123Greetings Revenues Shoot Up 58% YoY, Buoyed By E-com Biz

Intrasoft Technologies Ltd, which runs the e-greeting site 123greetings.com and is one of two BSE listed Internet firms in India (the other is Naukri.com owner Info Edge India) reported 58 per cent rise in consolidated income to Rs 23.92 crore for the quarter ended December 31, 2011 over the year ago period. Sequentially revenues rose 80 per cent compared to the second quarter ended September 30, 2011.

123Greetings has a core electronic greeting card business, a value-added service called 123Greetings Connect and a studio for artists. It also runs 123Greetings Invites and a Facebook app for inviting friends over for a party. But the company is slowly evolving into an e-commerce site, selling perfumes, skin care products, home appliances(including air conditioners!) and even bicycles through the website.

A breakdown of revenue and segment profits of the different businesses was not immediately available but as a consolidated firm its net profit inched up 1.5 per cent to of Rs 3.9 crore for the quarter ended December 2011 over the same period the previous year. Net profit rose 31.7 per cent compared to the quarter ended September 2011.

A majority of the website's traffic and revenue is generated between October and April.

Arvind Kajaria, managing director of Intrasoft said, "Sustained growth in our Ecommerce business coupled with increasing acceptability of our special features 'Studio' and 'Connect' in the greetings business contributed to the buoyancy in revenues."

"We continued to increase investments in the E-commerce business through automation and increasing the team size. While, this has kept the margins under pressure, we are confident of reporting higher revenues and profits in the subsequent quarters," he added.

Profitability was affected due to sharp rise in product & content development costs besides sales and marketing expenses over the same quarter in 2010.

Intrasoft's consolidated income includes revenues from all three subsidiaries – 123Greetings.com Inc. (USA), 123Greetings Singapore Pte Ltd and One Two Three Greetings India Pvt Ltd.

The Kolkata-based e-greetings company is backed by venture capital firm Intel Capital and had raised Rs 53.65 crore in an IPO during 2010. The balanced unutilised fund from the proceeds, which stood at Rs 30.2 crore as of September 30, 2011, stands at Rs 19.91 crore as of December 31, 2011.

While consolidated revenues rose sharply during last quarter, standalone results was less impressive. Standalone revenues declined 22.4 per cent compared to the quarter ended December 31, 2010 while net profit was almost flat at Rs 3.87 crore compared to Rs 3.83 crore in Q3 FY'11.

Highlights:

• 123Greetings store, the online gifting ecommerce business, shipped 57,042 orders as compared t0 24,931 orders in the previous quarter, averaging 634 order /day from 161 active vendors.
• 123Greetings Connect, which allows users to import and store unlimited contacts from their mail boxes and access their personal address book and set their contacts, birthdays from anywhere  now has registered user base of 1.62 million(December 31, 2011) compared to 1.43 million users at the end of September 2011.
• 123Greetings Studio saw 15 per cent rise in user base during the quarter ended December 2011 to 13,961.
• The core business of 123Greetings witnessed addition of 1,408 cards during the quarter.
• The firm also introduced 'Send To Facebook' feature to help users send greetings to Facebook friends.
• 123Greetings' Facebook app ended the quarter with over 1 million registered users. As many as 1.9 million cards were sent by 2,11,985 users during the quarter.