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Last Updated : Sep 28, 2016 07:51 PM IST | Source: CNBC-TV18

Just Dial still maintains a dominant place in local search: CFO

In an interview with CNBC-TV18, Ramkumar Krishnamachari, CFO of Just Dial said that the company has taken steps to address growth on core search which has started yielding results.


Brokerage firm UBS has downgraded Just Dial from neutral to sell and have steeply cut their target to Rs 450 per share to Rs 710 per share.


In an interview with CNBC-TV18, Ramkumar Krishnamachari, CFO of Just Dial said that the company has taken steps to address growth on core search which has started yielding results.

He said that Just Dial still maintains a dominant position as far as local search is concerned.

Below is the verbatim transcript of Ramkumar Krishnamachari's interview to Latha Venkatesh and Anuj Singhal on CNBC-TV18.

Latha: Your core search business, that deterioration is playing a little faster than many analysts thought it would, at least that is what the UBS report says, can you give us an update on how that service is performing?

A: Without going into the specifics of this quarter, because we are in a quiet period, all we can say is that the steps that we have taken to address the growth on the core search has already started yielding results. You will see in the subsequent quarters that because essentially, the issue was more internal rather than what analysts and the larger people think of competition etc -- we don't believe they have had any material impact as far as our business is concerned.

We continue to maintain the dominant position as far as local search is concerned. Internally, we do admit that we should have executed better as far as the sales growth and sales infrastructure is concerned, which we have already corrected. The steps have been taken to arrest the declining growth and you will see the trend reversal happening in the next few quarters.

Latha: Therefore, what is the strategy? The analysts keep talking about you probably doing an aggressive advertising campaign or probably tie up with a strategic partner. Is anything substantial other than expanding your sales force on the anvil in terms of a strategic tie up to improve use of your search business?

A: Other than the expansion, there are three other strategies, which I want to highlight. One is definitely there is going to be advertising campaign, we are already ready with it. So it is only a tactical matter of when we start it. We can start it anytime, so we are ready with that and that should change the perception of JustDial from being a search to search and transact platform. You will see us more aggressive as we move forward in next few months and quarters. That is one.

Second is, on the search itself we are using that as an user engagement platform. There is a tremendous value proposition to make sure that from a user perspective, having a single platform to do all the transaction on the day-to-day basis, I think with the advertising campaign, they will come to know of the value proposition and we are confident that we will increase our user engagement with that.

Second part is also enriching the content, so we are working on JD Social, whereby you will be able to interact with your friends and relatives and friends of friends and have an enriched content particularly focused only on the business. So there will be a social platform focus only on commercial and business related subjects.

Third is, we worked on our Omni strategy to make sure that we address the needs of the services industry. Services contribute more than 80 percent of the revenue. We have a product with which we are going to go aggressively in the market right now on the Omni products.

With these three, along with the expansion in core search, we believe that we will come back to our growth path that earlier we used to witness. So we are quite confident, there is no need from our standpoint to look at any strategic partners. We believe that there are a lot of things to be done organically for us and we are quite confident that the steps that we have taken, in the coming quarters we will be able to walk the talk.

Anuj: By which quarter do you think these numbers will show up because your Search Plus which was supposed to be a big game-changer has also been a bit slow starter?

A: You have to understand that the whole ecosystem in the last two years has been all about deals, discounts etc, which we never wanted to participate. Our philosophy is that these are not sustainable and we have proven right.

The kind of customer acquisition practices that is going on, those were completely unsustainable and we believe rather than going there, build a solid product -- which we have painstakingly done in the last two and a half years -- whereby we provide the value proposition of convenience, efficiency, price discovery to the consumers and that is what will matter from medium-term to long-term.

This thing of deals, discounts and other customer acquisition practices is going to already wear-off in the next one year or so and we are already witnessing that. So we are in it for a long-term and we believe that end of the day, if you have a great product, the consumers will definitely see the value in it and they will start engaging with the platform as we have been doing on the search platform for the past 20 years. So it is only a matter of next few quarters and we are confident that we have a great product to go to the consumer.

Latha: Which particular services you said will start transacting on your apps?

A: We already have 32 services where you can search and transact.

Latha: Services such as?

A: Such as doctor's appointment, food delivery, grocery delivery, flight booking, train ticket booking, bus ticket booking, everything that you can think of, movie ticket booking. So I just booked a movie ticket last Saturday under 50 seconds. So all I am saying is there is a tremendous value proposition having a single platform where you can do all search with transactions.

Also, the search and transaction is getting integrated. So the ecosystem is there, it is not like you search in one place and transact in another place. It is gravitating towards single platform where you can search and transact and that is why for making a decision -- there is a social element to it -- your friends and recommendations of your friends and relatives is going to play a critical part. Once you decide, which business then you transact with them. That is what I am talking about.

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First Published on Sep 28, 2016 12:01 pm
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