What keeps Mark Mobius bullish on MapMyIndia? A deep dive into geospatial space

Mobius expressed optimism about the company’s great work in mapping and location technology in an earlier post on LinkedIn

Shares of geospatial companies like CE Info Systems and Genesys International have been gaining traction in recent days amid expansion plans. Since both players stand as primary representatives of India’s mapping industry, analysts expect domestic mapping companies to benefit over foreign entities like Google Maps, as current regulatory policies limit geospatial data access to the latter.

Emerging markets expert Mark Mobius has been a long-term advocate of CE Info Systems, which operates under the brand name MapMyIndia. Mobius expressed optimism about the company’s great work in mapping and location technology in an earlier post on LinkedIn.

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Founded in 1995 by husband-and-wife duo Rakesh and Rashmi Verma, MapMyIndia has mapped all of India over the course of these years.

In the financial year 2022-23, its order book grew by 31 percent year-on-year (YoY). The company recently approved raising up to Rs 500 crore via a qualified institutional placement (QIP) to expand its geo-tech division.

On the other hand, Genesys International, a Mumbai-based mapping company, collaborated with the Survey of India, one of the oldest mapping companies in India, to create digital twins of major cities and towns.

In the past month, the stock of MapMyIndia soared over 23 percent, while Genesys International surged 10 percent.

New geospatial policy: a booster for mapping stocks
Vinit Bolinjkar, Head of Research at Ventura Securities, primed MapMyIndia and Genesys International to be two of the biggest beneficiaries of India’s new geospatial policy introduced in December 2022.

“A unified framework chalked out in the new geospatial policy will contribute to India’s transition to a digital economy and enhance services for its citizens. MapMyIndia and Genesys International, thus, would stand out as primary representatives in India’s map content industry and will be poised for significant growth under the new policy,” added Bolinjkar of Ventura Securities.

The policy aims to develop a national geospatial data framework, enabling the easy availability of data to businesses and the general public. By 2025, the government aims to put in place a legal framework to support the liberalisation of the geospatial sector.

ALSO READ: MapMyIndia approves QIP worth Rs 500 crore

Regulatory advantages for Indian mapping companies vs foreign players

Apart from the government’s new geospatial policy, analysts believe that additional regulatory requirements specifiy certain geospatial data to be  only be owned by Indian entities instead of foreign companies.

The foreign companies would need a licence from Indian players to serve their Indian customers.

For instance, geospatial data with a spatial accuracy of one metre for horizontal and three metres for vertical cannot be created or owned by foreign entities, said analysts. This feature is important to create accurate maps for ADAS, HD, and 3-D mapping.

Even for internet giant Google, it took more than a decade to relaunch its Street View after the service was suspended due to its failure to secure the requisite security clearances from the government.

The re-launch of Street View by Google Maps only became a reality once it partnered with two local firms, Genesys International and Tech Mahindra, to view panoramic and street-level 360-degree views of a place.

“Several mapping activities, such as the terrestrial mobile mapping survey, the 360-degree street view survey, and the Indian territorial waters survey, have also been reserved only for Indian entities. Indian companies like MapmyIndia and Genesys stand to benefit from this as it would help them to have an additional regulatory advantage over their global competitors (such as Google Maps),” added Bolinjkar of Ventura Securities.

ALSO READ: Envision’s Nilesh Shah feels MapmyIndia can add value in the long-term

MapMyIndia, Genesys International – analysing business moat

MapMyIndia, founded nearly three decades ago, created digital maps of India long before Google Maps changed web cartography.

The company outlined India’s megacities by foot and charted streets and landmarks. With over 250 new customers, MapMyIndia's customer base was expanded over 850 on MaaS, SaaS, and PaaS platform in FY23. Some of their key clientele include ISRO, Ministry of Electronics, Ministry of IT, and Ministry of Road Transport and Highways.

On the other hand, Genesys International is a Mumbai-based mapping company providing advanced mapping, survey, and geospatial services.
With a team of over 2,000 professionals, the company delivers services in the Geographical Information System (GIS) and Geospatial Engineering domains.

Financially, MapMyIndia’s topline has compounded at 20 percent in the span of three years, while Genesys International’s topline has compounded at a rate of 17 percent, according to the data.

During this period, the bottomline of MapMyIndia has compounded by 72 percent and that of Genesys International by 67 percent.

ALSO READ: Genesys International ties up with Survey of India to transform mapping in country

Investment rationale

In terms of valuation, both MapMyIndia and Genesys International have exhibited mixed trends, said analysts. Sonam Srivastava, Smallcase Manager and founder research at Wright Research, suggested investors approach these growth stocks with significant risks in mind, such as market volatility, technological disruptions, and competitive dynamics.

Since MapymyIndia has entered into various memoranda of understanding (MoU) with key government organisations such as the ISRO, NITI Aayog, National e-Governance Division, and Ministry of Electronics & IT, among others, future growth prospects are reflected in the expensive valuations of the company, said Bolinjkar.

“At the current market price (CMP) of Rs 2,179 per share, MapMyIndia is trading at TTM EV/EBITDA of 69 times (x) and FY25 EV/EBITDA of 53.4x. We recommend to accumulate this stock on dips,” he added.

Meanwhile, Genesys International’s recent tie-up with Survey of India has brought cheer to the stock. “At the CMP of Rs 363 per share, Genesys is trading at TTM EV/EBITDA of 25.7x, offering scope for re-rating. Investors could capitalise on the opportunities in this evolving sector,” Bolinjkar added.

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