- The scrip has already risen 25.34 percent so far this year.
- “It is the dominant B2B classified platform in India with strong moats to defend it against the competition,” global brokerage Jefferies said in a note.
- On July 4, 2019, IndiaMart made a strong listing on the bourses at a premium of 21.27 percent at Rs 1,180 level compared to its issue price of Rs 973 per share.
hares of IndiaMART InterMESH, an online marketplace for business products and services, have rallied over 172 percent since its debut on the stock exchanges in July last year.
The scrip has already risen 25.34 percent so far this year. The company holds a market cap of Rs 7,479 crore.
On July 4, 2019, IndiaMART made a strong listing on the bourses at a premium of 21.27 percent at Rs 1,180 level compared to its issue price of Rs 973 per share.
At 2:35 pm, the shares were trading 0.32 percent lower at Rs 2,585.95 apiece on the National Stock Exchange.
“It is the dominant B2B classified platform in India with strong moats to defend it against the competition,” global brokerage Jefferies said in a note.
The company reported decent Q3FY20 earnings with revenue growth of 23 percent YoY.
EBITDA and EBIT margins also surprised positively at 26.4 percent and 22.9 percent, respectively beating analysts’ expectations by 250 bps as most of the incremental revenue flowed to the bottom-line.
Collection growth remained stable at 15 percent YoY similar to the last couple of quarters but down YoY as the weak economic environment continued to hurt.
Jefferies maintained a ‘Buy’ rating on the stock as it expected a strong 30 percent+ EPS CAGR over FY20-22E through a combination of revenue growth and margin expansion.
Paid subscriber addition remained at 4,500 in the quarter while the total base was up 15 percent YoY to 142,000 versus 124,000 in Q3FY19. Annualized revenue per paid subscriber increased 7 percent YoY to Rs 45,300.
The management of the company indicated Indian language content as a potential opportunity to increase traffic to the site or application.
The company also indicated that while it does not see much value in B2B logistics, which some transaction-based B2B sites are attempting, given its prior experience with Tolexo, it is witnessing some interesting experiments with credit, which it could look into at an opportune time.“We expect 20 percent revenue CAGR over FY20-22E despite macro headwinds related to economic slowdown; this, in turn, should drive sharp margin expansion to 28 percent by FY22E versus 16 percent in FY19 given strong economies of scale. It is also free cash flow positive helped by upfront collections and low capex,” Jefferies said in a note.