Just Dial Ltd
NSE:JUSTDIAL
| US |
|
Fubotv Inc
NYSE:FUBO
|
Media
|
| US |
|
Bank of America Corp
NYSE:BAC
|
Banking
|
| US |
|
Palantir Technologies Inc
NYSE:PLTR
|
Technology
|
| US |
C
|
C3.ai Inc
NYSE:AI
|
Technology
|
| US |
|
Uber Technologies Inc
NYSE:UBER
|
Road & Rail
|
| CN |
|
NIO Inc
NYSE:NIO
|
Automobiles
|
| US |
|
Fluor Corp
NYSE:FLR
|
Construction
|
| US |
|
Jacobs Engineering Group Inc
NYSE:J
|
Professional Services
|
| US |
|
TopBuild Corp
NYSE:BLD
|
Consumer products
|
| US |
|
Abbott Laboratories
NYSE:ABT
|
Health Care
|
| US |
|
Chevron Corp
NYSE:CVX
|
Energy
|
| US |
|
Occidental Petroleum Corp
NYSE:OXY
|
Energy
|
| US |
|
Matrix Service Co
NASDAQ:MTRX
|
Construction
|
| US |
|
Automatic Data Processing Inc
NASDAQ:ADP
|
Technology
|
| US |
|
Qualcomm Inc
NASDAQ:QCOM
|
Semiconductors
|
| US |
|
Ambarella Inc
NASDAQ:AMBA
|
Semiconductors
|
If you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.
Utilize notes to systematically review your investment decisions. By reflecting on past outcomes, you can discern effective strategies and identify those that underperformed. This continuous feedback loop enables you to adapt and refine your approach, optimizing for future success.
Each note serves as a learning point, offering insights into your decision-making processes. Over time, you'll accumulate a personalized database of knowledge, enhancing your ability to make informed decisions quickly and effectively.
With a comprehensive record of your investment history at your fingertips, you can compare current opportunities against past experiences. This not only bolsters your confidence but also ensures that each decision is grounded in a well-documented rationale.
Do you really want to delete this note?
This action cannot be undone.
| 52 Week Range |
710.8
1 354.75
|
| Price Target |
|
We'll email you a reminder when the closing price reaches INR.
Choose the stock you wish to monitor with a price alert.
|
|
Fubotv Inc
NYSE:FUBO
|
US |
|
|
Bank of America Corp
NYSE:BAC
|
US |
|
|
Palantir Technologies Inc
NYSE:PLTR
|
US |
|
C
|
C3.ai Inc
NYSE:AI
|
US |
|
|
Uber Technologies Inc
NYSE:UBER
|
US |
|
|
NIO Inc
NYSE:NIO
|
CN |
|
|
Fluor Corp
NYSE:FLR
|
US |
|
|
Jacobs Engineering Group Inc
NYSE:J
|
US |
|
|
TopBuild Corp
NYSE:BLD
|
US |
|
|
Abbott Laboratories
NYSE:ABT
|
US |
|
|
Chevron Corp
NYSE:CVX
|
US |
|
|
Occidental Petroleum Corp
NYSE:OXY
|
US |
|
|
Matrix Service Co
NASDAQ:MTRX
|
US |
|
|
Automatic Data Processing Inc
NASDAQ:ADP
|
US |
|
|
Qualcomm Inc
NASDAQ:QCOM
|
US |
|
|
Ambarella Inc
NASDAQ:AMBA
|
US |
This alert will be permanently deleted.
Just Dial Ltd
You don't have any saved screeners yet
Good evening, everyone. This is Shaleen Kumar from UBS Securities. Welcome all to Just Dial Third Quarter Results Earnings Call. From the management, we have Mr. VSS Mani, Promoter MD and CEO of the organization; and we have Mr. Abhishek Bansal, CFO of Just Dial. So I now hand over the call to Abhishek for his opening remarks and post that we can open the floor for Q&A. Abhishek, over to you.
Thanks, Shaleen. Hi, everyone. Welcome to Just Dial's earnings call for third quarter fiscal '22. Our operating revenue for the quarter stood at INR 158.9 crores, declining 6.3% on a year-on-year basis and was up 1.9% quarter-on-quarter. Adjusted EBITDA, excluding ESOP expenses, stood at INR 10 crores, a margin of 6.3%. Other income, which was partly affected due to increase in bond yields during the quarter, stood at INR 28.6 crores. Overall, net profit after taxes stood at INR 19.5 crores for the quarter. In a nutshell, current quarterly numbers obviously reflect the impact our business has witnessed over the past few quarters on account of COVID impacting SMEs. B2C service-oriented categories contribute almost 2/3 of our revenue, and SMEs in these categories have been the most affected during these COVID times. However, while macro environment and pandemic situation will keep evolving, we have taken certain measures recently, which are yielding good results in recent months and likely, our monetization shall be back on track in coming quarters. Firstly, on monetization. We have implemented firm pricing and withdrawn almost all discounts that we had been offering during various phases of the pandemic. Along with former pricing, we have started focusing aggressively on monthly payment plans, which helps us sign higher number of customers and also gets us a better monthly ticket size. During November and December months, we signed almost 65% of our customers in those months on monthly plan basis, and this was just about 8% in preceding quarter. As a result of this strategy, it has helped us improve sign-ups, which is also partly visible in uptick in paid campaigns, which grew sequentially by about 6,600 campaigns to 437,000 paid campaigns at the end of the quarter, and it will likely aid our future revenue growth as well. Due to change in mix of upfront versus some monthly plans, near-term collections do get affected since lesser customers are paying us full money upfront. However, over the tenure of the contract, which is typically a year, we expect to gain from future collections that will come via monthly installments. On operating expenses, employee expenses are about 16% Y-o-Y and about 9% sequential increase. We added almost 1,250 employees during the quarter, majorly in sales. While employee costs have upfront impacted P&L, revenue generation from newly added sales force should aid future margins. We have also been hiring talent across our product technology, content and marketing teams. Advertising spend stood at about INR 3.5 crores for the quarter. Overall, cash and investments stood at INR 3,769 crores as on quarter end. Coming to other operational highlights. Traffic stood at 142.7 million unique users for the quarter. 84% of the traffic now comes from mobile platforms. Database strength has now grown to about 31.4 million listings. Overall, going forward, the focus is to get our core business back on a healthy growth trajectory as soon as possible and early signs of the same already seem to be visible. Plus, we are working to roll out new initiatives, which are currently under various stages of content building, product development, user experience optimization. So with this brief update, we shall now open the floor for questions for further detailed discussion. Thank you.
Thanks, Abhishek. Ishi, can you please open the floor for Q&A.
[Operator Instructions] Over to you, Mr. Abhishek.
So Abhishek, till the time we get a question from the participants, possible to provide some more -- some updates on different platforms as well. Maybe you can start with our B2B platform. Any update over there?
So Shaleen, at this point of time, we are sort of looking at our business in 2 parts. The first, obviously, the core business, which, as I mentioned, got affected due to -- primarily due to first and second wave of COVID. So there, the focus is to get that particular piece back on a healthy growth path as soon as possible. On newer initiatives, ultimately, the way we look at it is that more and more consumers are going online wanting to do things online, be it in terms of booking any appointments, doing any transactions. On the other hand, as far as SMEs or businesses are concerned, they also want to be present online to get discovered, to get new users. So our newer initiatives, be it via JD Mart, Jd Xperts and other platforms that we are working on. The idea is to mainly add a transaction layer to all those categories where we have, in any case, been dominating via search and discovery. So Jd Xperts, for example, we have -- we are currently testing with one category pest control services. Some of these particular -- more services will go live in this particular quarter. Jd Xperts will have a dedicated app as well, which should get rolled out some time this particular quarter.The idea of this particular beta phase launch is to optimize user experience and then scale up as and when user experience is optimal. Similarly, on JD Mart, at this point of time, we have almost 1.2 million catalogs specific to B2B businesses. Overall, there are about 8-odd million businesses on JD Mart for search. And out of the 1.2 million catalogs that we have, about 0.5 million are quite rich catalogs. So there is work happening on content, et cetera, on JD Mart. And apart from that, there are certain other initiatives, as I mentioned, ideas to be able to add a transaction layer to services as well as other categories on the platform.
Sure, sure.
[Operator Instructions] Shaleen, we don't see any raised hand out as of now. Thank you.
Sure. So I think I'll use the opportunity then. Abhishek, so obviously, the big question in everyone's mind, like when we talk about is like historically, Reliance is promoter over here. And historically, we haven't seen a lot coming out post acquisition, what has happened in the past? So I just want to pick your mind here, like how the management or new management is aligned and what kind of discussions are happening in terms of the business plan going forward strategy because there's a lot of cash also sitting on the books, right? So how you intend to utilize it? So any color you can give on both in terms of your alignment with the strategy, how actively they are involved with you guys and maybe future use of cash, et cetera, which you will be using.
Okay. So firstly, Shaleen, on the management, this is no new management at this point of time. It's the same strong management experience team that is running the show. Definitely, RRVL's presence on the Board is there and we actively engage with RRVL and RRVL's leadership team for our particular future business plans. So at this point of time, while we did this particular strategic transaction, both parties realize that there is a great asset in terms of 30 million, 31 million listings, active vendor relationships, and there is a lot that can be done in terms of enabling SMEs going forward. So as I mentioned, at this point of time, as far as usage of cash is concerned, cash will definitely -- cash is already getting deployed in a manner to -- in terms of hiring talent to build our particular product to augment our particular initiatives in terms of addition to sales force, et cetera. As and when our particular existing and new businesses would require marketing spend, advertising support, there will be aggressive spends on those as well.
Okay. I think we have some questions from the participants. Ishi, can you moderate?
Sure. Hi Sai, you're the first participant. Kindly unmute yourself and ask your question.
My question is, with the Reliance coming in the Board, okay, what kind of changes -- it's similar lines to the previous question. What kind of changes happened? And second thing, there is a lot of rumors playing around in market that JD is planning to launch the e-commerce platform. Is there anything which you are thinking on those lines? So what kind of future growth prospects which we can, as investors, look at it?
Okay. See, first of all, with the Reliance coming on Board in terms of changes, definitely. They have -- they are now present on our Board. There are active strategic discussions that happen between both sides. Operationally, also, our teams are actively engaging with them to see what all synergies can be utilized at both ends. One key benefit even more compared to synergies is the learnings that you can draw from strategic partners such as Reliance. For example, they have strong expertise and even manpower intensive, say, businesses. So while we are looking to aggressively increase our manpower to aid our core business, so some of those learnings can be deployed as well. So I think over coming months and quarters, we will be able to leverage on these particular synergies, learnings and that should be visible in our performance as well. To your second question regarding any foray into e-commerce bid. So as I mentioned in my opening remarks, it is very clear that the way things are evolving, both users as well as SMEs do want to do things more and more online. Keeping that in mind, we have initiated the projects such as Jd Xperts, JD Mart on the B2B side. So as and when some of these initiatives start taking more color, we would be in a better shape to share. And in any case, most of these particular platforms are user facing platforms. So whenever they are getting launched, you will obviously be the first ones to be able to witness those.
[ Ankur ], you are next. Kindly go ahead and ask your question, please.
So my question is -- so I don't know whether Abhishek or Mani, whoever answers. There are 2 questions. One, so as an individual investor, I mean, closely watching Just Dial and been participating into all the investor meetings for 4 quarters now. So I started last December and here again, we are the next December. And JD Mart seemed to be the biggest initiative, a game changing one. And I know that the app has been launched. It was launched, there was a lot of advertisement done during the IPL first phase, and then it has continued. And what I see in your investor deck and in your commentary is 1 or 2 bullet points of how many listings you've had. But as an investor, who's playing long and really want to understand what's going on there's nothing much shared. So it would be great if you can elaborate where we are on JD Mart. Maybe it's quite a while before JD starts competing with, let's say, India Mart. But still, I'm sure all the investors and especially me would like to know a lot, lot more about what JD Mart is doing right now and its capabilities. Number two, it was a little worrying to hear that on the search side of it, we had to move to a monthly subscription model. So is it really a sign of changing times that search is a business, the advertisement bit of, as a business is becoming tougher with the Googles of the world and a lot of things coming on the Internet. And it's almost a survival mode. Is that something as an investor, I would like to understand why I should not be concerned about. So these are the 2 questions.
Okay. So Ankur, on the first question on JD Mart, See, one thing we have to remember is JD Mart primarily catered towards, say, B2B categories. In B2B categories, we used to monetize about 20%, 22% of our revenue, which even today is around 22%, 23%. So as a SME, SME does not really bother about whether they are getting inquiries, traffic, visibility on JD or JD Mart. Ultimately, it is about JD's platform, be it visibility on JD or JD Mart. Now over the last 3, 4 quarters, what has also happened is that like first quarter of this particular fiscal year, we were very severely impacted by a second wave of COVID. Now that particular impact was not just restricted to this 22%, 23% of the business. So we have to ensure that the rest of the 77% of the business also stays on its particular growth path. Those are some of the reasons that this particular JD Mart related active update, so to say, you might find it to be missing. On your second question, why have we shifted on a monthly plan basis, First of all, during our IPO days, when we were growing top line at about 25% to 30% each year. At that point of time, we were about 45% of our customers used to pay us on a monthly basis. And a couple of years were as high as north of 50%, 55% as well. So it's not that at this point of time because customers are not willing to pay upfront, that is why we are shifting to a monthly plan basis, the way ecosystem is evolving. In most cases, people are actually wanting to pay in small tickets. They might be okay subscribing, taking subscription on a monthly basis. That is why we said that, okay, if we can remove any sort of friction from our sales process, that will help. So there might be a customer who might be thinking twice that, okay, whether I should spend INR 20,000, INR 22,000 in one shot, whereas they might start with INR 2,000 a month subscription. Later, they might even be willing to go for our annual plan thinking that they will get some 10%, 12% upfront cash discount, et cetera. So the shift to a monthly plan is mainly to say that, okay, we are okay not locking in customers for a longer tenure. We want customers to sort of come in at their particular will. So that is the only thought process. and which is what we are seeing that we are able to sign up more customers and the estimated revenue from these particular sign-ups is also seeing a growth path. So ultimately, we have to see that total revenue sort of should get maximized. All your digital products, for example, whether you do advertising on a Google, Facebook or any other such global platform. you can sort of recharge your wallet for x rupees. You can run campaigns for 5 days, pause it for 2 days, and that is how the ecosystem is.
How does that payment happen in the platform? Because, for example, these RBI impending guidelines about creating issues at auto renewal makes it tougher for subscription services like yours? And if I may compare with Netflixes of the world, difficult to -- so renewal process becomes even more challenging...
No. So on that front, we haven't faced much of a challenge. These particular -- first of all, these monthly subscriptions, the new RBI guidelines primarily affect whatever subscriptions are set on your credit card or a debit card. In our case, majority of these particular monthly payments are set directly on the bank account. And even in cases where they are set on a credit card or a debit card, those stricter rules apply for transactions over INR 5,000 a month, whereas our ticket size at this point of time is much lower. So we are not really worried on that front. In fact, these days, it is much easier to set up a ECS or a monthly standing instruction on your bank account. Most of the banks they provide that particular e-NACH facility, which allows monthly payments to be directly deducted from your bank account.
And do we, as investors expect that you will maybe next quarter start sharing the mix of the subscriptions that you have? Because I still see a decent number of deferred revenue sitting in the balance sheet. So now maybe you started this plan recently with maybe from next quarter onwards, it will be -- will you be willing to share the mix so that we get much bit at priority?
Maybe we can look at sharing realizable value as a trend, which is indicative basis past track record. That may give -- because when there's not much of deferred revenue rather than deferred revenue reducing that could be panning among investors. So if we share the realizable value part, I don't know, Abhishek, you have to think it on.
Sure. We can take a look at that. As I mentioned during my opening remarks, in last quarter, our monthly payment plans were at about on an average 55%; with November, December at about 65%; and the previous quarter was at about 8%. In fact, in deferred revenue, the one reason why that has sequentially declined is because of disadoption of our monthly plan strategy. So in monthly plans, as I mentioned, that's while upfront collections will be lower, but over the period of next, say, 12 months, those particular collections should more than offset the upfront impact.
The monthly plan should be read more like how there's the EMI plans to buy goods and services. So basically, if you have equated monthly installment then there are more number of people being able to afford it. Some, in our case, it's like earn and pay because you're paying on a monthly basis. And they're able to spend and commit more larger sums of money since it is an equated monthly installment.
So specifically enough, it's a trade-off. The renewal process is a challenge.
It's auto renewal. All these are literally perpetual contracts till the customer stops his payment. It's auto debited to his account.
Yes. So I think that's a good sign for the business.
Yes, yes.
Much could be maintain and that -- those will be very important to track as well.
Right. So just to give some flavor on that. Pre-pandemic, we used to get about INR 23 crores, INR 24 crores a month of collections from these particular monthly deductions directly from bank account. That INR 23 crores, INR 24 crores went down to about INR 13 crores in September month. And that INR 13 crores has already bounced back to about INR 18 crores in December. The current month run rate is already about INR 20 crores, INR 21 crores. So this particular monthly plan strategy while we have adopted it just for last 2 months, it is actually giving us this particular growth. And overall, if you are able to maintain this particular momentum, we should be definitely back on track in terms of overall collections and overall revenue, P&L revenue as well.
I think that's very encouraging, Abhishek and Mani. So thanks so much for that update, and I shall really look forward to more traction on JD Mart and more updates as well and will be more segment, especially. So look forward to that and all the best to yourself and myself as well as an investor.
We have a question from Mr. Vivekanand. Please unmute yourself and introduce yourself to ask your question. Please go ahead.
I'm Vivekanand Subbaraman from AMBIT Capital. My 2 questions. The first one is on the KPIs by the geographics list. So what would be the split of our campaigns in the top 11 markets and revenues from the top 11 markets?
So outside top 11 contributes about 57% to campaigns and about 35% to revenue. So top 11, say, 43% to campaigns and about 65% to revenue contribution.
Okay. And which of the -- I mean, the recovery appears to be better in the markets outside top 11, right? Is that correct? Is that assessment correct?
That is partly correct. See, that is also because that whenever these COVID waves have impacted, the top metros are the ones that see the first set of restrictions. For example, in this particular current wave of COVID as well, a geography such as Delhi went into night curfews, weekend lockdowns, et cetera. So that is why those particular geographies tend to get affected a bit more and recovery in Tier 2, Tier 3 cities is faster versus Tier 1.
Okay. Got it. And my second question is on the manpower intensity point you made. So we are ramping up headcount again in anticipation of growth. Should we look at the gross margins of the business differently now versus earlier because now you are focused on getting closer to the transaction and also the intensity -- sales intensity might be higher for monthly renewals versus, say, correct ones and bill over 2 years or 1 year, right? So how should we think about the gross margins in this scenario?
See, once we get into transactions, those will have to be evaluated separately in my view. In fact, in case of transactions, most likely, we would be charging, say, a certain percentage on the value of the transaction. And once a particular vendor is onboarded, there is not really much of an effort in terms of renewal, et cetera. So that set of business will have -- it will have its own margin profile. It might have lesser sort of gross margin, but volumes would more than take care of it. And as far as the core business is concerned, their gross margin, I mean, historically, we have been a sort of 60% gross margin business. And hopefully, we would be able to sort of even improve on that in coming quarters. For example, last year, while our top line was affected about 28%, still we were able to pull levers to deliver 25% plus EBITDA margin. So to that extent, I think gross margin is quite healthy. And that is -- that should be sort of maintained or be even improved going forward.
Okay. Just pressing on the manpower intensity point. We are ramping up headcount of the feet on street as well as telecallers. So is it largely to do with the legacy business? Or is it hiring related to JD Mart? Or is it hiring for the smaller towns where your position seems to be getting stronger. Where is the hiring happening? And where do you think the future hiring will be directed?
So 2 years back, say, around 8 quarters back at our peak, when we had about 12,500, 13,000 overall employees, we had about 10,000 employees in sales. In September quarter, that number dropped to about 6,800 employees. So about, whatever, 30%, 32% drop primarily because we were seeing that on the ground, COVID had impacted SME so much. For us, the focus was primarily on consolidating our sales force, getting better productivity from existing resources. But now that we realized that we would be in a position to sort of grow back our particular core revenues. We have got the 6,800 back to about 8,100. So this particular hiring is happening across geographies, across feet on street, telemarketing, et cetera. So the idea is that in a couple of quarters, we would want to go back to that particular 10,000 mark as well. At the same time, not compromise on productivity as well as our gross margins.
Right. And Abhishek, in your comments, you also mentioned that you are learning a lot from Reliance in running a manpower intensive business. Could you elaborate that? And explain to us how that is benefiting Just Dial?
Exchange of ideas, that's all. I mean, they have a large retail and even in Jio, they have more like an interesting reseller model, which is freelancers who are working for them, and we're learning a bit about that because that will help us because that will not have any costs until you get the revenues. So we're working on some of those ideas. It's just that we are just telling you that for all kind of exchange of ideas and synergies that we are working on between the 2 companies.
Ashish, we are unable to hear you. Yes, Ashish, please go ahead.
Very good evening to all. See, I have very -- 2 questions I have for you. The first thing is, as a small investor, we need to know when do you plan to put the INR 3,700 crores or that you will have cash in your books? And the second thing is that why this -- in this quarter, the treasury income from other sources was very little as compared to last quarter when you had INR 3,700 crores in your books?
Okay. Ashish, to your first question regarding deployment of INR 3,700 crores. See, the thought process is that, yes, we are very well capitalized, and this particular money would be put to good use as and when required. Fortunately, our core business also generates very healthy free cash flows. So this particular INR 3,700 crores, we'll see at what stage and which products require this particular financial support. Coming to your second question, yes, you are right that sequentially, treasury has grown from INR 1,500 crores to INR 3,700 crores. However, in last quarter, on a sequential basis, there was about a 30 basis point increase in bond yields on a say, India 10-Year Bond Yields. In fact, for 3-year paper, which is what forms bulk of our portfolio, the increase was as high as about 45, 50 basis points. Since we deploy in debt mutual funds, which get mark-to-market every quarter, that is why this particular quarter saw about INR 28 crores, INR 29 crores of other income. Overall, the way to look at it would be that the embedded yield to maturity of the entire treasury would be about 5%, 5.25% or so. So on INR 3,700 crore treasury about whatever, 5%, 5.25% is what we should be earning at current interest rates over the long term. Say over 4 to 6 quarters, that is how it should be, though there could be quarterly fluctuations.
Okay. We have next question from Mr. [ Naman ]. Please unmute and introduce yourself to ask your question. Please go ahead, Mr. [ Naman ].
Yes. Good evening, everyone. Mr. Mani, I have a question for you. This is maybe a repetition of the past few questions, but it is intriguing to know that we have such a large cash sitting on balance sheet. In the last quarter, we also mentioned that we will not be really interested in distributing the cash back to the shareholders in terms of buybacks or dividends or whatever like we used to do in the past. Instead, we want to use the cash for the business. While I understand that the manpower increase and some products may demand cash. But still, INR 3,700 crores is a huge chunk of cash, especially when you have existing business generating free cash flows as well. So what also amazes me is that we spoke about e-commerce portals like Amazon, Flipkart. It's such a big opportunity in India that our portal is designed to list SME businesses, but can't it be scaled up to counter these kind of businesses because you already have a basic portal in place, you have cash on books. So why can't we look at investing in those lines? Your views on that, sir?
Absolutely. So our main focus area is going to be what we call as 3P marketplace, which is third-party marketplace, purely allowing all kinds of businesses to sell their products through our platform. And the focus is from a customer experience point of view, the differentiator will be like instant delivery. There will be obviously competitive pricing and an after sales service available also on dialing the number at 10x8 just in case. So we have a product that's getting launched, which is at a very large scale when it comes to any kind of product, whether it's B2B or B2C, can be sold online through our platform. The pilot run for the consumer B2C version will be somewhere in February, which is when we start signing up businesses, which is all the neighborhood stores, all kinds of businesses that you see in any city, which are brick-and-mortar presence. So we'll be their online platform, which will fetch them business, which they can execute instantly. On the services front, as Abhishek said, we're launching something called Jd Xperts, which is something like equivalent to urban company or any of those where you can actually book it online with Just Dial without bothering about who the vendor is. And you will -- you can expect high standard of user experience in terms of the services as well as to the tariff and other things. All these things take a time. See, unfortunately, we have been affected by COVID waves. If you see the first, it was quite jinx experience for us. We spent a huge amount of money in IPO to launch JD Mart. The entire 45 days was a washout because of second COVID wave. So we have been a bit unlucky, too, in that sense in the past. Now that we have a huge solid partner. It's like kind of a very -- feeling that it's very invincible as such with this kind of a partner. If we focus on execution and keep our heads on our shoulder and look at day-to-day, week-to-week, month-to-month and quarter-to-quarter. I think this company will be worth a lot, lot more than what it is today. We don't want to do -- give promises right now because in the past, we have spoken very bullish about products and somewhere we have lacked an execution or we didn't have the courage to go and spend a lot of money to make it happen. So as an example, was Omni. So now that we have a great partner and there is a bit of derisking, Yours Truly has also done, so there is no reason that we should apply any break. We should just go all out, aggressively pursue things. How quickly we can do that, all the timing issues, we cannot comment. But all I can say is, the steps that we have taken in the last couple of months have been fantastic and they've been yielding great results, and we continue to do take similar steps and keep looking for a better future.
We have next question coming from Mr. Pranav Kshatriya.
Yes. I'm Pranav Kshatriya from Edelweiss. My first question is, this quarter, there was quarter-on-quarter revenue dip, although last quarter, we had a fairly decent jump in the unearned revenue. And considering this tends to be a festive quarter, I was expecting a bit of a bump up in the revenue, but it did not pan out. Can you highlight any of the reasons for not only the deceleration in the revenue, but also deceleration in the traffic on a quarter-on-quarter basis? That's my first question. And secondly, can you point out what exactly is the advertisement spend in this quarter? And what percentage of traffic is paid traffic for the quarter?
So Pranav, on a sequential basis, traffic had a slight impact, which typically happens during festive months. So that particular week, 10 days closer to the Diwali, Dussehra, those are the days when traffic tends to sort of get affected. On a sequential basis, revenue has marginally grown. There has not been a degrowth. But obviously, it has not grown to the extent that we would have ideally wanted it to be. As far as ad spends are concerned, they were about INR 3.5 crores for the quarter. And out of the total traffic of about 143 million quarterly users, about 6% to 7% came from paid initiatives, the rest all was organic.
We have next question coming from audio dial-in. Please unmute and introduce yourself to ask question.
[indiscernible] from Kotak Investment Advisors Advisers. And this question is exactly directed to Mr. Mani. Historically, you have always focused on profitable growth, free cash flow, et cetera. But the cash what's your -- especially what we have now? Will that strategy really change, where you'll be more aggressive like you said and you'll focus more on growth or will it be used in the short term, compensating on your free cash flow sort of strategy that we had in the past, number one. And number two, if you look at the INR 3,700 crores of cash that you have, if you can just give us the top 3 areas of spend and over what timeframe would you intend to spend in this area?
So to answer your first question, this whole transaction with Reliance Retail was done only to keep that in mind that we want to grow aggressively and not look at being a nice cute profitable company. So this will -- this partnership will help us actually ramp up on our growth, and we have identified the right kind of verticals, which one is going to be JD Mart, other is JD Shopping, Jd Xperts, and there is an initiative on real estate. Our hands are full with lots of things in hand. It's basically one go-to place where you can get many things done. There will be cross-promotion, cross incentivizing users. There will be a lot of interesting things happening. So as the quarters, next few quarters, you will learn a lot more. You will see us aggressively pursuing growth for sure. And at the same time, if there's no harm in having decent cash flow, why not?
We have next question from Mr. Vijit Jain.
This is Vijit Jain from Citi. Just a few questions. First off, last quarter, I think you had mentioned that the JD Mart team was about 150-odd people dedicated to JD Mart. Can you give a comparable number to that figure for as of date? That's the first question. And the second question is related to your partnership with Jio now, obviously, Jio and Reliance put together have a what you could call probably a conciliation of services in various categories of e-commerce. So is there any conversation around reference from your website, given that you do have a decent level of profit to their properties? Any discussions around those lines with Jio is, I guess, my second question.
So Vijit, on the first question, the B2B team strength, which basically focuses on primarily B2B categories, is about 180 to 200 employees, which includes a combination of both the telecallers as well as feet on street team. On your second question regarding referrals from our platform, et cetera. So as I mentioned, both set of teams actively engaged to see what best can be done in terms of either referral from our platforms to theirs or leveraging their platforms. For example, Jio business users are a huge consumer base. At the same time, JD's 30 million businesses can be tapped into for some of their particular products and services as well. So those are some of the, I think, ongoing initiatives, which -- or ongoing synergies, which will get explored over the next few months and quarters.
Got it. And one final question from my side, if I can. So when you mentioned -- when, Mani, I think mentioned that Jd Xperts will start off with pest control and then add more categories. I'm just curious as to the thought process here. Is it that pest control is what you see as an established use case category in India because of maybe some competitors doing it and you think it's an attractive play to get into? Or do you see a fair bit of pest control queries coming into your website still in major cities, let's say like Bombay and Delhi, for example, and that's why you think that there's significant opportunity that still remains to be tapped. I'm just trying to understand what your category selection process is like.
You may see all categories launched very soon. It's just that a pilot is being practiced, pest control, you need not have shared this information also. It's just that it will be no different from any other such platform. Because across the board, we have vendors who cater to all kinds of services, and we have to cherry-pick these vendors who are the top rated ones to give that wow experience in Jd Xperts that we are talking about. So this pilot is being done just to see that it's all well oil, if it's smooth and then you can just expand it to multiple geographies and multiple categories.
Got it. And Mani, then initiative on real estate that you spoke about a little bit. Can you elaborate on that a little bit more?
So we have taken a pie from our revenue. We have taken this -- looked at the pie and look at what are the contributions from each vertical segment. And we realized that merely giving information about a builder or information about a state agency is not sufficient enough, although those categories contribute a significant amount of revenue for us if we really want to grow the revenue 10 to 15x, 20x, then we have to go all out like any other international real estate site, which is like finding apartments, pillars, farm lands, factories able to see them, view photographs, view videos and allowing agents to post their listings, allowing builders to sell their properties through our portal post their listings and all that. So you will see a complete robust real estate experience within Just Dial as well as a dedicated site, which would be for Just Dial, the JV part of it, yes.
Sir, I have a few more questions, but I'll guess I'll just jump back into the queue.
You can carry on. Just carry on since you're online.
Sure, sure. Okay, sure. Great. So my last question actually really is, is that can you give me a sense of what your gross campaign addition was in this quarter? So the net was obviously 6,600, what the gross figure was?
So Vijit, we do not specifically track gross versus net. So the way this particular number is evaluated is that as on quarter end, how many customers were active on the platform. Because as I said, there might be a customer after 1 year, they might be up for renewal. They did not renew for a month, but they renewed 1 month later. So there is no way to be able to exactly say that it is a fresh customer, renewal customer, et cetera. So we track active campaigns.
Okay. Got it. Yes, sure. And finally, on -- are you seeing any kind of impact since the onset of Omicron this quarter?
So on third wave, there has been minor impact. Fortunately, overall, at this point of time, impact seems muted and impact seems restricted primarily to tier 1 cities considering cases have started going down in metros. I think next week, 10 days would be critical. But compared to the impact that we had during the second wave, et cetera, third wave impact seems to be much muted.
Great. And when you say that the plan now to use a partnership with Jio, sort of Reliance and with the cash level position you have and with the free cash flow limiting business you have, the plan is to grow more aggressively. And I think you mentioned earlier your intention to go back to 10,000 salespeople. So I guess, looking at the core business specifically, do you think going forward, the focus will be to more aggressively push for new campaigns in Tier 1 cities and get some of them back and that's how you will grow the core business? Or when you look at growth aggressively, you're looking at the entirety of all the things you're doing and especially focusing on the newer focus areas like Jd Xperts, B2B and the real estate venture and those kinds of things. So I'm just trying to understand where the growth -- where the aggression is going to be more focused on the newer areas or the core areas?
See, both things at this point of time are being pursued simultaneously. In the core business, which is a well-oiled machinery, we realize that we need to ensure that our pricing is optimal. We need to ensure that we are hired and scale up at the right time. And there, as I mentioned in the past, we are not obsessed with growth coming from campaign additions or it is coming from ticket size. Overall, revenue, revenue per sales employee, that is what should be optimized, which is what will ensure that my top line grows at reasonably healthy margins. And as far as new initiatives are concerned, they are from the perspective that, okay, what will be Just Dial's growth drivers, 5 years, 10 years down the line. So some of those particular products are in pipeline. And as and when they start showing traction, firstly, in terms of users, followed by in terms of for revenue, profitability, et cetera. we will sort of evaluate them at that point of time.
We have next question coming from Mr. [indiscernible]. Please unmute introduce yourself to ask question, Mr. [indiscernible].
Abhishek, this is Amar here, this side. So I have a question on B2B business. If you can give us some understanding like B2B business, which was around INR 200 crore business, I think, in FY '22. What would be the B2B size in 2022? And basically, now is that B2B whole business is consolidated into JD Mart? Or we are still doing the B2B business separately and JD Mart is launched separately. How it is?
So B2B currently is about 22%, 23% of our revenues. So whatever vendors that get signed up on Just Dial, vendors are visible and their products and digital catalogs are visible on JD as well as JD Mart. So JD, since it is a well-established search engine, we already draw a lot of traffic for B2B-related categories. So our customer doesn't have to take 2 separate sort of subscriptions. Whenever they do take a subscription, that is for all Just Dial platforms put together. So in this case, visibility on Just Dial as well as JD Mart.
Okay. And now currently, how many subscribers, let's say, in the B2B business?
So B2B business, I think there should be around 80,000-odd subscribers, about 20% of 437,000, that is broadly, I think, should be the B2B campaign base.
And average realization would be around 20,000?
Yes, 20,000 annually.
Yes. And in this, like -- so what would be the fixed cost in this?
So in our case, fixed cost -- I mean, one you, in terms of you have the sales cost that is there, you have the sales team and then you have the corporate overheads in terms of whatever support functions, et cetera, that we have, so -- I mean, fixed cost is primarily the salaries that we have to pay for either the sales team or other technology content and support teams.
So basically, in percentage term, let's say, 30%, 33% would be your fixed cost?
So we look at it more as a gross margin basis. So for example, on overall Just Dial, we used to have about 60% gross margin, and against that business used to make overall about 25% to 30% EBITDA margin, which essentially means that another about 30%, 35% used to go in other support functions related to product, content, technology, advertising, et cetera. So we do not directly look at that, okay, this much percentage is fixed cost versus nonfixed. For example, while we were a 25%, 28% margin business in FY '20. In FY '21, our top line dropped by about 28% due to COVID impact. But still, we were able to optimize our cost structure such that business still delivered about 28% EBITDA margin. So that is how it is.
Okay. Okay. And let's say, in this 9...
Can I request you to please join the queue? Because we have a long queue of participants on our system.
So requesting you all to please restrict yourself to only 2 questions. And we have next question coming from an audio dial-in.
Hello. Good evening. This is [indiscernible]. I have 2 questions. So firstly, when you say you have withdrawn like all the discounts and [indiscernible] from pricing. So is this something which also can impact your paid campaign? Secondly, how do you see business and/or any market share changes in B2C category from new and old competition in general?
So, [ Pratik ]. On the first question, when we say withdrawn discounts. So when this particular COVID first wave hit us at that point of time in order to assist SMEs, we rolled out certain discounted plans. We rolled out certain schemes such as late activation, you pay today, but your campaign can be activated about, say, a month later or 2 months later whenever you want. So all those flexibilities, et cetera, we have sort of withdrawn. So the idea is to say that, okay, there are same pricing, which will be sort of be implemented, and that sense, it coincides with the withdrawal of sort of COVID second wave. So -- and as I mentioned that third wave impact seems muted at this point of time. So this is sort of working out well for us at this point of time. On your question around market share, so there aren't any formal sort of stats around market share. In fact, in local search where we operate, there aren't any sort of direct competitors, so to say, though there are obviously a lot of indirect competitors. And going forward, as we mentioned that the way things are evolving that people want to do more and more stuff online, we would be wanting to evolve into that particular transaction cum search engine.
Can I ask one more question or I shall get back to the queue? Sure. On the last call...
Yes, I think our caller got dropped. So we have next question coming from Mr. [ Anush Segal ]. Please unmute and introduce yourself to ask your question. Please go ahead.
Hello, can you hear me?
Yes, Anush, we are able to hear you.
Yes. No, I just wanted to understand. So you talked about transaction model, which will obviously have revenue as a percentage of value of transactions and will have a different margin profile from the core business. So what I want to understand is what are the categories that you think will be suitable for this transaction-driven model? And what kind of a business or how will your overall revenue change, let's say, over the next 3 to 5 years with this whole transaction model shift that you are anticipating?
So Anush, on this, I think it will be too early for us to be honestly able to comment that how will revenue profile, et cetera, change. As we mentioned that the idea is to add a transaction layer in both service and product-related categories. We would want to pick, say, low-hanging categories first. optimize them for user experience and then gradually scale up to other categories. So at this point of time, platform is getting built, there will be pilots that will be done. We will work towards growing the user base at the same time, work on monetization, et cetera. So I think it will be some time before we can be in a good position to be able to comment on this.
Maybe if I ask in a different way. Can you give us a sense of how you are thinking about this? Like maybe give some examples of what kind of categories would you be if not targeting, but what are the kind of categories that are suitable for such a business model? And how should we think about that? I mean, I know it's early days, but at least I just want to understand your thought process of how we are going about building this business.
So for example, on the services side, as part of Jd Xperts, it would be, say, home service related categories. For example, your pest control services, your categories such as any kind of appliances, repairs, then it could be extended to, say, carpenter, plumber, electricians, even could be extended to yoga trainer, fitness trainer, et cetera. So these would typically be on-demand home services. On the product side, it could be any sort of consumer durables, such as, say, mobile phones, your...
So can I add to this? So let's take shopping. Shopping will be no different from what you see in Amazon, Flipkart. The difference is the partners are located -- it's a hyper local sourcing mechanism. So ensuring that the person matching the consumer buyer to the seller to the nearest pin code and ensure faster delivery. And we have a larger inventory base in terms of, say, 1 million businesses being able -- being our partners. We're able to cater to products on demand at any time because of such a large inventory base. So when you extend this to any other product, which is, let's say, B2B in nature, bulk in nature, wholesale in nature, there, too, again, the similar strategy. Basically, all those listings on Just Dial are doing nothing, but they're buying a part in the economy. They're all playing their role as retailers, wholesalers, distributors or whatever. We're bringing them to our platform and allowing them to sell exactly the way they sell it. That includes shopping and JD Mart. This will be what we will be doing. This is a platform, which will facilitate for that. On the Xperts side, our idea is that now consumers are more into kind of uberized type of experience where they would probably want to book with one, a brand like Just Dial or a platform like Just Dial and would want that execution of that work. It could be any kind of repairs and services at home. It can be any type of services, which are rendered at home, like cleaning services or view the salon services and things like that. What do we do here? Do we employ any of these people? No way. We go to our partners, and we locally source them according to the same pin code, geo code strategy and try to cater to it on time, ensure that it's a high standard of service experience, and there are certain formats, methods that they have to follow all the service providers. Similarly, you can go dissect health care, doctors, what could happen in doctors. Doctors could be online consulting, doctors can be fixing an appointment, finding the type of specialist, specialty hospitals, various things. So can you go deep dive into it? Of course, we can. So that's where the investment is getting in. Real estate, I already explained that if we get into real estate, it's going to be much deeper content, allowing every agent and builder to publish their content for free and sell their inventories. And obviously, there will be a preference to the sponsored listing, whose products and whose postings will be showcased right on top. Like accordingly, like we would have something to do with groceries, insurance loans. So what we did was we looked at the JD revenue pie and where is our revenue coming from. Our revenues were coming from, let's say, insurance agents, people who are facilitating for loans, people who are retailers, then we looked at how is it happening this -- in modern day, modern day it's happening differently. So can we play an important role? Can we provide a platform for that? And this is what we're going to work on. So you will see we'll roll out one by one each of this. As you go to the same Just Dial also, you will see a much superior nature experience, and that's what our goal is. Let's see how much of it we can execute. It may seem like a lot, like we are trying to overachieve instead of going after 1 or 2 verticals. But that's not the DNA of Just Dial. The DNA of Just Dial is the horizontal. So we cater to all kinds of products and services. So what we did was we started hiring people who were working in certain expert verticals, online verticals since they have been there for years, they put it. They know a good knowledge about how it operates. So we may take them as leaders, and these leaders are going to execute it. Of course, in the differentiated way that we want to do it.
Okay. No, this is very helpful, Mani. Just one clarification. So on the B2C side, it is very clear. You will go hyper local, try to connect the customer with either an expert or a shop. But on the B2B side, that is not necessarily a hyper local business, right? So how should we think about that part of the business?
So even in B2B, if you look at a good example, Alibaba, if you look at them, how they go about. So here, you allow manufacturers and sellers to publish their products and obviously sell online, have discussions online, get quotations online, request for quotation online and all of those. So we provide as a platform, whatever is required there. We are also willing to lend our help or rather we call it a JD's gross services through which if you place an order, your product is reaching you securely and we kind of released your payment only after the receptor of the goods according to satisfaction, and such type of services that we're going to package along with it. You have an option to go offline transact to the same vendor after discovering the vendor online at Just Dial's JD Mart or the Just Dial itself.
Got it. Got it. This is very clear. And is it fair to say that like your current mix is about 77% B2C, 22% B2B. Is that similarly how this business will evolve? Or is it going to be much different?
Well, we are very interested to know that. Honestly speaking, currently, a large percentage of our revenues come from services sector. The small percentage comes from JD B2C products, okay? And 22% is -- 22, 23-odd percent is coming from B2B. I think the B2B numbers may grow considerably, both in -- see, it's for both B2B and B2C, it's getting indispensable to Internet as such and being part of any platform. .So I'm sure vendors realize that. And hence, we will have more members, more subscriber to our services as we give a proper shape to our product, we start advertising and all that. It's also possible that all sections are growing at the same time, so probably the percentages may remain constant. My guess is on the JD B2C products, probably the revenue share could increase because we didn't have any such thing done over a long period of time. And the shopping will obviously -- it's really powerful. And if you can have instant delivery and a wow experience and great price discovery and all that, obviously, that also has huge potential to grow.
I think we have a next question Risham [indiscernible].
So I've just one question on JD Mart. You have built a large catalog, and I think a lot of vendors are also there in terms of listing. But in terms of indexing them on search engines like Google, how are we currently progressing over there? Because a large part of traffic comes from Google. So in terms of indexing, how are we progressing?
So indexing part, we're doing -- growing better and better day by day. I mean the -- probably there could be some early movers who are now visible, very much prominent there, but it's only a matter of time once you average content, Google has the bias towards good content. So that will -- you'll see that. And since the period of existence of the site also matters. So what we have done is trying to kind of capitalize on the Just Dial's popularity on SEO, so if you would leverage that for traffic to JD Mart. So something tactically worked on that by our team. We'll get to know the results in the next 2, 3 months how that has helped us.
Any specific category where you think your indexing is now much more powerful than, let's say, just to give us an example, you might be strategizing based on specific sector first. So any example, if it can be?
No, SEO works on content enrichment. And our content enrichment is getting them across all categories, irrespective of whether search engine traffic or not, we need to have that enrichment for a better user experience. Eventually, you got to less depend on SEO and get traffic directly to as a first preference, and that's going to be our ultimate goal to how to get users directly use our app or you come to our site directly. And there has to be a compelling reason and proposition for them, and then you achieve it.
I think given the time constraint, that was our last question. And I think we can end up the call. And I'd like to thank all the participations and the management. Any last comments from your side, Abhishek?
Thanks, everyone, for joining us. In case you have any further queries, please do reach out. We'll do our best to address. And that's it from our side. Thank you.
Thanks, everyone.
Thank you.