Sanjeev Bikhchandani: Doubtful of markets’ reception of loss-making firms without visibility on profits: Sanjeev Bikhchandani

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Info Edge cofounder Sanjeev Bikhchandani on Tuesday said he is doubtful about how receptive the public markets will be of loss-making companies unless there is a clear visibility on profits in the next year or two.

“I am not sure people will be willing to give valuations that these companies often expect. But I could be wrong,” Bikhchandani told analysts on a conference call for Info Edge’s announcement of its third-quarter financials.

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Bikhchandani added that a rise in the share prices of portfolio companies such as Policybazaar and Zomato over the 6-12 months period had coincided with the companies’ bottom line improvements.

PB Fintech, the parent company of Policybazaar and Paisabazaar, reported its first quarterly profit, joining the ranks of profitable peers such as Nykaa and Zomato during the December quarter. Food and grocery delivery platform Zomato had reported its first ever consolidated net profit in the June quarter last year.

“When there is a shortage of money, you have to break even and I think enough companies are doing that… I have seen at least close to double-digit startups that are breaking even and making money or perhaps getting very close to it, in our own funds,” he said, answering a separate question on sustainability among startups.

Also read | Late-stage investing is stuck as Indian companies still at 2021 valuations: SoftBank Vision Fund’s Sumer Juneja

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He said Info Edge Ventures was investing a lot slower than was initially forecast when the funds were committed, and that it has been writing smaller first cheques. Also, he added, it was investing in slightly lower valuations in early stages consistent with market conditions.Indian markets have given better public listings than US-based listings, as a significant chunk of startups opt to list domestically, Bikhchandani said.

“The turnover size or valuation requirement for US listings is much higher than India and it is harder to get research coverage… It is pretty clear that even if you allow overseas listings, Indian startups might prefer Indian listings in India because that is where investors are for their companies,” he added.

Following its financial update on the October-December quarter, the company’s stock price fell about 1% to close at Rs 5,334 on the National Stock Exchange.

The Naukri parent company reported Rs 151.1 crore in quarterly profit attributable to equity holders on a consolidated basis. A year ago, it had suffered a loss of Rs 116.5 crore. Operational revenue was up 6% to Rs 627.1 crore.

“Efficient execution in the 99acres and Jeevansathi businesses spurred top-line growth and helped reduce burn during the quarter. While the non-IT hiring sector remained robust, the continued slowdown in IT hiring impacted Naukrl’s growth,” Hitesh Oberoi, MD and CEO, said in a statement.

The recruitment solutions business, which includes, grew about 4% to Rs 469.3 crore, while the 99acres business for real estate grew 21% to Rs 88.8 crore. Others, including and grew nearly 8% to Rs 69 crore.

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