AURUMNSEQ1 FY24July 25, 2023

Aurum PropTech Limited

8,268words

113turns

11analyst exchanges

0executives

Key numbers — 40 extracted

rs,

years today as I participate in this ninth quarterly call of Aurum PropTech. Over the past two years, we have been committed to bringing technology to the real estate sector, giving rise to what is no

INR 100 crore

growth. We are proud to announce that HelloWorld, our co-living business, has touched an ARR of INR 100 crores, as compared to INR 38 crores one year ago. Further, we are also seeing great traction with Auru

INR 38 crore

nce that HelloWorld, our co-living business, has touched an ARR of INR 100 crores, as compared to INR 38 crores one year ago. Further, we are also seeing great traction with Aurum Analytica. I would now like

INR 2.7 crore

mlined the team, reducing its size from 350 to 195, and reducing the monthly salary expenses from INR 2.7 crores to INR 1.3 crores. We aim to transition NestAway to become a lean and flat organization, similar

INR 1.3 crore

educing its size from 350 to 195, and reducing the monthly salary expenses from INR 2.7 crores to INR 1.3 crores. We aim to transition NestAway to become a lean and flat organization, similar to our other Auru

INR 400 crore

24. First, we will achieve INR 100 crores of quarterly revenue, which will make Aurum PropTech an INR 400 crores run rate company. I repeat, a INR 400 crores run rate company. Second, we will restructure and m

2,000 crore

ntegrated ecosystem now collectively boasts of 13 plus products and services, 80,000 home buyers, 2,000 crores plus GTV, 520 SaaS customers, 4,400 RaaS customers, 7,500 channel partners, 600 plus real estate

INR 83.3 crore

timization and efficiency drives. Some of the key highlights include HelloWorld grew to an ARR of INR 83.3 crores with 11,195 live beds and 29 new properties it on-boarded in Q1 2023. There was a 19% growth in

19%

INR 83.3 crores with 11,195 live beds and 29 new properties it on-boarded in Q1 2023. There was a 19% growth in quarter-on-quarter revenue numbers, while occupancy stood at 74%. BeyondWalls stood at

74%

Q1 2023. There was a 19% growth in quarter-on-quarter revenue numbers, while occupancy stood at 74%. BeyondWalls stood at an INR 49.93 crores revenue. Sell.do became the 4th top ranked real estate

INR 49.93 crore

owth in quarter-on-quarter revenue numbers, while occupancy stood at 74%. BeyondWalls stood at an INR 49.93 crores revenue. Sell.do became the 4th top ranked real estate CRM globally and 7th ranked in the easies

INR 24 crore

siest to use category. Aurum Analytica serviced 116 projects and achieved an RRR of INR 24 crores per annum. Through its analytics platform, it identified 33,756 prospective residential buyers a

Guidance — 20 items

Ashish Deora

opening

“We aim to transition NestAway to become a lean and flat organization, similar to our other Aurum businesses.”

Ashish Deora

opening

“First, we will achieve INR 100 crores of quarterly revenue, which will make Aurum PropTech an INR 400 crores run rate company.”

Ashish Deora

opening

“Third, needless to mention that, we will be EBITDA positive.”

Onkar Shetye

opening

“Our target market is co-working spaces, offices, and tech parks.”

Jitendra Jagadev

opening

“This trend indicates that our target market share will increase along with the size of the market itself.”

Jitendra Jagadev

opening

“We aim to simplify our customer offerings, ensure scalability and sustainability.”

Jitendra Jagadev

opening

“Additionally, we aim to improve efficiency in performance marketing by leveraging low customer acquisition cost (CAC) channels and discontinuing high CAC channels.”

Kunal Karan

“The fixed cost for a quarter will be around INR 5.5 crores.”

Hiren Ladva

“For Q2, again we will come back with a forecast and the overall number, not just for Q2, but the entire year as such.”

Hiren Ladva

“And based on that, we can do a projection.”

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Risks & concerns — 3 flagged

Aurum WiseX is a digital distribution vertical for real estate investments, which leverages technology to offer risk-adjusted, institutional-grade investment products.

— Onkar Shetye

So, at this stage with this INR100 crores of the projection, it will be difficult for us to share anything more.

— Ashish Deora

At the moment, it's difficult to say yes or no to that, but yes, we keep on actively meeting exciting founders, who can help us build the ecosystem but as soon as we have an exciting prospect to add on to our portfolio definitely, we'll come back to the market with relevant information on that.

— Hiren Ladva

Q&A — 11 exchanges

Sir, congratulations on a good set of numbers. Can you just refer to page 18 of your slide where it says that HelloWorld is now at a revenue of around INR 21 crores, but then, there is a note saying that these businesses were not consolidated under Aurum PropTech. So, does this mean that, this has not been included in the revenue of Aurum PropTech?

Hiren Ladva

This is Hiren here. Let me just take that question. And thank you Faisal for your query and interest in our company. Regarding your question, if I refer to that chart, the Y-o-Y percentage is where we are referring to the consolidation part, right? Just to clarify, HelloWorld, we started consolidating from 15th of June of 2022. So, if I were to compare Q1 of last year versus Q1 of this year, this is where, we are trying to clarify that, the Y-o-Y comparison is only at the consolidated level. So, this year, it has been consolidated? Yes, this quarter, in fact, 15 June last year itself onwards,

Hello. Good evening, sir. And thank you so much for taking my question. So sir, we've had an ambitious target of getting to nearly INR 100 crores revenue by quarter 4. So I had two questions regarding that, like what part will drive it the most and what kind of profitability do we expect, if not this year, maybe next year, we'll be breaking even, not on EBITDA level, but on PAT level? So those are my two of my questions. Thank you.

Ashish Deora

Hello. This is Ashish here. So INR100 crores is a bold, ambitious target that we have set up for ourselves in the next three quarters. I go back to quarter one of last year, when our revenue was INR 14 crores odd, and we had set up a target of INR 50 crores for ourselves. And now with a revenue of around INR 50 crores, we have set up a target of INR 100 crores with the same confidence that we have delivered the earlier numbers. We believe that most of the businesses are in the process of delivering exceptional numbers. Most of the businesses, most of the products are looking at delivering 2x o

Yes, thanks a lot for the opportunity, sir. Firstly, congratulations on this transaction on NestAway.

Management

Hello, is it any better?

Management

My question was regarding the NestAway business. We have shared some plan in terms of, how we plan to bring down cost and all, but just to understand, since we have aspiration to grow this business in FY ‘25, how you see this shaping up and do you see this as a much larger piece of the business, which can be scaled versus some of the other transaction that we have done in the past. So how you align this reduction in cost and eventual growth given the opportunity size is much larger in this space?

Ashish Deora

Rahul, this is Ashish here. NestAway definitely has one of the largest potential of all the businesses that we own and all the products that we run. We believe that, it is set up at a very interesting juncture, where first we are reducing the operations, streamlining the operations, changing the culture of the organization. And then once, we are confident that we have the unit economics in place, we are going to grow, put it back in a hyper growth mode, which the company has the capacity to get back to. For some specific details, Jitendra, would you want to add a few things to the question of

Thank you, sir, for the opportunity. I'm new to the company, so please pardon me if my questions are a little basic. I wanted to know from a two year horizon or something, because we have a list of businesses, the top two, three businesses, which probably will contribute 60%, 70% of our revenue. If you can walk us through, what is the revenue model or the revenue recognition model and return metrics for each of these businesses would be quite helpful to understand the business?

Hiren Ladva

This is Hiren here again, Gaurav. Thank you so much for the interest in our businesses. If I go on explaining the entire business model, it will take a lot of time, but in brief, I'll try to do the justice as much as possible. At the moment, HelloWorld has been the highest contributor of our business, very simply put. It's a shared living, co-living business. Incidentally, Jitendra has been a co-founder of that business. He's running the business along with Ismail, and very successfully so. As Mr. Deora mentioned, from a INR 38 crores ARR that we had last year, we are now at INR 100 crores. Th

Hi, good evening and congratulations on the results. Just expanding on the last question as well, I basically wanted to understand, what the unit economics look like today and what they would look like at a profitable scale, especially in your services verticals, so SaaS, RaaS?

Hiren Ladva

Okay, so on SaaS point of view, we have, as I said, two products. One of them is already profitable, has got a double-digit profitability, not just at EBITDA level, but at PBT level. The other product is a fairly younger product in terms of its age in the market. There, we are focusing on growth and expansion at the moment. So, that is still where the tech costs are pretty high. We expect this business to turn EBITDA positive over the next four quarters to five quarters. So that's the two SaaS products. In terms of RaaS, as we mentioned, one of the businesses already profitable at PBT level, c

Hi, sir. Thank you for this opportunity. I'm sorry, I might be repeating this question because I joined a bit late. So, we have seen rapid growth over the last one year in terms of our top line. So, what is your outlook for FY ’24, in terms of top line and bottom line? And how do you see us, in the next two years, three years? And when do you expect us to turn PAT positive? That's all, I would like to understand.

Hiren Ladva

Yes Gunit, Hiren here. The question has already been asked and answered, so since we are short on time, I'll quickly revise that. So, we have announced that, we are aiming for a INR100 crores quarterly revenue by Q4 of FY 24. EBITDA level, we are already positive on profitability. We don't have a specific number that we can give, but internally, we are targeting over next quarters, we should be PBT positive, six quarters. All right, thanks a lot.

Good evening. My question was, with growth in the sector, do we see any growth in competition? As currently, we do not see any competition near the PropTech ecosystem, we are building because no other brand or company is building a proper ecosystem. There are individual companies. But do we see any major competition in what we are doing, so that the market share isn't divided?

Hiren Ladva

Yes, Devang, Hiren here again. As you rightly pointed out, there is no like-to-like ecosystem in the PropTech sector being developed by anybody of the scale or the vision that we are having. We are happy if somebody will also take up the mandate because then the network effect will help us, our growth as well. But at the moment, yes, no specific like-to-like comparison. Yes, there are individual companies that we can relate to as competition, where we see not just kind of exciting interest from a market creation and market growth point of view and that's where the rental business excites us a

Sir, is there any thought within the organization to make a unified app, which would incorporate all the services that we are giving within so many subsidiaries, something like how Tata Neu has done?

Hiren Ladva

So Mr. Faisal, that's a very active topic also in terms of a unified app or a master app. Various things you would kind of encounter for such a solution. Yes, they have been predominantly in India, except China, in most of the geographies, the super apps have not done so well. But to make them really do well, one, the entire ecosystem benefits to a relatively homogeneous set of users need to be created. So, when we see that happening, we will definitely aim to build such kind of an app. But when yes, if we focus on, let's say B2C as a customer, there yes, we are actually working on creating on

Thanks, Dorwin. Thank you, everyone, who participated today, we witnessed the highest participation today over the past quarters. We truly appreciate your continued interest in Aurum PropTech and we look forward to having you all in the next call again. Have a good evening ahead.

Management

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Speaking time

Hiren Ladva

Faisal Hawa

Moderator

Gaurav Somani

Kunal Karan

Rahul Jain

Onkar Shetye

Jitendra Jagadev

Ashish Deora

Darshil Jhaveri

Opening remarks

Vanessa Fernandes

Thank you, Dorwin. Good evening, everyone, and a warm welcome to the Q1 FY2024 Earnings Conference Call of Aurum PropTech Limited. Joining us on the call today, we have Mr. Ashish Deora, the Founder and CEO of Aurum Ventures, Mr. Onkar Shetye, Executive Director, Aurum PropTech, Mr. Kunal Karan, CFO, Aurum PropTech, Mr. Hiren Ladva, EVP Investments, Aurum PropTech and Mr. Jitendra Jagadev, Founder and CEO of NestAway. Today, we shall go through our performance for the quarter gone by, our future outlook and a special segment on NestAway Technologies, the latest acquisition in our portfolio. Before we dive into the details, I would like to remind everyone that the forward-looking statements we may discuss are subject to risks and uncertainties that are detailed in our prospectus and the annual report. We encourage you to review these documents which are available on our website to fully understand the risks associated with any future projections or statements. We shall now start the cal

Ashish Deora

Thank you, Vanessa. Good evening, everyone. The first quarterly earnings call under Aurum Management was hosted in July, 2021. It is two years today as I participate in this ninth quarterly call of Aurum PropTech. Over the past two years, we have been committed to bringing technology to the real estate sector, giving rise to what is now widely recognized as the PropTech ecosystem. Our team's unwavering belief and focused execution has led us to exponential and consistent growth. At Aurum, we have always emphasized EBITDA as a key metric, ensuring that our growth is accompanied by profitability. We maintain a constant focus on unit economics and as a result, we are EBITDA positive for the third straight quarter. With a sharp focus on execution and unit economics, our teams are driving each product and each business towards hyper revenue growth. We are proud to announce that HelloWorld, our co-living business, has touched an ARR of INR 100 crores, as compared to INR 38 crores one year ag

Onkar Shetye

Thank you, Mr. Deora. Good afternoon, all. The Aurum PropTech ecosystem is structured under technology, primarily encompassing enterprise tech, services, encompassing consumer tech, and capital focusing on fintech applications for real estate matrixed across the real estate value chain of development, monetization, and consumption. I would like to inform you that Aurum PropTech’s integrated ecosystem now collectively boasts of 13 plus products and services, 80,000 home buyers, 2,000 crores plus GTV, 520 SaaS customers, 4,400 RaaS customers, 7,500 channel partners, 600 plus real estate developer relationships, and a presence in 17 cities. During Q1 FY ‘24, Aurum's business focused on improving unit economics through cost optimization and efficiency drives. Some of the key highlights include HelloWorld grew to an ARR of INR 83.3 crores with 11,195 live beds and 29 new properties it on-boarded in Q1 2023. There was a 19% growth in quarter-on-quarter revenue numbers, while occupancy stood

Jitendra Jagadev

Thank you, Onkar. Good evening, everyone. The rental market in India is a significant and lucrative sector, with approximately 2.2 crore renters in the top 20 cities. Rent expenses typically account for around 30% of a renter's wallet share, making it a substantial portion of their expenditure. At NestAway, we recognize the immense potential of this consumer market. In the next two quarters, our focus is on implementing initiatives to reduce costs and drive profitability. We are well positioned to capitalize on the tailwind effect as rental rates have experienced a substantial 25% jump across major cities due to factors such as increased interest rates and the surge in demand post the work-from-home era. Additionally, buying a home has become more challenging for the younger generation due to lifestyle preferences, saving habits, diminishing emotional attachment to property, and rising housing inflation. This trend indicates that our target market share will increase along with the siz

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