Macroeconomic understanding and strategic expansion crucial to prevent massive layoffs, says Mr. Dinesh Gulati

CXOToday has engaged in an exclusive interview with COO of IndiaMART, Mr.Dinesh Gulati.

What made IndiaMART adopt a weekly pay policy? Besides, after IndiaMART, no other company has followed in its footsteps. Why are companies skeptical about weekly pay policy according to you?

As the pandemic pushed many organizations to ensure flexible work culture such as a hybrid working model, we observed that the new generation’s mindset also has been changing. The earlier generation learned to save their salaries for future expenses such as building a house or buying a car. But the new generation workforce focuses on experience more than society’s stature. They want to travel around the world, savour new delicacies, buy gadgets, clothes, and many more such activities frequently. The consumers buying pattern has also changed due to the significant rise of e-commerce and quick commerce.

Therefore, the consistent flow of money is essential to their well-being. With the consistency of weekly paychecks, they can budget for recurring expenses as they come up and have sufficient finances available for whatever they might need, whenever they might need it. Not to mention how the excitement of the payday increases fourfold with the weekly payout, making employees more satisfied, happier, and, consequently, more motivated towards their purpose in the organization.

We, in India are the first ones to  adopt weekly salaries but there are many countries across the globe like the USA, Australia , NZ and few in Europe that have weekly salaries for many years now.  We have been running weekly incentives for entire sales and service team for more than a decade and it has been very well received by all the team members. We are sure that in the times to come, more companies would find its effectiveness and adopt frequent payout of salaries.

Does the company have a consistent policy for when employees receive their weekly paychecks?

Of course! On every 8th day of a month, the basic salary gets credited, for the week. The same process is followed for the first 3 weeks of a month. In the last week, the perks, incentives, and other flexible payments are credited along with the basic salary for that week.  

It is imperative that with funding flowing in, start-ups would hire to expand. But as soon as the cash dries up, we get to see massive layoffs. What kind of workforce expansion strategy could a company adopt to avoid such adverse outcomes?

Well, first of all, drying up of cash and layoffs, both are very unfortunate; for the Businesses and the employees.

Yes, you are right, in order to expand operations, you need manpower. We have also been expanding our operation and workforce over the past few years. But fortunately, we never got into a situation where we were required to lay off people. My belief is, if you expand the workforce in a strategic manner, you may not face these times. It is important for startups to understand the macroeconomic situation, and make well-informed and long-term decisions.

In case the company is in expansion mode, it can decide to outsource some non-critical processes to its vendors and partners and own only the core activities which its own employees can handle.

Then, as their operations expand gradually, they need to keep evolving their organization’s structure in terms of temporary employees, permanent employees, and outsourced employees.

Last few years, we have seen the evolution of Gig economy as well. For companies that are at a nascent stage, gig workers or freelancers are a brilliant option. You get an array of multitalented individuals, that too at completely variable pay thus a win-win for everyone.

How can startups communicate effectively with their employees and stakeholders amidst a massive layoff to maintain morale and trust?

We always believe, being true to all who are associated with you— in whichever condition you are, is the key to maintaining trust. For example, during times like demonetization and pandemic, even though we didn’t go for any layoffs, but we were completely transparent with our employees on how macroeconomic factors were affecting the demand and the business and how we all needed to stand together strongly against these times. At times, when it was required, we clearly communicated any salary revisions, temporary salary cuts, or lower average appraisal and the reasons behind it. This actually helped us to garner the trust of our employees.

During such difficult times, it makes more sense to over-communicate rather than avoid your employees, vendors, or other partners.

What are some common reasons why large corporations might initiate massive layoffs?

This is not a new phenomenon, we all have seen this many times in the past, whether it was during the recession or the dot com burst, during demonetization and now during the pandemic period.

Thankfully, India’s economy is very resilient and protected from global happenings at the moment but I believe that as the recent post-pandemic led to a surge in demand especially through online mediums. Most of the organizations assumed that it was going to be sustainable growth and hired more people to rationalize the increase in demand generation. It is important to analyze the micro as well as macro factors which are affecting the business long term before revising your organization structure. The Ukraine-Russia war led to increase in the cost of raw materials and high inflation, which led to significant shrinkage in demand which ultimately led to the optimization of the manpower at various organizations.

What impact can a massive layoff have on a corporation’s reputation and public perception, and how can companies mitigate any negative fallout?

Definitely, if there is a layoff, there is a reputation risk. It is important to see the adversities as opportunities. Along with clear communication, organizations also need to show empathy towards their employees. Understand the impact that the layoff is going to have on their lives and take necessary steps for a seamless transition. For example, they could help employees with a few months’ buffer with salaries to help them find new jobs in the meantime. They need to make conscious efforts to refer all their employees to other organizations so that they can get absorbed. Such steps definitely help them mitigate the negative fallout.

Above all, trying all other options such as internal job posting, salary revisions, cost cutting, etc. should be considered first to avoid any such situation.

How can companies ensure that their workforce is aligned with their sustainability goals and values?

In order to have a workforce that is aligned with the sustainability goals of a company, it must be communicated well, over time and should not just remain in the boardroom discussions. Involving and engaging employees in the process and providing sustainability training enables them to actively contribute. Integrating sustainability into job roles ensures that every employee understands their role in achieving the goals. Lastly, fostering collaboration among employees promotes collective efforts toward sustainability.

What impact can sustainable practices have on a company’s workforce, such as job creation or skill development?

By focusing on sustainability a company can unlock new opportunities and innovations, which may lead to job creation and requirement of skill development. Depending on the type of sustainable practices implemented, one may require different skill sets, from ESG analysts such as water management or Green Building specialists and IT professionals to marketing experts and project managers. This can promote skill development and career growth among employees, and even lead to job opportunities and skill development for the broader society.

For example, at IndiaMART, our CSR initiatives aim to create a more inclusive society by strengthening education and skill development facilities for underserved sections of the society and through these initiatives, we have been able to touch ~1.1 million lives.

Similarly, we have always focussed on inclusivity among the masses and decreasing disparities which have led to the organization spearheading in laying out an ‘Online Associate Program’. This program has particularly benefited Return to work mothers, People with Disabilities (‘PWD’) and other individuals who may not wish to do a full-time job, however, are quick to embrace specific part-time opportunities without being permanently employed. Therefore, I believe that by promoting sustainable practices, companies can positively impact their workforce and society as a whole.  

How can companies balance the need for profitability and growth with sustainable practices that may require additional investments or changes to business models?

Creating sustainable value involves acknowledging the importance of sustainability in economic growth. It is no longer just a “good to do” practice. Achieving profitability and growth while being ESG compliant is possible. At IndiaMART, we have integrated sustainability into everything that happens. We provide free online web presence to 7.3 mn suppliers and yet we have been able to consistently achieve profitability since our inception by choosing the right business model and being agile to adapt to the changing environment.

At the same time, by facilitating digital interactions, paperless operations, digitized payments and easy online access to suppliers and markets across the nation, we are able to indirectly achieve reduction in emissions by reduced transport and paper usage between suppliers and buyers.

Many of our customers employ additional manpower to manage the growth in terms of business enquiries, leads, customers, and sales that they achieve through the IndiaMART platform. This growing ecosystem results in the creation of employment opportunities at multiple levels.

If we select sustainable practices that align with our business values and goals, it can actually help increase efficiency, cost savings, access to new markets, and even better brand reputation and customer engagement. Developing a well thought-sustainable strategy can help any organization create long-term value for all stakeholders.  

Can you share an example of a successful HR initiative or program you’ve implemented, and what impact it had on the organization and its employees?

At our company, we prioritize the well-being and development of our employees at all stages of their association with us. We focus on their skill development and career progression and enable them at every stage of their journey at IndiaMART.  From the moment they join our team, we have a thoughtfully crafted process in place to ensure their success.

To further support our new joiners, we have a buddy-up program in place where each new employee is paired with a mentor who guides them through their initial settling period. It helps employees acclimate to their new job, understand their roles and responsibilities, and integrate into their team and company culture seamlessly.

We also offer a self-learning program called iLEAP, which allows employees to pursue skills and knowledge with certifications that align with their career aspirations at any stage of their time at the company. Through partnerships with prestigious national and international institutes, employees can enroll in leadership courses and programs, the cost of such interventions is borne by IndiaMART. We have more than 160 employees who have leveraged this opportunity for their skill development.

Most recently launched iLEAD program – IndiaMART’s Leadership Experience and Development Program, our flagship initiative designed to fast-track the development of our fresh employees. This program prepares them for future leadership roles and responsibilities, allowing them to further develop their skills and grow within the company. I am very elated that more than 600 employees have enrolled in this initiative for future leadership roles.

We keep exploring such program opportunities which could help them upskill themselves, make them prepared for upcoming opportunities, and grow their career further during the entire journey at IndiaMART. Leveraging our comprehensive range of initiatives and programs, a decent section of our workforce has achieved notable career advancement within the organization.

How do you collaborate with other leaders within the organization, and what strategies do you use to build strong relationships and ensure HR is aligned with broader business objectives?

At our organization, we have a well-crafted strategy for leadership that promotes transparency and collaboration among all team members. Our open-door policy has been a cornerstone of this approach, encouraging communication and cooperation at all levels of the organization.

As we continue to grow steadily, our employee base grew by 25% over the past year. Therefore, we have implemented various initiatives to bring cross-functional teams together. For instance, at the beginning of each financial year, we conduct AOPs, where we reflect on the previous year’s performance and align our goals for the new financial year with our teams. This fosters synchronization and interaction between team members and leaders across the business.

We also organize Business Meets, monthly/quarterly programs that keep all stakeholders abreast of our current achievements, areas that need immediate attention, and strategies to achieve our targets. Additionally, we hold Product Meets, Testers Meets, and Learning Sessions between technology and business teams and the leaders to educate individuals on new developments, improvements, and emerging trends. We have also partnered with several institutes for our employees who can enroll themselves for professional programs and enhance their skill and competency.

For senior leaders in the organization, we encourage them to participate in various industry meets so that they can engage with other industry leaders to exchange information and to empower them to stay at the forefront of their industry, foster professional growth, and contribute to the success of their organization.

To increase engagement among team members, we invite leaders to felicitate employees for their contributions and celebrate their accomplishments. For instance, we host Long Service Awards to recognize those who have been instrumental in building IndiaMART over the years. Our Annual Awards are also highly coveted, honoring team members for their outstanding and consistent contributions. Even just being nominated for these awards is a matter of pride.

Finally, these award events and fun-filled activities promote camaraderie and a sense of community within our organization and better connection with the vision of the leaders of the organization.

We plan to add upwards of 8,000 new subscribers every quarter, says Dinesh Agarwal, Chief Executive Officer, IndiaMART

“Currently, we have 170 million registered buyers, 7.5 million registered suppliers, and 95 million products live on our platform. They have been growing at a CAGR of 15-20 per cent year on year. We plan to maintain a similar growth rate for the next couple of years,” he said.

IndiaMart recently reported a consolidated net profit of Rs 56 crore for the fourth quarter ended March, down marginally from Rs 57 crore in the year-ago period. Its revenue from operations jumped 34 percent to Rs 268 crore for the reporting period. It was Rs 201 crore in the corresponding period for the last year. Dinesh Agarwal, Chief Executive Officer, IndiaMart discussed the financial results with ETRetail.

Another important aspect for this particular year was to make sure that post acquiring Busy Infotech, we are able to transition from the older management to the newer management as well as induct people in order to improve sales in the areas unrepresented there. In the last 18 months, we have been able to increase our customer base.

In fact, during a lot of cost-cutting wherever possible because there was too much uncertainty in the market and while our collections were lower, our revenue flows from the previous year, it looked like the profits were very high. But if you look at the collection-to-cash flow ratio, it had actually come down and if you look at the cash flow metrics, we have actually done better year after year.

In FY21, we did hardly Rs 300 crore of cash collection and in this year 2023 till now, we have experienced Rs 475 core of cash flow operations as deferred revenue flows into the revenue while the expenses immediately reflect on the P&L. That is why there were inflated profit during the FY21 and that continued for FY22 and it could not scale.

Which categories are seeing the maximum growth?

Industrial products, machinery, and planting machinery are our top categories followed by building and construction materials and related items. And the next top category is driven by e-commerce growth – packaging and printing materials. The new categories which we have started focussing upon are exports growing at a CAGR of 15-20 per cent year on year. We plan to maintain a similar growth rate for the next couple of years. Apart from this, we have been able to increase the average revenue per subscriber to almost Rs 50 thousand.

How many paid subscribers do you have currently? And what steps are you taking to increase these subscribers?

We have 2, 03,000 paid subscribers and during the last quarter, we added 8,300 new subscribers. We plan to add upwards of 8,000 new subscribers every quarter. Last year, we added about 33,000 new subscribers as against about 17,000 the previous year and as against 22,000 the year before Covid.

This year also based upon the similar run rate, we are planning to add about 32,000 customers to the paid subscriber base. towns. We have increased almost 3 percent market share in the tier 2 tier 3 towns as against metros. We will continue to expand pan India and penetrate deeper into categories. We will deploy technology in a manner that is easy for dealer distributors in tier 2 and beyond to adopt.

Where do you see the company investing to increase the market share?

We already have a good market share and we continue to invest in channels. Last year, we expanded our channel dealership program and now, we have 150 dealer distributors available in 66 different cities and towns.

We have increased almost 3 percent market share in the tier 2 tier 3 towns as against metros. We will continue to expand pan India and penetrate deeper into categories.

We will deploy technology in a manner that is easy for dealer distributors in tier 2 and beyond to adopt.

Pyramid & Precious International: Access to Export Leads

Introduction: Established its operation in  2009, “Pyramid & Precious International”, is considered one of the leading manufacturers, suppliers, exporters, and wholesalers of optimum quality Gemstones and Jewelry Products. 

Association with IndiaMART: “I worked in the gemstones industry in Thailand for 11 years, & wanted to start something of my own in India. My partner and I started an export-only business and were the only resources between 2009 and 2013. We learned about IndiaMART via an ad, & decided to try it. Slowly we realized it’s a great way to reach your potential customers.”, says Nandan Singh Nayal

He added, “It’s been a great journey, as we started with a package of 20,000 and now we are spending 12 lac on IndiaMART. It clearly reflects how our business grew in these years.”

New Arts Structures Private Limited: Find your Customers online

Introduction: New Arts Structures Private Limited is a leading manufacturer and supplier of Tensile structures, Tensile membrane structures, Car parking tensile structures, Gazibo tensile structures, Tensile roofing, Tensile fabric structures, Modular tensile structures, Polycarbonate Dome, Awnings, Walkway covering structures, Retractable Tensile, Tensile umbrella & many more such products.

Association with IndiaMART: “Initially, when I started the company, we distributed pamphlets in the societies to market our products. Fortunately, in 2013, we got in touch with IndiaMART. We received a great response from the portal & we have now developed a massive chain of buyers via IndiaMART”, says the co-owner of New Arts Structures Private Limited.

IndiaMART InterMESH Limited – Full Year and Fourth Quarter ending March 31, 2023 – Results Press Release

Noida, India, April 28, 2023: IndiaMART InterMESH Limited (referred to as “IndiaMART” or the
“Company”), today announced its financial results for the full year and fourth quarter ending March 31,

Financial Highlights (Q4 FY2023):
IndiaMART reported consolidated Revenue from Operations of Rs. 269 Crore in Q4 FY23, a growth
of 33% YoY primarily driven by 20% increase in number of paying subscription suppliers and addition
of Rs. 12 Crore revenue from accounting software services. Consolidated Deferred Revenue increased
by 28% YoY to Rs. 1,162 Crore as on March 31, 2023.

The Company continued making growth investments in manpower, product and technology, sales and
servicing resulting into growth in revenue and paying subscription suppliers. As a result, consolidated
EBITDA was Rs. 66 Crore for Q4 FY23 representing EBITDA margin of 25%.

The Other Income increased to Rs. 31 crores primarily due to fair value gain on treasury investments.
Net Profit for this quarter was Rs. 56 Crore representing margin of 19%.

Consolidated Cash Flow from Operations for the quarter was at Rs. 209 Crore. Cash and Investments
balance stood at Rs. 2,335 Crore as on March 31, 2023.

Operational Highlights (Q4 FY2023):
IndiaMART registered traffic of 252 million and Unique business enquiries of 22 million in Q4 FY23.
Supplier Storefronts grew to 7.5 million, an increase of 6% YoY and paying subscription suppliers
grew to 202,690 a net addition of 8,335 subscribers during the quarter. Total headcount increased by
170 to 4,583 at the end of the quarter with focus on strengthening Sales and Servicing teams.

Commenting on the performance, Mr. Dinesh Agarwal, Chief Executive Officer, said:
“We are happy to close the financial year with a continued growth in customers, revenue and cash flows
while maintaining healthy margins in the business. We continue to invest in further strengthening our
product, technology and building strong customer relationships. This remains integral to our long-term
strategy to drive profitable growth and leverage our value proposition to create value for all our

About IndiaMART:
IndiaMART is India’s largest online B2B marketplace for business products and services. IndiaMART
makes it easier to do business by connecting buyers and sellers across product categories and
geographies in India through business enablement solutions. IndiaMART provides ease and
convenience to the buyers by offering a wide assortment of products and a responsive seller base while
offering lead generation, lead management and payment solutions to its sellers.

The Grand Finale of the Thinkers of Tomorrow, presented by Symphony

Symphony Ltd. in association with the News18 network, awarded MSMEs who are working tirelessly to foster a culture of sustainability, inclusion, and employee care at the grand finale hosted in Delhi on 20th April 2023 in the presence of Policymakers & Industry stalwarts.

Sustainability has gained significance globally in recent years, causing governments to take concrete steps to encourage MSMEs to adopt quality standards and processes.  Building on the premise of sustainability, Symphony Ltd., in association with the News18 network, has launched Thinkers of Tomorrow.  This unique initiative recognises the innovative efforts of MSMEs to adopt sustainable business practices.  The campaign received an overwhelming response, with over 2,000 entries.  Zonal winners were shortlisted from the north, south, east, and west, who then went on to compete for the grand finale, adjudged by an illustrious jury and facilitated by EY.

The finale award ceremony commenced with a welcome address by Anuj Arora, CMO, Symphony Ltd., who spoke about extreme weather conditions playing havoc on productivity and costing India 5% of its GDP.

He reported an alarming loss of nearly 160 billion potential labour hours as a result of these adverse conditions. He stressed the need to take serious cognizance of investing in ESG and its correlation to profitability.

His address was followed by a keynote by Shri B.B Swain, Secretary, Ministry of MSME, GOI, who, quoting an economic survey, shared how the GST collections from MSMEs in the current financial year are higher in comparison to the pre-pandemic years. He further stated, “As many as 14.6 lakh MSME accounts were saved from becoming NPAs during the launch of the Emergency Credit Line Guarantee Scheme”.

Mughda Kalra from the network engaged in an insightful panel discussion on Navigating the New World Order and Building a New India. Panelists comprised Vishwachetan Nadamani, COO, Ecom Express; Ashok Saigal, MD, Frontier Technologies, & Co-Chair, CII’s National MSME Council; Dinesh Gulati, COO, IndiaMART; Vinod Sharma, MD, Deki Electronics Ltd.; and Amit Kumar Group CEO & Executive Director, Symphony Limited.

Addressing the unfortunate credit gap that paralyses most MSMEs, Dinesh spoke about the lack of a formal structure among MSMEs, which prevents them from taking advantage of various government schemes and financial aid. He said, “Almost 85% of businesses are informal; they don’t have any structured balance sheets; they don’t have any structured credit payment systems; they don’t monitor how the accounts work, and that’s where they lose out”. On the other hand, commenting on the regulatory framework that challenges MSMEs, Ashok stated how the government is proactively taking steps to weed out the apprehensions amongst most MSMEs. He added that there is a 59-minute loan scheme at public sector banks; all one requires is a PAN card and GST return to avail of this service.

Busting the myth that ESG is not linked to profitability, Vishwachetan said that awareness is important, and secondly, he explained that it is easier to embed the principles of ESG in a smaller organisational setup as compared to a large organisational setup. Speaking proudly about Deki’s contribution to the energy efficiency revolution, Vinod explained how their company scaled up over the years in a zero-duty environment. He said, “Every single capacitor we sell is technically benchmarked with the best in Japan, reliably benchmarked with the best in Germany, and price-wise, it is benchmarked with the best or the cheapest in China”.

Concluding on an introspective note, Amit pointed out the gap between the decisions made in air-conditioned corporate offices and their actual translation on the field.  The discussion was followed by the award ceremony.

Money Control

Strategies to boost MSMEs growth through digitization

Over the last two decades, technology has influenced every aspect of our lives, permeating every facet of society, from healthcare and education to social relationships, and personal habits to business behaviours.

While technology has overpowered every sector and function of the world of enterprise and has led to significant innovations and opportunities, it has also resulted in a digital divide. Formal businesses have embraced technology, while the large universe of informal businesses, primarily MSMEs, have been struggling to catch up on this front.

If we look at China’s SME ecosystem, it has been clocking a 10 % growth year-on-year, resulting in the addition of ~ 5 million new businesses each year. This is because they have been early adopters of digital technology and hence played a crucial role in China’s economy, contributing over 60% to its GDP and accounting for 80% of employment opportunities in the country.

Now, let us compare this with India’s small and medium business communities. India’s MSME sector is the second largest after China, with over 64 million businesses significantly contributing to the nation’s socioeconomic growth. They even help in reducing regional disparities, assuring a fairer distribution of national income and wealth by creating employment opportunities across the nation.

For many decades, MSMEs had to face many challenges related to policy and regulatory frameworks, such as complicated taxations, licensing procedures, high compliance costs and inadequate infrastructure in Tier 2,3 cities and rural areas, which inhibited them from growing and prospering further. Both, the prohibitive cost of automation and awareness of the solution have mostly limited digital adoption among MSMEs.

But thanks to the increasing affordability of smartphones, low tariff of the internet, growing use of digital media and rising awareness of online platforms like marketplaces or e-commerce are spurring the future growth for MSMEs in India. Adding to it, the enhanced digital infrastructure through government policies like GSTN, e-way bills, MSME Udyog Aadhar, NPCI, and many more are playing a vital role in democratizing business opportunities and making it easier for MSMEs to embrace digital technology.

The need for Tech enablement

Marketplaces and digital platforms on one side do serve the basic needs of MSMEs to have access to new markets, on the other side they also create access to technology such as cloud-based applications, automation, data analytics, and business intelligence which enable MSMEs to gain an in-depth insight into market trends and consumer journeys. It facilitates faster decision-making based on up-to-date, real-time information resulting in increased sales and revenues. While many MSMEs are taking advantage of going digital for local markets, it also allows them to go international by adopting borderless marketplaces, thus boosting scalability and optimizing resources and costs. These online platforms including marketplaces, e-commerce platforms and social media comprising features such as online presence through websites, rating systems, feedback mechanisms, payment tools, conversation tools and trust certificates, build credibility in the market almost immediately thus democratizing the business opportunities for them irrespective of their demographics.

Digital proficiency clearly is the need of the hour if a business wants to survive disruptions, build resiliency, and transform itself strategically. It will be even more ubiquitous in the near future. And to maximize the benefits of online platforms, all MSMEs need to do is improve their own commitment directly or provide a dedicated resource to manage online marketing, customer interactions, platform engagement, and regulatory compliance.

Leveraging Digital Infrastructure for MSMEs’ Growth

While leveraging newer technologies helps these enterprises to take advantage of opportunities in today’s changing environment, it alone will not help them to become growth accelerators for India. MSMEs face legacy issues such as inadequate and untimely credit and lack of access to finance. This is because of the lack of sufficient collateral, and low credit score that compels them to rely on unsecured loans at higher interest rates, which dents the economic viability of their businesses, and deters them from expanding and investing in new technology. It also dampens their spirits.

Therefore, the emergence of digital financial services will not only provide viable solutions to some of the challenges hindering the growth of this heterogeneous sector but will also promote financial inclusion. India’s digital commerce ecosystem is increasingly becoming interconnected and interoperable, creating a dense stack of digital infrastructure that amplifies the value of other digital services and facilitates further innovation in the space. The Indian government initiatives such as Atmanirbhar Bharat Abhiyan, allocation of Rs 15,700 crore in the Union Budget 2022-23, and extension of the ‘One District One Product’ (ODOP) scheme to cover 7,500 new products or the Udyam Registration portal and the launch of ONDC are initiatives in the direction to create a strong digital infrastructure. Similarly, marketplaces whether it is IndiaMART or GeM, are acting as catalysts to enable MSMEs and promote this sector’s growth further.

India has improved its ranking in the World Bank’s Ease of Doing Business Index, but the Indian MSME need more at the national scale. They need a more enabling legal, regulatory, and administrative environment to prosper. E-commerce platforms and online marketplaces can serve as critical intermediaries for digital financial services, integrating payment and credit services into their interfaces and aggregating detailed data on MSMEs. By doing so, they can gain insights into the risk profiles of particular groups and develop targeted financial products that cater to their unique needs. Besides, the government must accelerate its effort to assist this segment and encourage innovation of new technologies that offer more customized digital solutions and credit enablement given the complexity of the sector.  

Today’s technology is gaining traction at an accelerated pace. The changes in the technology space is opening up a world of opportunities for these small businesses and is key to their growth and formalization. Digital transformation is no longer an option but a necessity in today’s fast-paced business landscape. With the right strategies in place, MSMEs can leverage technology to expand their market reach, increase efficiency, and tap into new revenue streams. As India sets its sights on becoming a $5 trillion economy by 2025, the role of MSMEs will be critical, and digitization will undoubtedly be a key enabler of their success.

Times Of India

IndiaMART InterMESH shares rally as co announces 1:1 bonus issue, Rs 20 per share dividend

IndiaMART InterMESH also announced its fourth quarter results today. The firm reported a consolidated net profit of Rs 56 crore for the March quarter, down marginally from Rs 57 crore in the year-ago period

Shares of IndiaMART InterMESH jumped 2.72 percent to trade at Rs 5,391.20 in Friday’s noon deals after the company announced a bonus issue of equity shares to investors in the proportion of 1:1.

“The board recommended issue of bonus shares to the equity shareholders of the company in the proportion of 1 (one) equity share of Rs 10 each fully paid up for every 1 (one) existing equity share of Rs 10 each fully paid up held as on the record date, subject to the approval of the shareholders in the ensuing AGM,” the company said in a regulatory filing.

For every one share held, the company will be giving out one bonus share issue to the eligible shareholders.

A company issues bonus shares for their shareholders in order to increase the liquidity of the stock as well as with the aim to decrease its stock price to make it affordable for investors.

Bonus shares are fully paid additional shares issued by a company to its existing shareholders. When a firm issues bonus shares, its shareholders do not have to incur any extra costs to get them. The number of bonus shares you receive depends on the number of shares of the firm you already hold.

All shareholders who own shares of the company before the ex-date, which is determined by the firm, are eligible for additional shares.

Apart from the bonus issue, IndiaMART InterMESH has announced its fourth quarter results today. The firm has reported a consolidated net profit of Rs 56 crore for the fourth quarter ended March, down marginally from Rs 57 crore in the year ago period.

The company’s revenue from operations jumped about 34 percent to Rs 268 crore for the reporting period. It was Rs 201 crore in the corresponding period of last year.

The company has also recommended a a final dividend of Rs 20per equity share of face value of Rs 10 each for fiscal FY23. The dividend will be paid within 30 days from the date of declaration and approval of final dividend by the shareholders of the company.


With the adoption of AI, we aim to cross demographic barriers: Dinesh Gulati, IndiaMART

The COO of IndiaMART shares the company’s market expansion strategies, advertising campaigns and growth plans

India’s tier 2 and tier 3 markets are evolving fast and improving their contribution to India’s economy owing to rapid mobile internet penetration, tech adoption, the reach of marketplaces & e-commerce platforms and simplification of various policies. This is effectively supporting the growth of India’s B2B sector, says Dinesh Gulati, COO, IndiaMART.

Nearly 35 per cent of the B2B traffic comes from Metros and the rest is from non-metros and smaller towns, Gulati shared in a conversation with e4m. He also spoke on the company’s market expansion strategies, advertising campaigns and growth plans.

What major investments are boosting the overall growth of the company?

We started expanding our network of acquisitions 18 to 24 months back. Earlier we used to have only an in-house sales team and then we started expanding through our channel partners in large cities as well tier 2-3 towns because of the change in traffic patterns, which is coming almost 65 per cent from tier two, three, and four towns. Our revenues are increasing because we have a steady growth in the number of customers being added.

Our net customer addition is between 8,000 -9000 per quarter. Having said that, there is a lot of work happening on the platform itself so that we can improve our experience for our buyers and suppliers.

As per recent reports, IndiaMART looks to add a credit facilitation offering on its platform to help small businesses. What is the aim behind offering credit facilities?

We were able to enhance our access to the markets by enriching our platform through enriched categories, good content and offering various other technology solutions that MSMEs need today. Besides facing other problems, SMEs are bereft of financial resources to sustain their businesses. Thanks to the technology that we have, we can monitor their behaviour. Hence, we decided we should also look at providing access to funding, finance to these businesses. We are trying to integrate a sustainable and effective solution on the IndiaMART platform to facilitate credit borrowing in simplified way.

Recently, IndiaMART has announced market expansion across India. Besides opening four new branches in Tamil Nadu, the company plans expansion across Gujarat, Maharashtra, Karnataka, and Kerala. How does the company plan to connect larger sellers to local buyers? 

With businesses adopting digitisation rapidly, buying patterns have changed explicitly. To keep pace with the GDP contribution from the South, we had to move much faster so that we would be always in sync with the South. Two to three years back we realised buyers from smaller towns were not very well-versed in English. They either use voice search or their vernacular language. We implemented these interventions on our platform and today our buyers can search through voice in nine languages and almost in 180+ languages on-line.  We have set up a dedicated  service centre in Chennai to serve our  tamil speaking TN customers at the moment, but we will expand it to service other southern state customers namely Karnataka, Kerala, AP & Telangana over next few quarters.

Clear detailing of products, their prices on the website, flexible marketing approach, strong SEO and AI-driven marketing algorithm help IndiaMART stand out in the clutter of B2B business. Also, we have been trying to make this platform as relevant for our suppliers and buyers and as functional as it needs to be, rather than throwing money on above-the-line media marketing, and channel marketing. Today we have almost 16 crore-plus buyers. We have more than 10% of India’s population registered on a B2B platform like IndiaMART and our repeat buyer traffic is almost 53%. Furthermore, with the adoption of AI, we aim to cross demographic barriers and make match-making happen across geographies and every aspect of buyer and supplier. Presently, we have almost 400 plus brands that are large enterprises and present on the IndiaMART platform, whether it is Toshiba, Carrier Aircon, Tata Motors, Tata Steel, JCB etc.

IndiaMART launched its campaign during the IPL season. How does IndiaMART plan its quarterly advertising spend? 

Our entire investment has been in creating more contenton the platform and developing innovative solutions like cloud telephony, Lead manager, Payment solutions etc. We have 74 lakh suppliers on the platform and keep enriching their catalogues. Out of these 74 lacs suppliers 37% or so also buyers on the platform thus creating strong network effect for the brand.

On branding front we do such videos, mailers, multiple Social media interventions besides participating in various industry seminars, meets. Our sales and service team connect with almost 1mn suppliers either in person or over video meets, that’s the biggest brand building for us.

Which sector does IndiaMart plan to focus on in the following fiscal year? 
We have 56 industries on our platform and we are a horizontal marketplace. Having said that, we cannot push any particular category or industry sector but keep working on multiple industries throughout the year depending in multiple factors including seasonality.  But these things keep changing. During Covid we started focusing on pharma and medical equipment categories when the entire nation was in the need of medical products, facial masks,PPE kits, concentrators and various chemicals etc.

What are the challenges for India’s B2B sector and what’s the way to tackle them?

In China, internet adoption amongst businesses is close to around 80% or so. Whereas in India we are still less than 50%. So, there is headroom for B2B businesses to improve. Having said that, in the last few years, thanks to UPI, GSTand e-way bills a lot of things have simplified businesses across all demographics. Thanks tothe credit guarantee scheme, the government of India has offered a sizable chunk of loans that are given collateral free.

There are small teething issues where we have scope to improve things. But the biggest challenge is to make finance and funding available for businesses.

I’m very bullish about the way things are going to help our B2B micro and medium enterprises to a great extent. However, headwinds are there because of various global factors. We saw raw material prices going up, and inflation going up. But despite that, we continue to grow primarily because of some ease of policies and better consumption patterns. Thanks to PLI scheme there is lot of improvement in manufacturing sector and it will continue to improve further. I’m sure we will see a lot of improvement for our B2B businesses. 


B2B Business Less About Brand, More About Functionality: IndiaMART’s Dinesh Agarwal

  • Talking about profitability of ecommerce players, IndiaMART CEO Agarwal said that irrespective of the segment in which a company operates, the objective is always to become profitable
  • Speaking at Inc42’s The Makers Summit, Agarwal also said that customer acquisition cost is higher for B2B ecommerce players
  • IndiaMART, which operates in the B2B ecommerce space, reported a 61% year-on-year increase in its consolidated net profit to INR 113 Cr in Q3 FY23

Over the past few years, B2B ecommerce has emerged as one of the fastest growing segments in the eretail segment. However, while B2C ecommerce brands often resort to aggressive marketing strategies, B2B players are conservative. Explaining this contrast, Dinesh Agarwal, CEO and founder of IndiaMART, said that the B2B ecommerce business is less about brand and more about functionality.

Besides, the B2B business is based on trust and relationships, Agarwal said at Inc42’s The Maker Summit 2023.

Talking about the profitability of ecommerce players, Agarwal said that irrespective of the segment in which a company operates, the objective is always to become profitable.

“Profitability is the mindset of a company, irrespective of the fact whether it is B2B or B2C. You will see a few companies even in the B2C segment that are building profitably, EaseMyTrip for example,” Agarwal said.

IndiaMART, which operates in the B2B ecommerce space, reported a 61% year-on-year increase in its consolidated net profit to INR 113 Cr in the December quarter of the financial year 2022-23.

Talking about the company, Agarwal said IndiaMART also has an advertising vertical.

Advertising platforms in the ecommerce space typically thrive on a premium business model, unlike the transaction platforms, he said. While a lot of B2C companies have premium business models, the value being driven by consumers is very small for them.

For B2B businesses, he said there are only two propositions – either they can provide enough value for customers to stick around or provide no value. Besides, customer acquisition cost (CAC) is also higher in the segment. Hence, B2B businesses have to eye higher average revenue per user and higher margins, he added.

Started 26 years ago by Dinesh Agarwal and Brijesh Agarwal, IndiaMART connects enterprise buyers with suppliers. It got listed on the exchanges in 2019.

Talking about the changes post the company’s IPO, the IndiaMART CEO said that as the platform has been profitable for most part of its journey, the public listing didn’t make much of a difference in the way it operates.

However, he mentioned that a public company is always measured in terms of its growth and profitability.

At $1.47 Bn, the B2B ecommerce segment raised the second highest funding among the ecommerce subsectors in 2022. Overall, Indian ecommerce startups raised $4.01 Bn of funding in 2022.