Matrimony.com Limited — Call Transcript 2018

Aug 24, 2018

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August 24,2018

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NationalStockExchangeof IndiaLtd<':,~Exchange Plaza, 5th FloorPlot No: C/1, G BlockBandra Kurla Complex, Bandra (E)Mumbai - 400 051	'YUII~rateRelationshipDepartmentBSE Lt.,Phiroze JeejheeTowersDalal Street, Mumbai -
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Dear Sir/Madam,

Sub: Call transcript of Investor/Analyst conference call under regulation 30(6) of SEBI (Listing Obligations & Disclosure Requirements) Regulations. 2015.

• Ref: BSE Scrip code: *5407041*NSE Symbol: MA!RIMONY

Pursuant to Regulation 30(6) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, the. call transcript of Investor/Analyst Conference call with the Company held on 13th August 2018 is attached herewith.

The aforesaid information is also being hosted on the website of the Company viz., www.matrimony.com.

Submitted for your information and records.

';

Thanking you

Yours faithfully,

For Matrimony.com Limited

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S.Vijayanand Company Secretary & Compliance Officer ACS: 18951 No.94, TVH Betlclaa Towers, Tower II, 10th Floor, MRC Nagar, Chennai - 600028

matrimony.com ltd.

( CIN: U63090TN200:._1_P_LC_O_47_:._4__:_3::_2!_) ~ ~

"Matrimony.com Ltd Ql FY19 Earnings Conference Call"

Aug 13,2018

MANAGEMENT:

MR. MURUGA VEL JANAKIRAMAN PROMOTER & MANAGING DIRECTOR MR. BALASUBRAMANIAN K CHIEF FINANCIAL OFFICER

Matrimony.com Ltd, Q I FY 19 Earnings Call Aug 13,2018

Moderator: Ladies and gentlemen, good day and welcome to the ConferenceCall to discuss QI FY19 financial performanceof Matrimony.comLimitedhosted by Batlivala&KaraniSecuritiesIndiaPrivateLimited. As a reminderall participantlineswill be in a listenonly mode and there will be an opportunityforyou to ask questions after the presentation concludes. Should you need assistance during the Conference Call please signal an operator by pressing * and 0 on your touch tone phone. Please note that this conference is being recorded. I would now like to hand the conference over to Mr. Tushar Wavhal. Thank you and over to you sir.

TusharWavhal: Thank you everyone forjoining us on the QI FYI9 ConferenceCall of Matrimony.comLtd. We have with us the senior management of Matrimony.com Mr. Murugavel Janakiraman - Promoter and ManagingDirector;Mr.Balasubramanian-Chief FinancialOfficer.We willstart the call with opening remarksfrom the management,post which we will open the call for Q&A. With that I will hand over the call to Mr. MurugavelJanakiraman.Over to you sir.

Murugavel Janakiraman: Thank you Tushar. Good evening everyone and welcome to our QIFYI9 investor call. I'll take you through the consolidated quarterly performance of the company initially and then we'll cover the performance on each of the two segments we operate. In the end we'll be happy to take questions. Matrimony.com,the leading online matrimonycompanyhas achieved a consolidatedrevenue ofRs

89.6 crores for the quarter, a growth of 6.8% against the correspondingquarter of the previous year. The earnings before interest, tax and depreciation, EBITDA for the quarter was at Rs. 21.2 crores against Rs. 19.7 crores for the corresponding quarter of the previous year; a growth of 7.2%. The EBlTDA margin for the quarter was at 23.6% and it's akin with the corresponding quarter of the previous year in spite of the increased marketing spend by 14.9% year on year. The company's consolidatednet profit before tax for the quarter was at Rs. 21.2 crores against Rs. 17.5crores of the correspondingquarter of the previous year; a growthof 21.2%.The company's consolidatednet profit after tax for the quarter was at Rs. 15.6crores againstRs. 14.9croresfor the correspondingquarter of the previous year. The carried forward loss of the earlier year has been adjusted in the last fiscal and the current year incometax provision is based on normaltax rate applicableto the company.Business iswitnessingan intensecompetitionin the north end and in somepartsofthewesternmarketscombined with a discount on subscriptionpackage.This heightenedmarketing spend by competition,which did discount in those markets, has impacted our growth in the match making segment particularly in the north and westernmarkets.The companyhas launcheda mobile app, a lighter version with vernacular option in eight languagesin the month ofJune 2018 and also launchedglobalMuslim_E1atchwith eight

Matrimony.com Ltd, Q I F' 19Earnings Call A~ 13.2018

region specific types to cater to the 1.5 billion Muslimsin the Middle East. I'SA. Europe. Indonesia. Bangladeshand Malaysia.The company is establishinga whollyowned subsidiaryin L'AE.We expect to commenceoperation in September2018.Coupledwith this initiativeand highermarketspend in the comingquarter we expect to get back to much higher. much healthiergrowth. 'Hie segmentresults for matchmaking- matchmakingsegmentrevenue forthe current quarterwas at Rs.S~.9 crores as against Rs. 79.0 crores for the correspondingquarter of the previous year. resulting in a growth of 8.8%. 10 million mobile apps have been installed as on 3rd August 2018; pre-registrationin the current quarter exceeded the I millionmark and grew by 13.3%over the correspondingqUarlcr"l:l"ftheprevious year. Of the total pre-registration over 80% was done through mobile apps and WAP. Out of the overall profiles added in the quarter, 60% were posted by singles themselves. 170,,,profiles were added by parents and 23% profiles were by siblings, relatives and others. Around 27.00{)SI1CeCSS stories have been reported to the company in QI of the current financialyear. EBITDA forthe quarter was at 27.7 crores as against 26.1 crores for the correspondingquarter of the previous year, ~BnDA margin for the quarter was marginally lower at 32.2%against 33.1% forthe correspondingqooner of the previous year, as a result of highermarketingspend.Movingon to marriageservicessegment:marriageservices revenue for the current quarter was at Rs 3.6 crores as against Rs 4.9 crores. The marriage services segment, which is in a nascent stage, has undergone a business process change to firm up the profit business model. This segment is expected to have a healthy growth from Q3 onwards as Q2 is historically a lean quarter for marriage services in the southern market. For the quarter was at Rs 3.1 crores as compared to Rs 3.6 crores for the correspondingquarter of the previous year. We are now open to take any questionsthat you may have. Thank you.

Moderator: Certainlysir. We will now begin the Question& Answer Session.Participantsusing speakerphone are requested to use the handset when asking questions. To enter the question and answer queue please press * and I on your phone now. If you'd like to withdrawyour question and exit the queue press * and I again. We have our first question from Mr AnshumanR fromMarathonEdge. Please go ahead.

Anshuman R: Congratulationsto the management on their result. I've a quick question, sir can you tell us what has been the conversionrate in terms of what are the new subscribersand what are the paid subscribersfor the quarter gone by?

Management: Anshuman thank you. We're not sharing the percentage of the conversionfrom free to paid because we believe it's all competitive information. We don't like to share what percentage of members have converted because the conversion has various components. We have free members and we have

Matrimony.com Ltd, QIFYI9 Earnings Call Aug 13,2018

memberswho have converted into paid members.Within the paid members we're talking about first time renewals and second time renewals and people going for the conversion very first time. So conversionhas multiplecomponents.So this informationagain we're not sharing in the public domain as we believe it's a competitiveinformationwhich we don't like to share here.

Anshuman R:	Sure;just anotherquick question followingup on that- what about the average transaction value for thequarter gone by?
Management:	The average transactionvalue forthe quarterone was 4,477.
Anshuman R:	Thank you sir.
Moderator:	Thank you. We have a question from Sahil Desaifrom Hornbill. Please go ahead
Sahil Desai:	Hi, thanks for taking the question.Just wanted to check on the revenue growth; if you can help usunderstandone on a comparablebasis given that ex of the GST adjustments,what kind of comparablegrowth isthere and secondly sincewe're seeing pressure in the non-south market which is outside ourcore markets, would you be able to give us a split of how the growth was in your core South Indianmarket versus how it's panned out this quarterin the rest of the country?
Management:	Thank you Sahil.Taking the GST into considerationthe growth wouldhave been 11%.And moving onto second question in terms of what would have been growth for south versus other parts, obviouslywhile overall the match making grew by 8%+ and the growth was higher in the southern marketcompared to the northern market. While we're not sharing the exact split between what is thepercentage of growth but the growth was higher in the southern and eastern market compared to thenorth and westernmarket.

matmmony.com

Matrimony.com Ltd, Q 1FY 19 Earnings Call 1\n-g i3, 2018

Sahil Desai:	Okay and in the northern and western market isthere a decline'?Can you share the direction'!There'sa decline in that market?
Management:	No, it's not a decline; comparedto the overall marketgrowth.the growth was not 1'tIat high.
Sahil Desai:	Okay positive growth but muted growth basically.
Management:	Yeah it's a sort of muted growth to a large extent.
Sahil Desai:	Okay and has that largely come through volume share loss or is it mainly realization cuts?
Management:	It's a combination of both because we definitely see intense competitionin north,"byand large innorthern market and to some extent in western market.It's a combinationof volume growth as wellas realization because there is huge, high discounts happening in the northernmarket.
Sahil Desai:	Got it. And in South India,I understandyou may not be sharingnumbersbutjust in terms of momentum,is it better or is it slightly weaker, if you can share something like that in terms of at least the growthmomentumin south India which is our core market.
Management:	No, no, the growth momentum definitely has been very good in the southernmarket and also in theeastern market, both in terms of profiles and revenue,.The regions where we are having a challengeare the north and western market. Higher marketing spend by competitors not commensurate to therevenue.So that's somethingwhich we've been watchingand we also need to take stepsto gain marketshare or to retain our markets in the north and western market. We're definitely watchful of theincreased marketing spend happening in the northern and western market and we need to respond tothe increase in marketing spend by the competitors. We need to up our marketing spend in thosemarkets because we being a leader, it's important to retain our market share and grow our market

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Matrimony.com Ltd, QIFY19 Earnings Call Aug 13,2018

share. We've been having a 60% market share in the online match making business among the organizedplayers.We believe it's importantto step up our marketingto gain our marketshare across India and mainly in the westernand northernmarket.

Sahil Desai: Sure,sure,that's helpful;thank you. That's all from my side.

Moderator: Thank you sir. We have our next question from Mr PranavKshatriya from Edelweiss. Please go ahead sir.

Pranav Kshatriya: Hi, thanks for the opportunity.My first question is partly answered but I still want to know that the relativelyslower growth, will you attribute it to loss in the marketshare or it's a decline in the market size itselforrelativelyslowergrowthofthe marketI would say.And my secondquestion is- you talked about launching the app in the year in more languages and the launch of a lighter app as well as expansion in the Middle East. Can you give us some colour on how much are the investment requirementsand what do we expect in terms of its implicationon the EBITDAmargin or the capex?

Management: See in north apart fromBharat Matrimonywe have Shaadi and Jeevan Saathi.In the lastthree quarters there is an increasingmarketing spend by Shaadi.com.. Post our listing there is increase in marketing spendby Shaadi.com;even JeevanSaathi,they've increasedtheir marketing spend.Competitorsat this point of time in the north and west are spendingmore than us, sothere is an impact in terms of number of profiles and realization,due to high discountin those markets.Our marketing spend at this point of time in the northernmarketis less comparedto the competitors' marketing spend.As I saidthe kind of money the competitor is spendingcompared to the revenue is very high. So as a leading player, with 33% EBITDAmargin in matchmakingbusiness,we need to step up our marketing spend in north and western market to improve our share and also to grow share in the long term. If the intensity of the competitioncontinueswe will step up our marketingcampaigns.Comingback to yoursecond question on vernacularlanguages. India has large vernacular users and there are around few hundred million internet users. Another few hundred million users are expected to come into the system in the next couple of years. Most of these users are going to be vernacular users. So far no one has got the vernacularstrategy,right. Again we've launched these vernacular light apps. It's too early for us, it's just launched.We have to get the feedback on the usage and their experience on the product. We've launchedthis app to ensure that we're not missing on the vernacular growth opportunity in India. It's an effort to corner the increased vernacularusers in India. Based on the feedback fromthe consumers

Matrimony.com Ltd, Q1FY 19 Earnings Catl Aug n,2f:H8

we'll fine-tune the app and ensure that we're gettingthe strategyright. We're a strongNumber I player in Sri Lanka though the revenue is very small. We wantto take the successOr running abusiness in the international market like Sri Lankan Matrimony plus in other countries also. We want to take the success of running our operationsin the internationalmarketthe \ay we segmentedmatch making in India.We planto focuson the global Muslimmarket.The marketis crowdedwith many players.Again most ofthe players are small players.Wejust wantto test and understandthe market beforewe commit large investment.At this point of time it'sjust launchingthe app: a small marketing spend and wejust want to ensure that we're getting everything right beforewe scale up. It win not have much impact on the EBITDA due to the marketing spend on the global Muslim market.

Pranav Kshatriya: Sir if I can ask you one more question, can you give us some comment on your other services part where there is still some cash burn. How are you seeing growth ill the different parts of the marriage services businesses,the wedding photo shoot and otherservices?Any comment witt be helpful.

Management: Sure; Wedding services has three businesses, Matrimony Photography, Matrimony Bazaar and Matrimony Mandap. All I can say is that all these businesses in our view are probably in the right direction. We want to get the business model right before we scale up the 'business.In photography, some of the changes what we've done, we believe that it's really helping us to move in the right direction. The changes have significantly improvedthe wedding photographybusiness. We're doing the right thing in terms of collecting the money priorto the execution of the wedding because we had a collection challenge in the past. We're makingsome of the changeswhich we believe isimportant in the long run and for long term success of the business. We believe photographyhas progressed in the right direction and even the other businesstoo, MatrimonyBazaar and MatrimonyMandap.Also want to highlight a point that in wedding services no one so far has got the model right. We believe that we're in the right direction because of the advantageof matrimony.com in which we have a database of people who're getting married through matrimony.com. While the reported marriages through matrimony.comlast quarter was 27000 marriages,the number of overall marriagesreported, including people who got married through other sources,by other means were 100,000,including 27000 people who got married on account of matrimony.com. We have a large database of customers who are reporting getting married. We have this opportunity to leverage the user base once we get the model right; So oncewe have achievedsome internalmilestoneswhatwe've taken,we'll scaleup the business acrossthe market as the business at this point of time by and large confined to southern states or only one or two states.It's not a pan India business.Oncewe take the businessto a pan India level,I believe growth will be much better. Again at the scale and size, we definitely see a much improved metricsin terms of business and performance.

Matrimony.com Ltd, Q IFY 19 Earnings Call Aug 13,2018

Pranav Kshatriya: Thank you so much sir. I'll come back in the queue. Moderator: Thank you. We have a question from Prajwal Gote from B & K Securities. Please go ahead. Prajwal Gote: Hi sir, thanks for taking my question. Ijust wanted to understand about the tax rate as you said carried forward loss is over now. So is it fair to assume that your tax rate would normalize in the coming period. Can we get to see the tax rate stabilizing at like 30% odd, is that the right assumption? Management: That's right; your assumption is correct. The carry forward loss has been fully consumed in the last financial year. We'll be paying the full tax from the current fiscal. Prajwal Gote: Okay. And second question would be sir on secondshaadi.com, sir as you had indicated earlier that you've just completed acquisition ofthat.ljust wanted to understand the contribution and what is the ATV and how's that business progressing? Management: It's a small part of our business. It's a part of community matrimony.com. We're managing various sites including Divorcee Matrimony which is the largest player in the divorce segment. Actually Second Shaadi which consolidates our position with respect to second marriage. Prajwal Gote: Okay understood sir. Sir and can you please elaborate more on the Middle East part as you said right now. What would be the ATV there sir? What is the ATV we're expecting and what is the revenue contribution expecting from there? Management: No Middle East is again one of the important overseas market. Next to USA is the Middle East market because we have a lot of expats in the Middle East market. Lot of south Indians including Malayalees and Tamilians, because South India is one of the very strong markets for us. So having an office in

Matrimony.com Ltd, QIFYI9 Earnings Call Aug 13,2018

Dubai,obviously we'll be able to monetizeit better.Again it's one of the importantmarketsoutside of India and also mainly we're keepingour global Muslimmatch opportunity.In the long.run you know it could be our internationaloffice to manage the global Muslim match operations. That way Dubai works very well because we'll be able to effectively manage global Muslim match operations from Dubaimarket.

Prajwal Gote: Understood.Just book keepingon Middle East marketsir, what isthe investmentyou've done there and can you please guide us on the ATV and how big isthat market?

Management: Again the NRI market is small but overall of course NRI is an important market. It's market size is reasonableand investment is just 50,000AED to begin with. Again as I said, it is next to US. UAE is one of the important market for us. But again in terms of overall revenue for matrimony.comit's not so big. We're looking at an office in Dubai keeping it in order to increase the revenue in that market. Yesthere'll be some increasehappening;It'll be a very small incrementcomparedto what we're doing with respect to our matrimony.combut in the long run it will help us in the global Muslim match operations. So in terms of ATV it will be better than India as we charge slightly more compared to what we charge in India So if we look at overall ATV it's around 4000 plus at a consolidated level; If we look at India, plus outside India - outside India is definitely much better than India.. We're not sharing the region specific ATV but we're sharing only the consolidated ATV. Net-net the ATV definitely is more comparedto India.

Prajwal Gote: Understood sir. My last question would be on the match making services, the marriage servicesfront sir. Sir and are you reiteratingyour guidancewhich you had given before about the losses, you said that it will be at 3 odd crores. Sir how will that be going forward? Is the expectation still same or any further development?

Management: More or less it will be the same.We've not changed it, it will more or less operate at 3 to 4 crores only.

Prajwal Gote: Okay sir understood.That's all from my side; thank you so much sir.

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matrnmonJ'" com

Matrimony.com Ltd, Q 1FY 19 Earnings Call AugJ3,201S

Moderator:	Thankyou. A question fromAmarjeetMaurya fromAngel Broking.Please go ahead.
Amarjeet Maurya:	Hello sir:just wanted to understandmore on wedding services related. So just give me a bifurcationbetweenthe Photo,Bazaarand Mandap,both in terms ofEBITDA loss as well as revenue.Last year itwas around 16croresrevenue and EBITDAloss was around 17crores. So what wasthe mix?
Management:	Amarjeetyou know the businessis very early stage. At this point we will not give you a segment levelbreak up. But mostof the businessin wedding servicesis coming from photography.
Amarjeet Maurya:	Okay so, do you have any number about how much, last year how much you did photo and videographyin terms of numbers?
Management:	Most of the revenue in wedding services was through photographybusiness. But we're not giving thesegmentbreak up for each.
Amarjeet Maurya:	Ijust wanted to understandthe numbers and you know what wasthe average cost, average realizationand apartfromthat how much numbers you're doing and how much numbers more you'll do so you'llget break even. So on that front and apart from that what is the big fixed cost and variable cost in thisbusiness?
Management:	See most of the cost for wedding services are the fixed cost. Mostly it's the people cost (25:28). In termsof break up by business, at this point of time considering that it's in a very early stage and alsoconsideringthere's competition,there's lot of competition in the wedding services; we're not givingthe breakup of these businesses. And in terms of (25:52) definitely photography has moved up wellbecause we have tightened the cost. One of the reasons why revenue on the wedding servicesis lesscomparedto the correspondingquarterbecause we're doing some of the importantchangesforthe longterm benefit of the businessincludingtightening of the packaging cost and collectingthe money wellin advance so that we're not having collection issues when the wedding is executed. So we're doingsome importantchangesto make the business viable and successful in the yearsto come.

Matrimony.com Ltd, Q 1FY19 Earnings Call Aug 13, 2018

Amarjeet Maurya: So when you're expectingEBITDAlevel break even?

Management: EBITDA level break even in terms of photography,we are looking at making the business profitable at the state level as we're operating in four southern states. So even if tomorrow we are able to achieve break even in one of the states, we can achieve break even in all the southern states. By the time we take that across India this will once again get into losses because we're e"panding into newer geographies. So the business will continue losing money because today the business is operating only in fewmarkets and whenwe take the businessto pan Indiathe businesswill corrt'inue'lOlose. Expecting the business EBITDA at aggregate level may be a challenge in the near time. But the business may become profitableor break even at state level,yes that is possible.That's what we're trying to achieve; we want to get the business at a break even or close to breakeven in the market in which we operate before we expand the businessin other markets.When we take it to other markets business once again will get into losses.So to comeback to your question- is businessin the near term goingto be EBHDA breakeven?No; In wedding servicesthe opportunities are predictable, looking at how to scale up this business without losing a lot of money would be our objective. At the same time getting our business model right at a geography level that's important for the success of the business model. So we're looking at achieving that objective; get the model right, become profitable then scale the business model.

Amarjeet Maurya: Sir what you said your fixed cost, employee?I mean what is your fixed cost in this?

Management: The fixed cost if you're talking about is people who are photographers, designers etc. There are people who are part of other businesses also.

Amarjeet Maurya: You are already hired for the one year, two years photographerin advance?

Management: It depends on certain scale and size. We have a combination of full time guys, plus we have retainers, it's a model combination of both.

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Matrimony.com Ltd. QIFYI9 Earnings Call Aug 13,2018

Amarjeet Maurya:	Both fulltime and part time?
Management:	Full time and part time and the freelancersso that businessis optimized.Becausewhen we set up thebusiness.the businesshas initial costs.
Amarjeet Maurya:	Becausewhat I understandis- wedding is a seasonalbusiness. So wheneverwe require we can hirethe employee.So somehowwe can managethe lossesinstead of hiring a full time.
Management:	Yes I agree with you. That's why we're looking at how to balance in terms of full time versus thefreelancers,the retainers;you're absolutelyright, managingit effectivelyso that the cost is maintained.Again it's a good thing that what is non-seasonal in one market is seasonal in other market when itbecomes a pan India business. It's a given thing that while December is not a season in south, it is aseason in the northernmarket.Business gets balanced at a certain scale and size. But we definitely aremindful of the point what you've mentioned;we've also structured the business accordingly.It's notthat wehave everybodyon the rollsof the company.We balance in such awaythat the cost is optimizedin all the things. At the same time taking into considerationthe delivery aspect of the business.
Amarjeet Maurya:	Okay sir, thank you.
Moderator:	Thank you. We have a question from Mr. Archit Singhalfrom SafeEnterprises.Please go ahead.
Archit Singhal:	Hi, thanksfor the opportunity.A few questionsfrom my side. Firstly on matchmaking,sir could youtell the contributionof northern and westernmarketsto your revenues and what would be your marketshare in these markets?
Management:	We are not giving the exact marketshare in terms of the revenue mix. But I would say that majorityofthe revenue for us comes from South and Eastern markets put together; North and west definitelycontribute a certain percentage of revenue which is a meaningful size. But we are not giving exactbreakup of the revenue for competitive reasons.Because of the intense competition,only certain part

Matrimony.com Ltd, Q1FY 19 Earnings Call Aug n. 201,8

of the market is affectingour growth at this point of time at an overall level. But having said that once we step up our marketing.we get more profiles and the growth can be better.

Archit Singhal: And sir we do not disclose the marketshare also in these markets?

Management: No because the marketshare at an overall level is based on revenue and certain inWrmation.Wc have a 60% marketshare. We don't have the dominantmarketshare. In our view thc marketsharewould be divided between all the three players. While we may not know the exact percentage bitt we believe more or less around 30-35 kindof range.The best estimate at this point of time - in the north and west. the markets are all dividedamongstthe three players. So around 30-35 or 40. depends Oft who has what kind of market share and all that.

Archit Singhal: Understood. And sirjust wanted to understandon the marriage services business you just mentioned that you will continueto losemoney in the nearterm.But isthere any timeline or any let"s say revenue level after which we can startseeing EBITDAbreak even? I mean any timeline in your mind?

Management: No I don't think there is any timeline at this point of time because there is opportunity in the wedding services. Each of the opportunities can run in very large revenue size. So that being the case, it is too early to say that this business will become profitable because we are not chasing a 50 crore or a 100 crore business opportunity in the marriage services vertical. These opportunities can be very large opportunities again as we progress. As I said at this point of time, the focus is to get the model right. So even when the model becomesright, the opportunity if you look at photograph, it is a multi-million dollar opportunity. So when to say the business is profitable - when the business becomes pan India and it becomes on an aggregate level,to consolidate in one state it is profitable and in anotherstate not being profitable. I am not sure when that will be. But at this point of time, in the near term it doesn't look so. Maybe as we progress,maybe one or two years down the line we may have a better view. But all we can say at this point of time isthe focus should be to get the model and the growth and scaling up acrossIndia.

Archit Singhal: But sir is there any revenue level which you would be happy with? Or maybe any revenue level after which we can see the cash bum reducing at least?

Matrimony.com Ltd, Q 1FY19 Earnings Call Aug 13,2018

Management:

The cash bum at this point of time, in our view is not very eye-catching because in the internal business it is important to address the leadership, important to get the model right. Because wedding is a very large opportunity. So in our view we see 3-4 crores, as a company we are doing very well in creating a business model without losing a lot of money. You may know that in the entire business where people burn a lot of money 10 get the model right. In our view we are developing three businesses with average loss per quarter of around 3-4 crores, As company management we are doing a very good job of creating a very large opportunity hopefully in the future, by burning only limited cash. So that being the case, our focus is to get the model, scale it up. I am not in a position to say at this point of time when it will become profitable and under what level we will be happy because it's too early to say on those things. So I think the primary focus at this point of time is getting close to our breakeven or achieve the metrics what we want to achieve and scaling up the business across India. That is the thing now. So target revenue on wedding services, no may not be also. May be even 1000 crores probably. Only time will tell.

Archit Singhal: Understood sir and final question again is regarding matchmaking services. You said that because of the competition you will have to incur some marketing expenditure to maintain your market share. So is it like the EBITDA margin which we saw in first quarter? I mean can we see a similar kind of margin for the full year or can there be a pressure on the margins because of the marketing expenditure?

Management: At this point of time because there is a competitor spending disproportionately high i.e. marketing spend compared to the revenue. So that being the case, internal business it's important to defend the market share. So you need to invest big in marketing if the competitive intention in those markets continue. If you have to respond to marketing to match that trend or more, that can definitely impact EBITDA margin. So yes, again we are watchful of. It depends on how they are in quarters to come. It is again how the competition is going to behave. So yes if increase in marketing spends continue, that will impact on EBITDA margins by a few percentage points.

Archit Singhal: Okay. This is very helpful sir. Thanks a lot and all the best.

Management:

Thank you.

Matrimony.com Ltd, Q 1FY 19 Earnings Call Aug13,2018

Moderator:	Thank you. We have a question from Shailesh Kumar from Sunidhi Securities.Please go ahead.
Shailesh Kumar:	Thanks for the opportunity.Is it possible for you to share what percentage ofyourtop fiae comes fromSouthern market?
Management:	Majority of the revenue comes from southern market but we are not giving exact percentage becauseof the competitive reasons. We don't want to clearly spell out what is south.
Shailesh Kumar:	Alright. And have we been able to outline our dividend policy? Because last concall you have said thatyou will discuss with the board and come out with the cfear dividend policy. And we don't have anymajor capex lined up. And having a healthy cash flow generation.So
Management:	The dividend policy has been discussed in the board and that is how the policy of Rs. 1.50, 30% of theface value of the shares has been decfared and that will be paid in another 10 days' time. As you knowthat the cash is being retained in the business for its own growth. Like Mr. Murugavel was mentioningabout spending, marketing could be an additional spend required. And for all profit opportunities acrossthe system. So board will definitely review this policy year on year and take an appropriate action as itdeems fit.
Shailesh Kumar:	So should we presume based on this discussion that we are also looking for inorganic opportunitiesinthis space? I mean we are open to inorganic opportunitiesin this space?
Management:	Yes. As a company we bought one of the small opportunities,Secondshaadi.corn.As we progress, ifthe opportunitiesmake sense, yes we will definitely be open to look into it.
Shaifesh Kumar:	Thank you very much.

Matrimony.com Ltd, Q I FY 19 Earnings Call Aug 13,2018

Moderator:

Thank you. We have a question from Mr. Rohan Advant from Multi Act. Please go ahead.

Rohan Advant: Thanks for taking my question. Sir I had a question on the paid subscription. If you look at your YOY growth, the paid subscriptions have grown from 1.90 lakh to 1.91 lakh. So it's more or less flat. So all growth in this quarter is price led. Given that there will be pressure on pricing how do you plan to increase your conversion rate and you know how do you plan for a revenue growth in this environment then?

Management: Okay thank you Rohan. One thing is that we are also looking at in terms of the north and western market because of the competition and then huge discounts being given by the competitors which are affecting the growth in the northern market. So if we look at it segment wise. in south we have a better growth compared to the northern and western market. So one of the things we are looking at due to increase in conversion, we are looking at continuous investment in product and artificial intelligence and (38:50) app so that we are able to offer a superior product and experience to the customer. Also use the machine learning or AI based technology to improve the conversion. There is ongoing investment in improvement which we are doing in our organization. Hopefully these efforts can possibly culminate or help us to combat better. So the thing is we have to definitely get more profiles and focus on converting those free members into paid members. Getting a profile is a function of marketing and again the brand which we built and conversion based on sales effort again continuing some of the technology like artificial intelligence and better products. These are things we continue to work on and push to get better conversion. So we are investing big on the product side; we are investing big on AI side. So those are things which are happening. Those are things which hopefully can help us to convert better.

Rohan Advant: Okay. And my second question is I wanted to understand the sensitivity of our growth to advertising. Because say in a market like southern market where we have a very strong position, even if a competitor advertises heavily it is unlikely that a prospect would go to that competitor because there isn't a number of profile that is there with the competitor to make a value add for him. But in the north and west maybe we don't have a relatively strong competitive advantage or market share as we have in the south. So there is there a requirement to actually match competition and advertisement or else we would lose market share. And if the same happens in the south would we have to increase advertisement in the south as well or you feel comfortable in the southern market?

Matrimony.com Ltd, Q 1FY 19 Earnings Call Aug 13.2018

Management:	[ think Rohan you already answered. So whatever you said was absolutely right. 1ftsouth we don'thave to challenge even the competitiveadvertisementand all, because of the networkeffi::t:1we have alarge number of profiles. It does not have any impact on the southern market and 10a large extent inthe eastern market as well. So as you rightly said in the north and west while we don't have strongreachor in terms of the profile where we are not too significantlydifferent in terms of size and even onother aspects.there marketingdefinitelyhas an impacton the customersigning up with·ourservices. Ifthe competitors can drop the money, the customers prefer to sign up with the competitors. As yourightly said in the north if we don't advertise, we may lose on profiles and it may have an impact onthe conversionin that marketactually.So it is importantto match competitionor spendmorecomparedto even competitionin those marketsto gain marketshare.
Rohan Advant:	Okay. Sir and regarding the subsidiary in Dubai I believe we had a business in the Middle East a fewyears back which we had [ think shut down. So what is the different strategy this time? And you cancorrect me if I am wrong on this sir.
Management:	Previousto IPO, the structurewas actually different.In Dubai it is a partnership firm so we had to shutdownthe partnershipfirm.Now we are establishingour 100%owned subsidiarywhich isthe differenceactually.
Rohan Advant:	Okay. And sir the last question was regarding if you could share the cash balance on our books andwould you consider a buy back based on where the share price isright now.
Management:	Shares as you see it is around 170 crores plus in the various fixed deposits and liquid fundsthat wehave, which we are currently depositing. Yes the buyback can happen. Only thing is wejust came outwith the public issue. We are wanting to invest in the brand and look at all the options available onhand and the board will review the whole situation on year on year and take an appropriatecall.
Rohan Advant:	Okay thanks for taking my questions and best of luck for the future.

Matrimony.com Ltd, Q I FY 19 Earnings Call Aug 13,2018

Management:	Thank you.
Moderator:	Thank you. We have a question from Mr. PrajwalGote from B&KSecurities. Please go ahead sir.
Prajwal Gote:	Hisir, thanksfor the followup question.Just wantedto understandon the marriage servicesfront whatare the number of events you have conductedthis quarterin the photographybusiness?Canyou pleaseshare that?
Management:	It is close to 1000or maybe lessthan that. I don't knowthe exact number.
Prajwal Gote:	1000.And what would be the number for you to breakeven?
Management:	Again we believe that probablythe number gets close to double of what it istoday.
Prajwal Gote:	Okay understood sir. And sirjust wanted to understandon the match making services also sir, as yousaid that you are trying to increase your scale in the northernmarket. So is it fair to assume that yourATV will be affected in the near term? And if that isso, what would be that number sir? 5-10% fromthis level is it fair to assume?
Management:	No, as I said majority of the revenue for us is fromsouth and the eastern market put together.North andwest constitute only a certain percent of revenue.Even if you have to counterto competition in termsof discounts and other things, again which we have not concluded yet, that can have some impactpossibly on the ATV in the north and the western market.Whether how much of that will have impacton the overall ATV - probablymay not be much or may have slight impact.So what we are looking at- more than these things, we have to increase the marketing spends so that we can retain the market

Matrimony.com Ltd, Q 1FY 19 Earnings Calf Aug U, 2018

share and also grow market share in the long term. So, again as I said it is only last few quarters ofthe increased heightened competition what we are seeing in the north and western market: Wc have to wait and see whether that intensity is going to continue. Then we need to respond to it. So- if the intensity comes down there may be a reduction if!the marketing spends. That can increase our EBfT[!)A;margin. So it all depends on how the competition is going to conduct in the quarters to come. As I said we are spending a high discount amount compared to the revenue. So it is important as a leader with 60% market share, to definitely fight to improve ow market share which we need to do as the right thing for business in the long run. As I said in the matchmaking business we are still in-the early stage considering to the opportunity in front of us. Considering being a dominant player at an overall level, investing big in marketing is a good thing for the long run of the business. We will get the benefits of the increasing market share in the longer run.

Prajwal Gote: Okay thank you sir that is all from my side ..

Moderator: Thank you. We have a question from Mr. Gautam Dhon from Investor Financials. Please go ahead sir.

Gautam Dhon: Thank you for taking my question. Ijust wanted to understand that you have close to 4300 employees. So what is the breakup of employees by function and where are the bulk of these employees actually utilized?

Management: Majority of the people are for matchmaking; around 3800-3900 people are part of matchmaking and most of the people are in the call centre. We probably have close to 1800 or 1900 people for the call centers. So that is where the bulk of our associates are deployed.

Gautam Dhon: So going forward as the business grows would - are the rest in technology?

Management: No we have retail outlets across - 140 outlets. Then we have collections. We have around 200 plus people for collections. Then we have customer support. Then we have relationship managers for

Matrimony.corn Ltd, Q I FY 19 Earnings Call Aug 13,2018

assisted matchmaking, elite matchmaking. There are a few hundred people who are part of the technology team.

Gautam Dhon: Okay few hundred. So as the business grows the actual growth would be more at the call centre in terms of head count.

Management: More or less if you look at the matchmaking business there is not substantial increase or limited increase happened in terms of head count in the last so many years because we are continuously looking at how to use tools and technologies to maximize the conversions. So we are continuously looking at rather than increasing manpower, we are looking at using technologies to increase the conversion. So whether invest big in the campaign management tools or whether invest big in analytical or whether in AI. We continue to invest big in these technologies and tools to maximize the conversion rather than increase the manpower. One area where the manpower can go up is - if there is an increase in assisted and elite matchmaking business, then there will be a corresponding increase in the number of relationship managers to take care of the increased number of people subscribing for these services. So other than that there won't be much increase in the people count.

Gautam Dhon: Okay. And one more question was in your presentation you talked about network effect and that you have network effect in the southern state. So now in the call you said the country follows more along vernacular lines. So instead of looking at a western market or a northern market, would looking at each state give you better leverage and reaching that inflection point where the business is most of the market share is with you?

Management: Yes, you are absolutely right. Looking at particular states say Tamil Matrimony or Telugu Matrimony, many of the large number of profiles were part of the particular site. Probably that is a network effect so we are able to convert better. We are able to monetize better. So we are by and large insulated from competitors in those segments. So the way Bharat Matrimony has been structured is they have landed the speaker be it Marathi Matrimony, be it Punjabi Matrimony. So most of the market we have a good leadership except in the market which Italked about north and west where in the long run we need to fight to get the market share. Once we reach certain market share inflection point, as Isaid, we get the benefit of increased conversion and increased ATV. Even if we look at it otherwise, if we had to exclude north and west, our EBITDA margin in matchmaking will be much higher than the consolidated level of33%.

Matrimony.com Ltd, Q 1FY 19 Earnings Call Aug 13.2018

Gautam Dhon: Okay. okay. So some of these markets would actually be pulling it down. Management: Absolutely.If you look at the market EBITDAmargins, normally if we take only those markets where we are doing very well, EBITDA margins will be substantiallyvery high. It is about taking the scale and size. and then the benefits of those being a leaderto a certain level. Those benefits will move into the bottom line. Again it helps in many ways, be it the brand becomesso strong. the network effect, the conversion,ATV, you get all those benefits.But also the marginson those things arc substantially very high. As I said if we exclude some ofthe markets,the EBITDAmargin for matchmakingwill be much, much more than even 33%. If you look at our spending, good amount or money on marketing actually. Gautam Dhon: Okay thank you. Moderator: Thank you. We have a question from Mr. Sahil Shah from Ocean Dial. Please go ahead. SahiI Shah: Hi. Ijust wanted to know what are you looking in terms of revenue for FY19now. From first quarter any sort of growth expectationthat you have for FYI9 and on margins? Management: We are looking at double digit growth for the entire year. And in terms of EBITDA margin it all dependson - again if we were to increaseour marketing spendthat can have an impacton the EBITDA margin.So lookslike the competitionremains,the marketingspendscontinue,we have no other option. It is important to increase the marketing spends. If we have to increase the marketing spends in the quartersto come that will have a few percent impact on the EBITDAmargin. So it all depends on how the quarter is going to span out. So (52:05) and all is big at this point of time. Sahil Shah: But in terms of marketingyou did around 18%of your sales in first quarterright?

Matrimony.com Ltd, QIFYI9 Earnings Call Aug 13,2018

Management:	In marketingwe are talking about not what it has been this quarter.Looking at the particular markets
	like north, we are not spendingin proportionto what competitionisspending. In fact we are spending
	much less compared to the competitors' marketing spends. So if we have to increase our marketing
	spends, which we need to in case the intensitycontinues.then that will indicate increase in marketing
	cost. If marketing cost moves up definitelythere will be an impact on the EBITDA margin and the
	match making. That will have a cascadingetTecton the enterprise EBITDAmargin. 23% is what we
	had in Q3, we can probably go down by fewpercentagepoints also. So again it depends on how much
	marketingspend wewantto increase.Againthat dependson howthe competitorsare goingto continue
	their marketingspends.So what is importantisto increasethe marketingspendsin the north and west
	to defend or to grow marketshare in the long run.
Moderator:	Thank you sir. Since there are no further questions.I had over the floorto Mr. Murugavel
	Janakiraman for closing comments.Overto you sir.
Murugavel Janakiraman:	Thank you everyone for being on the call and thanksso much. Have a nice evening.
Moderator:	Ladies and gentlementhis concludesyour conference for today. Thank you for your participation and
	for using iJunxion conference service. You may please disconnect your lines now and have a great
	evening.

(This document has been edited for readability)

Matrimony.com Ltd, Q 1FY 19 Earnings CaU Aug IJ, Z"618

For further information, please contact:

Vijayanand S Company Secretary Matrimony.com Ltd. No: 94, TVH Beliciaa Towers, Tower 2, 10th Floor, MRC Nagar, Mandaveli, Chennai- 600028, Tamil Nadu, India. Phone: 044-24631500 Email: investors@.matrimony.com CIN:U63090TN2001PLC047432

ForMatrimo,~~~ Limited c~~ecretary