Indiamart founder CEO Dinesh Agarwal celebrating a 25% jump in value at listing says Indian e-commerce is a ‘winner takes all’ market

Business Insider

Dinesh Agarwal, founder and CEO of IndiaMart 

When IndiaMart opened its doors for an Initial Public Offering, the founder Dinesh Agarwal was apprehensive – after all, it was the first IPO after the elections with the Narendra Modi government coming back to power – and that too a tech IPO! But in two days, investors subscribed for 36 times the. But in two days, investors subscribed for 36 times the total number of shares on offer. Today, the stock has listed 25% over its issue price. 

IndiaMART InterMESH which is the parent company for Indiamart.com – one of the country’s biggest online marketplaces for businesses – is one of the country’s oldest e-commerce ventures that started in 1999. 

It competes with TradeIndia.com, Alibaba India and ExportersIndia.com. IndiaMart has over 82.7 million registered buyers and 5.55 million supplier storefronts across 54 industries in India at the end of March 2019. 

This compares to TradeIndia.com’s (founded in 1996) 4.96 million registered users today, ExportersIndia’s (founded in 1997) over 2.7 million users in India. Meanwhile, the global e-commerce giant Alibaba, which launched the India unit in 2008, has over 6 million members with 15,000 Indian SMEs on its platform. 

However, at IndiaMart competition isn’t a worry. “We are 16X the size of our next competition, our lead is only growing. It’s a winner takes it all kind of a market and is growing,” Dinesh Agarwal, founder and CEO of IndiaMart, told Business Insider. 

In an interview, Agarwal said the IPO process very overwhelming but he was sure of the prospects. “We were confident about our numbers, having built a robust business and having had great numbers since the last three years. Even while the small and medium enterprises had faced temporary setbacks like demonetization GST and then the elections, we have managed to put out our best performance,” said Agarwal. 

IndiaMart’s revenue has been growing at 29% per annum for three years. IndiaMart, which was founded in 1999, today claims to have a 60% market share of the online business classifieds space in India, and it focuses on providing a platform to Small & Medium Enterprises (SMEs), large enterprises as well as individuals. 

Will the success of Indiamart’s IPO open the doors for other too? “That’s a tall claim. I think it all depends on the readiness of the company rather than the market,” he said. 

With a listing on the stock market, IndiaMart is now open to market scrutiny. But Agarwal is rest assured. “Our business model has been proven time and again. We know how to steer through tough times and accept newer technologies. When we started we were a desktop based company, now we are a mobile B2B company, so we have seen how to evolve with time. We have seen 5 governments too through our time!,” he said. 

With the IPO proceeds in its kitty, IndiaMart plans to grow bigger. “Today we are attracting larger companies like Jindal Steel, JCB Machines, who are advertising and generating lead on our platform. We have also adapted SaaS – Software as a Service – where we have developed a CRM for SMEs to manage their leads, invoice management and more,” he said.