Release Date: August 09, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Matrimony.com Ltd (NSE:MATRIMONY, Financial) is exploring new business initiatives beyond the matrimony field, leveraging over two decades of experience in the consumer intent space.
- The company is strengthening its processes and offerings in personalized services, which have started showing traction.
- Despite a decline in revenue growth, profit after tax increased on a quarter-to-quarter basis due to efficient operations and marketing optimization.
- The company launched MeraLuv.com, an exclusive dating app for Indian Americans in the US, which is expected to drive growth.
- EBITDA margin for the matchmaking business improved to 22.6% in Q1 FY25 from 19.1% in the previous quarter.
Negative Points
- Matrimony.com Ltd (NSE:MATRIMONY) experienced a decline in year-on-year revenue growth for the first time in many years.
- Billing for the matchmaking business declined by 2.5% quarter-over-quarter and 4.8% year-on-year.
- The number of paid subscriptions decreased by 1.8% quarter-over-quarter and 5.6% year-on-year.
- Revenue from the marriage services business saw a significant year-on-year decline of 27.7%.
- The company expects a slight decline in matchmaker revenues on a quarter-to-quarter and year-on-year basis in Q2 FY25.
Q & A Highlights
Q: What sort of growth do we expect in the core matrimony services business? Has the pricing growth been weaker because of competitive intensity or consumer demand issues?
A: Growth is driven by profile acquisition and conversion of free members to paid members. This quarter had fewer auspicious wedding dates, impacting registrations and revenue. If profile acquisition and conversion rates improve, we could see double-digit growth. However, this depends on our ability to convert free users to paid users and attract more sign-ups.
Q: What are the new initiatives to drive growth, especially in areas like astrology?
A: We are working on MatchAstro, an astrology service integrated into our core offerings. It will be an independent app focusing on marriage, love, and relationships. Additionally, we plan to launch luv.com, an exclusive app for serious relationships, by the end of Q2.
Q: Over the next two to three years, how do you see the margins of the business evolving?
A: The business has operating leverage, so margins will improve with revenue growth. Currently, excluding marketing expenses, our gross margin is 62%, which could increase to 65% or higher.
Q: Do you expect advertisement costs to remain high, impacting margins?
A: Marketing expenses have softened recently. If this trend continues, we may reduce marketing spend, which would improve margins. However, we will continue to monitor the market and adjust accordingly.
Q: Why not explore fast-growing adjacent business areas like online astrology?
A: We are focusing on marriage, love, and relationship segments within astrology through MatchAstro. This targeted approach aligns with our core business and leverages our existing user base. We prefer to specialize rather than compete broadly in the astrology market.
Q: What is the current competitive intensity in the online matchmaking market?
A: Competitive intensity has decreased, particularly in TV advertising. We will continue to monitor the market and optimize our marketing spend accordingly.
Q: Are there any plans for buybacks?
A: The Board will decide on capital allocation, including buybacks, at the appropriate time based on our capital allocation policy.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
