IT firms' workforce utilisation rising to pre-Covid levels: Info Edge's Hitesh Oberoi

Hitesh Oberoi, CEO of Info Edge

Utilisation levels of workers by information technology services firms is growing back to pre-Covid levels amid a hiring slowdown in the sector, Info Edge Chief Executive Officer Hitesh Oberoi told analysts in a post-earnings call.

This came after the parent company of hiring platforms like Naukri and IIM Jobs registered a 5 percent rise in recruitment revenue to Rs 481 crore in the March quarter, while fresh billings in the segment grew in double digits after several weak quarters.

“Lot of the IT companies had over hired. After covid, there was a lot of digitalization and demand for IT services. Attrition was high, salaries went through the roof. As demand suddenly disappeared, they realised they had over hired. Utilisation rates fell. I think we are at a stage where some of the companies' utilisation leves are going back to pre-Covid levels,” said Oberoi.

“I can’t say if we have bottomed out… But more jobs are being posted on our platform and IT companies are viewing more CVs than there were doing 3-4 months back,” he added.

Oberoi further said that IT companies are looking for new skills like artificial intelligence, machine learning, data analytics, compared to earlier times when the demand was higher for people with vanilla skills in coding languages like Java and Python.

Info Edge saw billings growth of 11 percent in the IT segment and 12 percent in non-IT segment, whereas the consulting segment was flat in the March quarter, according to the management.

Info Edge’s consolidated revenue rose nine percent to Rs 657 crore during the period. It registered a net profit of Rs 162 crore in Q4, compared to a loss of Rs 447 crore in the year-ago period.

The company grew its operating profit margins to 37.0 percent of revenue and registered a growth of 8.9 percent in its operating profit, which stood at Rs 224.8 crore on a standalone basis in Q4FY24 as compared to Rs 206.3 crore in Q4FY23. The standalone business generated cash from operation (before tax) of Rs 467.6 crore for the quarter, a growth of 13.2 percent YoY.