A Naspers group backed online marketplace for pre-owned goods seller OLX has said that “The company will start focussing on monetizing its business in India with a ten-fold growth.”
In an interview with PTI, Sushil Kumar, OLX India head, said: “Currently our focus is to grow our business in India by at least ten times and after that to think about monetization from it.”
“If we can deliver the value to our investors then the money will come as a byproduct and putting the cap on monetization will limit our long-term ambition,” he added.
Talking with the PTI, Kumar said that “The company reached break-even in the financial year of 2018 with the profit after tax of around Rs 15 crore, while OLX is currently in the investment mode and not focusing on profits.”
While speaking more on investments, Kumar told PTI that “Our philosophy at OLX is to look at the opportunity and to make investments accordingly and not to focus on obtaining any positive cash flow or profit as it will limit our ambition to grow.”
“OLX’s primarily focus on doubling its car sales business by next year, which we currently see an increase of two-fold in monthly active users from 5 crores to 10 crores and to increase jobs segments too,” he said.
Adding to this, Kumar said “Honestly speaking to you, today we don’t know how we are going to play in this vertical and how we will capture it. However, as you know, OLX is getting good traffic, and our subsidiary Aasaanjobs have the experience to find jobs for job seekers. Which is very vertical as being a heavily promoted today.”
“OLX plan is first to build its strength to cater to job segment and might look at upskilling the aspirants in the blue collar jobs category and to continue to focus on the sales of pre-owned goods at the same time and on doubling its business in the category where it starts getting the tractions,” he added.
Speaking about the sales percentage, Kumar to PTI that We are number one in used car sales with 80 percent market share. We can leverage it further. Our strength is ‘used goods’; we will continue to focus on that. Roughly, 7 percent of Indians own car and around 30 percent of people own bikes. Size of bike vertical on Olx is similar to car vertical. So, we see tremendous opportunity in these segments which we want to explore,” Kumar said.
There is a vast ecosystem of mobile phones also developing with penetration of smartphones, the Olx country head said.
“Smartphone penetration is increasing with Average phone life has reduced from 12 months earlier to six months which means more and more smartphones are coming into the market,” he said.
Adding to it, he said “I don’t remember the number correctly but we are selling around two crores (yearly listing on Olx) used phones annually, while in market eight crore used phones are sold annually. There is an opportunity for four times of growth for us.”
On any plans to enter the refurbished segment, Kumar said the company does not see the good margin in the sale of those devices.