explains to you that in the next probably 2 years we see continuous growth both in the number of customers and unique customers and as well as average ticket size. Sure. That is very useful. Can I ask one more question or should I get back in the queue? Sure. Sure. Sure. Okay. Go ahead. Just on the newer initiatives, right? I think. Could you just help us understand where the progress is today, broadly? Is there a timeline that is sort of useful for us to monitor the progress or the launch deadlines, let's say over a year or two-year period? I'm not asking for a specific quarter, but again, anything just to understand how should we look at it. JD Xperts, the pilot has been very successful. We are all set to, you know, accelerate, probably hopefully by the end of next quarter we should be, you know, full-fledged, you know, accessed by people, users from multiple cities. Regarding Jd Mart, there are certain important feature development and all that being done and there is a renewed focus from the management team, and you will see that proofs of that also shaping up around the same time. As far as JD Shopping is concerned, as I explained to you, that project we didn't want to prioritize, although we invested a lot of money and resources in it and we continue to capitalize it. We just want to delay the launch because there is no immediate urgency to get that rolling, you know? Which is the shopping thing. Because of the 3P, 1P marketplace, you know, confusion that existed before, it's no more there. As a group, you know, as a Reliance company, we said, like, you know, let Just Dial focus on all the core services and B2B activities and then look at shopping as a last priority. See, also just to add one point here. On JD Shopping, the way ecosystem is shaping up, so suppose you sell a 100 rupee product on your platform. Your commissions broadly are in the range of anywhere 7%-8% on an average, depending on which category you operate in. Now, we did certain pilots and ideally as a business I would want all my expenses, including my performance marketing spend or any advertising spend to be curtailed in that 8%, so that over long run it becomes a healthy unit economics business. At this point of time, for us that seems sort of difficult basis whatever pilots we have done. We see that others in the industry are also obviously unable to operate on a positive unit economics. Consciously, we want to be sure that we don't end up spending. You can spend tons of money, end of day, you will not have that much sticky users. We want to be sure that we keep improving our platform and at the right time do those particular spends to scale up for traffic. I thought, we'll add this. That's right. No, that is very useful. Yeah. Thank you so much. All the best guys. Thank you. Thank you. Thank you. Participants, to ask a question, please click on the Raise Hand icon available on the toolbar, or you may click on Q&A icon to raise hand. We have a question from the line of Vivekanand Subbaraman from Ambit Private Limited. Please go ahead. Mr. Subbaraman, please unmute your audio and go ahead. Please unmute your microphone from the toolbar. Since there is no response, we'll move on to the next question from the line of Hemal S, an individual investor. Please go ahead. Yeah. Hi. Can you hear me? Yes. Hi. Just have 2 quick questions. Maybe I just joined the call late, maybe you already addressed it. What is the total collection amount? Every quarter you used to give the collection amount. What was the collection amount this quarter? It was INR 245 crores. What was it last quarter? Last quarter was about INR 230 crores, and same quarter last year was INR 150 crores. Okay. Quarter-on-quarter, I'm seeing like active paid campaigns and, you know, growth slowing down. Is that a concern for you or is it just the seasonality, or is that not a concern for you? We added about over 18,000 campaigns. As I mentioned in my opening remarks as well, October, which was a typical festival month. Part of the additions that were lesser than, say, 20,000 run rate was attributable to that particular month. Overall, the exit run rate was quite healthy. I think as we go into future quarters, we should continue to see healthy additions. Festive seasons like, you know, Dussehra and Navratri, Dussehra, Diwali is usually the lowest ever month for Justdial, you know, in the 12-month calendar year. That's when the both acquisition of customers and revenue dips, but then it picks up. Usually the March, the last quarter is the best quarter. One clarification. Thank you for that clarification. One more is when you say unearned revenue INR 402, the way you would explain 2 quarters back is what you see this year is generally what you should expect 6 months down the line. Is that still accurate? Is that my understanding accurate? It's actually a 12-month down the line, I think, or so, right? Yeah. INR 402 crores is advances that I have received from my customers for which services are yet to be rendered. This INR 402 crores, the average amortization schedule could be, say, around 8-9 months. Over next 8-9 months, this INR 400 crores will get accrued. Having said that, in those 8-9 months, I will also sign up customers and get collections. A part of it would obviously get accrued in that period also. This quarter's INR 221 crores, part of it came out of unearned revenue as on 30th September, and part of it came from fresh collections that I received during last particular quarter itself. Got it. Absolutely final. Since we have such a large cash amount, is it what is an average yield that we should expect for FY 2024? Like, I know it's published, but I'm just- About 7.3%. Portfolios yield to maturity at this point of time is around 7.3%. 7.2%-7.3%. Okay. We can say the duration around five years, is that what you? No. We operate at a duration of about 3.2 years, primarily because all mutual fund investments become tax efficient as soon as 3 years are crossed. Okay. perfect. Thank you. I appreciate it. Thank you. Thank you. We have our next question from the line of Vivekanand Subbaraman from Ambit Private Limited. Please go ahead. Hi. Thank you for the opportunity. I have two sets of questions. One is on operational numbers and financials. Abhishek, need your help on the split of the revenue and campaigns, top 11 versus rest of the market. That's one. Second, if you would help us with the ANP and the guidance for FY23 and FY24. Last financial question is on the estimated realizable value of collections. I think now that, you know, 70% of the collections are for monthly campaigns, you know, how do I make it equivalent to what you were reporting pre-COVID? Last question is on a slide that you have put this time on enhanced analytics for customers. Here, what exactly are you doing and, where have you progressed in this regard and, how will this help you know, in your business and monetization? Thank you. Okay. Vivek, on your first query, top 11 cities, they contributed about 62% to revenue and 42% to paid campaigns. Essentially ticket size in tier one is higher than tier two, tier three. That is why higher contribution by value, lesser by volumes. ANP guidance. In a steady state, we would want to spend, say, around 6%-7% of our top line on advertising spends. This particular year, we spent more on ramping up our particular sales teams, et cetera. Part of those spends got offset by lesser AMP spends. Having said that, pre-COVID, we used to get about 158 million-160 million quarterly users with about INR 18 crores of quarterly spend. Right now, last couple of quarters are being at about INR 156 million or so, with just about INR 5 and a half crores of quarterly spend. net-net, AMP spends can be ramped up at any point of time. For next year, as I said that I will budget in something around 6%-7%. On your third question around the estimated realizable value. last quarter, it was about INR 260-265 crores, very slightly short of INR 270 crores the previous quarter. The way we look at realizable value is that this is my current estimation, this is the amount of money that I should ideally be receiving in next one year from my customers, and this will keep backtesting over our historic data. Whatever I had estimated last year, same quarter, I did almost end up receiving that much amount over the next 12 months. Pre-COVID, this used to be peak of about INR 235 crores or so. We are about broadly 15%-18% higher versus Pre-COVID levels. Certain months are even higher versus 20% higher versus Pre-COVID. On your query around enhanced analytics. When we run campaigns for our customers, we try our best to give them visibility on how their campaign is performing, so they get visibility in terms of their listing showing up, searches happening for their particular specific listing, for their category, clicks happening, calls coming to them, requests for quotes going to them. This particular analytics section gives them complete visibility on how their campaign is performing on a monthly basis, et cetera. We have added new features, such as giving SMEs ability to sort their particular leads by relevance, sort their leads by recency, trying to give them as much control as possible on their particular campaign so they can make best use of whatever visibility that we provide them. Over time, this simplicity and being able to track performance of their campaign directly correlates with how my renewals pan out, how my customers perceive ROI from my platform. Okay, makes sense. Abhishek, thank you for the, for all the answers. Just one follow-through. The realizable value of collections is INR 260 crore-INR 265 crore in three Q. Would you be able to help us with the number for the last 12 months? You know, this migration to monthly packages has been underway since the, you know, COVID recovery. I'm just trying to understand- Sure. Because the reported numbers are still lower than COVID, but, you know, in FY24 you may suddenly have a sharp jump in revenue, you know, basis what you just commented right now. For first nine months of this year, first three quarters, realizable value was broadly around INR 765 crores-INR 770 crores. I tend to give a range because it's an estimate. INR 765 crores-INR 770 crores and the same for first three quarters of last year was about INR 435 crores-INR 440 crores. INR 435 crores-INR 440 crores. Okay. Last year, obviously, there was significant impact of COVID in first one or two quarters. Right. Essentially, Abhishek, if we end up with, let's say, realizable value of collections, broadly, similar to what we saw in 3 Q, is it fair to assess that the fiscal 2024 revenue number will be INR 770 plus INR 260, so around INR 1,000? I'm just trying to understand because, you know, the percolation to revenue, has been, you know, difficult for us to model. Okay. technically, if I were to understand, see, whatever I will sell in next particular quarter, those customers will pay me the signed amount over a period of next 12 months. Okay? Yes. Whatever that particular money comes in will get accrued over their respective tenures. It might not one-on-one correlate. The first 9 months amount, yes, with great certainty I can say that, yes, that will only get accrued as revenue in fiscal 2024. For last 3 to 4 months, a part of it could sort of spill over. Okay. Understood. This is very helpful. Thank you and all the best. Thank you. Thank you. We have our next question from the line of Rupesh Satia from Intelsense Capital. Please go ahead. Hello sir, can you hear me? Yes, please go ahead. Yeah. I am relatively new to the company, so, some of the questions might be slightly basic. My first question, sir, is, I mean, do you have a margin guidance for us, let's say in FY 2024, or when we can get back to, let's say, pre-COVID margins and how do we get there? In terms of... We do not per se provide a specific margin guidance. Pre-COVID, we used to operate at around 25%-28% sort of margins. We are obviously coming out of this particular COVID impact in terms of our top line trying to catch up with the pre-COVID numbers. As far as expenses are concerned, we have already made significant investments in terms of ramping up our particular sales team. I think next year, same quarter or thereabout, we should be sort of on a quarterly basis be coming closer to pre-COVID type of margin levels. Or could be slightly earlier as well. Okay. Okay. That is good to know, sir. The second question I have is, like, I think the pre-COVID, your active campaigns were around 520K. I think we've reached that number, you know, in this quarter. This, you know, might be the easy part. I mean, whatever we lost, some of our customers were impacted in COVID, they are now coming back. You have done so much hiring and so much investments into the business, right? You are now saying that we'll grow, pretty much we'll add 20,000 pretty much every quarter, more or less. Plus you will continuously grow now for next, you know, let's say 6-8 quarters. Can you give some, you know, second-level details around that? Still here, I think the journey at least was relatively easy, in my mind. How do we go from here, from let's say 520K to, let's say, 700K in the next 6-8 quarters? Okay. Let us look at it slightly from a top-down perspective. India broadly, basis ministries estimates itself has about 60-65 million small and medium businesses. Another 15-20 million could be freelancers such as gym instructor, yoga teacher, swimming coach, et cetera, which are not technically SMEs, but they are potential listings for us. Broadly, the universe could be, say, 80 million listings. Post-COVID, I would argue that against this particular 80 million listings, for sure, 1% of this particular universe should surely be at least advertising on a platform such as Just Dial. That itself translates to, say, 800,000. My database at this point of time is about 35 million listings. In a steady state, we think that 5% of the database should surely be our particular paid subscribers. That way, that translates to sort of huge opportunity numbers in terms of 1 million+ or close to 1.5-2 million subscribers. There is no dearth of opportunity per se. Good part is that COVID in itself has made SMEs realize that they need to be present on online platforms from there, from where they could get their particular business to get discovered. During COVID, SMEs which had some online presence could still cater to getting some particular consumers, but ones who were completely offline, they do realize that the way it is important to have an internet connection for your business, a telecom connection, similar way you need to be present on an online platform. Plus the average ticket size of INR 18,000-INR 20,000 that we charge annually, that overall we feel is very, very affordable for any small and medium business. It's not an amount which will pinch any particular SMEs affordability. Okay. Okay. I That's clear, sir. The another part of the question is you have, you know, talked about price hikes and let's say, I mean, whatever your first batch of, you know, monthly customers, maybe they are now, I don't know, 18 months old or, maybe more than 12 months old, what kind of price hikes we have been able to, you know, get there? Or if you can talk about behavior of, you know, this cohort in terms of, I mean, they are going into longer plans? Are they converted into ECS? What kind of services they are using? If you can give some color on that cohort, for example. Okay. Even today or even before we adopted this particular aggressive monthly plan strategy, we still had a good chunk of customers who have been paying us on a monthly plan basis for last several years. Why I'm emphasizing this particular point is that for me it is important that a particular customer should keep paying me on a month-on-month basis. I am not that obsessed about getting that extra 10, 12% price hike from that particular customer. In any case, for a digital advertising platform, there will be customers who might choose not to renew on an immediate basis, et cetera. Whatever new customers that are coming in, they tend to obviously face price hikes. Customers who have paid in lump sum, whenever their next renewals are due, they also obviously face price hikes. Overall, the target is that part of the growth on the overall cohort basis should come via price hikes that we can take. I'm not that worried about whether a customer who signed up 15 months ago and they are happily paying me INR 2,200 rupees a month, whether I should work to get INR 2,400 out of that particular customer or not. Okay. I mean, what kind of price hikes we do? 5% or 10%, 15%? Is it what kind of range? Okay. There are two types of listings that we sell. One is the premium listings, other is the non-premium listings. Premium listings are the top fixed positions. If you're searching for, say, dentist in Bandra West, the dentist coming on top, they have typically blocked that inventory for their entire tenure. If 100 searches are happening, their name will come on top position in all the 100 searches. Post those premium listings, rest of the customers get visibility in proportion to the money being paid by them. There is no fixed position. In premium listings, there is a scientific way by which price hike gets percolated. The way it works is that for categories which are seeing growth in traffic, part of the growth in traffic gets percolated as price hike every month. Whenever a particular customer comes up for renewal, say, at the end of their particular tenure, they see a certain price hike. This particular model also helps us to sort of reduce prices in those categories which are not in demand. That way, for particular categories seeing, say, a 10% drop in traffic, we are happy to pass or reduce prices by, say, 6% or whatever part of that growth or degrowth. On the non-premium listings, we take price hikes from time to time, which is where we talk about 12%-15% price hike sometime in second quarter of this particular year. Okay. I see. One small question. I mean, in terms of, you know, sales employees, can you talk about, I don't know, capacity utilization? I know you say that some of these people will start, you know, contributing nine months forward, but in terms of, I don't know, capacity utilization might not be the right word, but you get what I'm asking. Okay. The way we sort of evaluate is, we look at something which is gross margins or gross sort of cost of sales, which is nothing but direct costs associated with sales, such as salaries and incentives that we do our sales employees. At this point of time, we are operating at about 47% being our cost of sales. Pre-COVID, during our best months, we used to operate at about 40% or so. This 48% obviously is higher, partly because there is a significant hiring that has happened. On the financial side, I would obviously want this 48% to go towards 40%. At the same time, as far as potential in terms of output or productivity is concerned, definitely on a overall basis, there is still potential to improve their particular productivity by 20%, 30%, if not more. Okay, I see. The final question, sir, is in terms of, you know, competitive positioning post the, you know, acquisition by Reliance Group. I mean, can you give some color on in certain areas, you know, we have got maybe some areas where we were trying to work really hard in the past, but we weren't able to get success now with the help of Reliance. You know, in some of these areas we are becoming kind of leaders. What are some areas where, you know, there are still kind of areas of improvement? If you can, you know, talk about competitive landscape post Reliance takeover. Okay. there, instead of specific areas, I would say our strength is in being a horizontal. The key strength of the platform is that one place one platform which connects all these small and medium businesses in India. You search for any particular category, you will surely find relevant results. The depth and breadth of results is far superior on the platform. Over last few quarters and in coming quarters, what you will see, the same set of database will have much richer content in terms of you being able to see deals and offers being offered by some of these particular businesses, their particular tariff cards, menus, catalogs. Basically a much more curated content which will enable users to take much better decisions, which particular SME to avail services from and so on. Overall, instead of pre-Reliance or post-Reliance, I would say that as far as core business is concerned, that is more to the strength lies in being horizontal. Very well-oiled sales machinery, the network that we have pan-India. In terms of newer initiatives which pertain to adding a transactional layer both on the services side as well as on the product side, that is where we are working closely with the Reliance team and those particular initiatives are underway. Okay. Okay. Thank you so much, sir, for answering all my questions. Thank you. Thank you. We have our next question from the line of Amarnath Bakut from Ministry of Finance of Oman. Please go ahead. Yeah, hi. I hope I'm audible. Yes, sir. Yes, please go ahead. Yeah. Just 2 small, again, the strategic follow-up questions on this. After Reliance gets into your business as a promoter, now is there any strategic change happened to the business? Say, now they came into of their way of looking at the business might be different than the business style working before that. If you can, help us to understand is there any major strategic outlook change after the Reliance comes to the board? In terms of strategic change, I would say that the key priority was that we had 2 successive years of COVID impact in terms of, say, our top line going down by about 30%-32% versus pre-COVID levels. The clear strategic discussion that we had was that how can we, in this particular fiscal 2023 itself, quickly bounce back to pre-COVID levels. While the PNL revenue will take another quarter or whatever to catch up. The fact that we have been able to cross pre-COVID levels of realizable value, collections at INR 244 crores are anyway higher versus INR 235 crores of pre-COVID revenue. Sorry. I would say I'm not looking at the operational factor. See, whether Reliance is there or not there. The operational recovery post-COVID, it is eventually bound to be happened. That is just a matter of time, whether 6 quarter or 8 quarter or 2 years or 3 years. I'm just trying to understand from a strategic point of view, the way the company was working before Reliance came in and after the Reliance took over the majority stake, of course, there must be something strategical outlook change. That, okay, now the new promoter came, they want that business to be run in a little different way or something in a new direction. I'm just trying to understand that is there any directional change happened in the company after the Reliance came in picture, not the operational part of it. Okay. As I mentioned earlier, the directional change primarily is to say that this particular platform is a search discovery-based platform. Can we add a transactional layer? Things are obviously moving online. Having said that, those particular transactional layer, we are also very clear that we should not be doing something which just results in bleeding off of money because something does not seem to have unit economics in the long run. Some of our newer initiatives are clearly an outcome of those particular strategic discussions, which are to say that add a transactional layer such that SMEs which were getting discovered on the platform earlier, can interactions between the user and that SME also get routed via the platform itself. It is more of an integrated approach rather than a piecemeal approach, probably because now you wanted to have an app which is integrated in nature from top to bottom. Once the SME comes into your platform, they will start from searching up to the end of payment and delivery. Right. in certain categories. And, and- Yes. In certain categories, till the end, in certain categories, it could be enabling digital payments. Even if there is a transaction happening in an offline store, can the payment be collected via a particular platform? Yeah, that is how it is. Okay. Is there any change in the top management or the organizational structure after this deal happened? Any new management staff, I'm talking about the top management staff either came in or came out or somebody is about to come in, something like that in the top management? I'm talking about CEO minus one. At the management level, there haven't been any changes. At board level, we recently inducted 2 new directors, which were announced as part of last board meet. Okay. Management was as it is, as it was before this acquisition took place. Yes. Even as part of our discussions, Reliance Group was very clear that they would want the existing management itself to take over and keep running the business, which is how it has panned out. Okay. The last piece of it, bit operational. The hiring spree in the last few quarters is suddenly seriously accelerated. Of course, we all understand that at some point of time, the return will come and it is fixed in expenditure for which the operating leverage will play out at some time. Just trying to understand why that was so much of, or recruitment happened almost in a one quarter or two quarter, rather than on a staggered manner as and when business recovered and as and when the operating leverage from the existing staff are getting factored into the PNL and the balance sheet. Okay. See, let us understand. When I hire, say, 100 sales employees, they take anywhere around, say, 4-6 months to start producing some decent revenue, and they reach their particular peak productivity in, say, 12 months timeframe. Now, if I were to follow this particular approach to say that, "Okay, I will hire 500 people, I will wait for them to become optimal at the end of 9 months, 12 months," I would unnecessarily end up losing time. What we did was once we fine-tuned our strategy to say that, "Okay, we will aggressively focus on selling monthly payment plans." We saw productivity of existing team itself was ramping up. That is when we went about hiring aggressive hiring. That aggressive hiring also, in my view, already was done in a staggered manner. It was not one particular single quarter where we hired. We hired over last four quarters. That was already phased out. As an investor, so probably we should read into is that as a management, you are confident that even if the hiring spree was accelerated in the last three, four quarters, the utilization maximization will eventually happen and the idleness of the existing staff will not hurt your margin profile going ahead. Yes. Whatever is the cost structure. See, whatever people I hire, their salary costs have already hurt the P&L, so to say. Now, going forward, whenever the top line starts to show up in P&L, those margins should automatically see expansion. Internally, the way I look at it is the INR 190 crores cost structure that I have today on a quarterly basis. On P&L basis, it shows up as INR 221 crores of top line. For me, that INR 190 crores fetch me INR 245 crores of collections and INR 265 crores of realizable value. In a way, that particular margin profile is already better versus what gets reported. P&L margin is obviously with a lag. That INR 221 crores is coming from customers whom I had sold in last 3-4 quarters, my costs are already getting amortized on a monthly basis. Thank you. That's it. Thank you very much. I like the confidence of the management. Thank you. Thank you. We'll take our last two questions. We have a question from Vivekanand Subbaraman from Ambit Private Limited. Please go ahead. Hi. Just one question. Abhishek, have you spoken about this the headcount that you have deputed to some of these projects that are under development? You know, just to unpack the you know, the headcount question better. The headcount attributed to some of these projects that is not very high at this point of time, would be say, sub, 200 or so, but I'll have to check on exact numbers. Okay. Are these staff members, you know, fungible in terms of, you know, can they be reassigned to, you know, for example, JD Shopping, you guys took a call that perhaps the regulations and the extent of cash burn needed doesn't entail a very aggressive push. Are you reassigning these people to the core business itself? Is that how you are carrying it out? Yes, that is very much fungible. The straight away proof is that this particular quarter, while total headcount addition was 300 employees, my sales count addition is already 600. Some of those particular employees, we found it prudent to reshuffle and reassign to our core business. Right. Last quarter, I believe you had mentioned that, you know, you have around 600-650 people in Jd Mart. Is that the same or have you added any more people there? That stands at broadly around INR 750 or so at this point of time. All right. Thank you very much, and all the best. Thank you. Thank you. We'll take a last question from Sarang Sanil from RW Investment Advisors. Please go ahead. Good evening, sir. Congrats on good set of numbers. A couple of questions. Could you give a breakup of revenue and paid campaigns into Tier 1 and 2, 3? tier one cities contributed about 62% to revenues, and by paid campaigns, they contributed about 42%. Okay. That's broadly the top 11 cities. Is it? Yes. Top 11 cities. Okay, understood. Understood. Okay. One thing I don't understand is that, so I posed as a seller and I experienced... I tried calling JD and everything. Within... I tried with multiple cities and the minimum subscription cost for a city called Trivandrum, which could probably be a tier 2, tier 3 city, the minimum subscription fee was INR 3,000. Some place like Bangalore, the minimum subscription was INR 4,000 per month. Okay. I don't understand how annually it turns out to be INR 20,000, INR 18,000-INR 20,000 on paper, while, you know, when we analyze the monthly thing, it is around, you know, INR 48,000, INR 45,000-INR 50,000, right? Is it because a lot of people are dropping out? Couple of points there. One, the average ticket size that you see is on a blended basis for pan-India, and the tier one cities typically are about 30%-35% higher, whereas the other smaller cities are at a lower price point. Secondly, this particular pricing also tends to be customized at a category level. No, not all Customers of, across the city will face, similar pricing. Right. Once our particular feet on street comes up, they understand what are your keyword requirements, which all geographies you want to target. Basis that, they propose the relevant pricing. Understood. Could you give us an average, say, ticket price for tier one city or tier two, three city? As I said that, Let me check, I might have it handy. Tier one cities versus the average, it is about 30% higher. Right. Right. No, I mean absolute number. Absolute, I will have to check. Should be around INR 26,000-27,000 or so. Okay. That's like roughly INR 2,000 per month? Yeah, 2,200 INR per month on an average. For a tier one city, is it? Okay. Also a follow-up on the same. What% of overall paid campaigns stay for a year or more on an average? What% of, sorry? Of the overall paid campaigns. Say we have about 5.2 lakh, right? So- How many of them actually stay for a year? Historically, the churn rate that we have had, which we see as if 100 customers signed up today, how many go into year 2, exactly 1 year down the line, that is around 55% retention. Say around 40-42% do not go into year 2. Having said that, in our particular case, which we have discussed multiple times in the past as well, a particular customer wanting to pause their campaign after a period of 1 year does not mean that they have churned out for life. Advertising tends to be a slightly discretionary spend, where a person might think that, "Okay, let me pause the campaign for 3 months, see how my business is doing." 3 months later, 6 months later, they might want to come back into the paid ecosystem with higher or lower spends. The way we look at it is, I mean, overall, how many particular customers that we are signing up rather than, okay, just after one year, how many are going into year two or not. Mm-hmm. Okay. Understood. For example, during the COVID period, customers who, say, churned out that particular year or did not renew, a good chunk of them are coming back into the paid ecosystem today. Okay. Got it. Got it. Got it. Also, one more thing. From my experience, you don't give any discounts for customers paying a upfront annual fee, right? Why is this so? Say a B2B player like IndiaMART, typically gives out a discount for paying upfront. Okay. This was a intentional strategic call that we took. We did use to give some particular discounts for upfront payments. A certain, say, cash discount, which sounds logical as well. What we realized was that in those particular situations, at times there tend to be bit of miscommitments because the salesperson is wanting to get the lump sum money upfront. We said that we anyway as an organization are keen to sign up as many customers on a monthly plan basis. We actually do not want customers to pay up on a lump sum basis upfront. We want those particular customers to pay us on a monthly basis and keep paying us for a longer timeframe. That is the reason we decided that, okay, let us withdraw those particular discounts on upfront plans. Having said that, our particular branches do have a discretion to run some short-term offers that they might want to do. Okay. which is a key feature in any business. Sure. Understood. Understood. All the best. All the best. Thank you. Thank you. Thank you. I would now like to hand the conference over to Mr. Abhishek Bansal for closing comments. Over to you, sir. Thank you everyone for joining us. In case you have any further queries, please do reach out to us. We will do our best to address. That's it from our side. Thank you. Thank you. Thank you, sir. On behalf of JustDial Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines.