Improved hiring trends in the IT sector has contributed to Info Edge 's topline over the last couple of quarters, says Hitesh Oberoi, CEO & MD, Info Edge, which owns the popular recruitment portal naukri.com.
In an interview with CNBC-TV18's Reema Tendulkar and Nigel Dsouza, Oberoi said there were signs of a marginal recovery in sectors like telecom and insurance .
"But sectors like engineering, construction, real estate are still not shaping up well for us," he said.
Oberoi is hopeful of his Naukri's business improving every quarter from here on.
"Anecdotally what I can tell you is our sales guys meet HR managers everyday and lot of them are getting back saying look a lot of the HR managers are now saying that we need to go back to the drawing board and we are waiting for the business to give a revised plan," Oberoi said.
He said Info Edge was investing heavily in its real estate portal 99acres.com, as he feels the real estate market is a much bigger market than jobs in the long run.
"We are leaders in this market (real estate) but we are not as dominant as we are in the jobs business. So we have been saying that we will do whatever it takes to try and achieve dominance in this category and if this means making short-term losses and investing a lot more in the business we will do that," Oberoi said.
Below is the edited transcript of the interview:
Q: The Jobspeak index is up close to 14 percent odd. Could you take us through the number and also what is happening with the other sectors because I am aware that IT is seeing some kind of attraction but what about the other sectors?
A: We started seeing an improvement in our business about seven-eight months ago and the first sector to look up for us was IT and IT cities of Bangalore, Chennai and Hyderabad. This sector has been doing well over the last two quarters for us. We are seeing a marginal recovery in some of the sectors like telecom, insurance as well. But sectors like engineering, construction, real estate are still not shaping up well for us. So going forward, things will hopefully get better with these sectors also.
Q: Looking at the overall Jobspeak index, do you expect these levels to sustain or can we expect some more improvement in the coming few months?
A: We expect our business to improve every quarter from now on and that has been the case for the last two quarters as well. Anecdotally, what I can tell you is our sales guys meet HR managers everyday and lot of them are getting back saying look a lot of the HR managers are now saying that we need to go back to the drawing board and we are waiting for the business to give a revised plan. I don't know what that really means but I am assuming that they are looking at business to increase their numbers for hiring going forward and that is what we expect to happen.
Q: What about 99acres, I hear that in fact, it is not going to be turning EBITDA positive in this year itself, when will it turn EBITDA positive?
A: 99acres is still in the investment phase. We see real estate as a big opportunity, the real estate market is much bigger than jobs in the long run and of course, there is a lot of competition in the market as well. We are leaders in this market but we are not as dominant as we are in the jobs business. So, we have been saying that we will do whatever it takes to try and achieve dominance in this category and if this means making short-term losses and investing a lot more in the business then we will do that.
Q: In the previous quarter, your recruitment revenues went up by close to about 13-14 percent. Can it cross that 15 percent mark in the coming two quarters? What can be the improvement that we can expect in recruitment in Q1 as well as in Q2?
A: We expect our business to improve every quarter from here on but our business is very closely indexed to the economy, especially the jobs business because we are in a very mature market as far as online recruitment is concerned. The hope here is that the economy will continues to improve every quarter from now on and that leads to our business improving every quarter. Yes, that has been the case for the last two quarters and unless something untoward happens, we expect this to happen going forward as well.
Q: What is the sensitivity of a 1 percent increase in GDP to how much it can impact your business or improve your business?
A: The right kind of GDP growth does make an impact; every 1 percent probably makes an impact of about 7-8 percent on our growth rates in Naukri.
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