Buy Infibeam Avenues; target of Rs 33: KR Choksey

KR Choksey is bullish on Infibeam Avenues has recommended buy rating on the stock with a target price of Rs 33 in its research report dated November 13, 2024.

Broker Research

November 14, 2024 / 09:47 IST

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KR Choksey's research report on Infibeam Avenues

Infibeam Avenues Q2FY25 reported better than anticipated earnings. Gross revenue stood at INR 10,167 Mn, increased by 29.2% YoY (+36.5% QoQ), primarily driven by robust growth in the payment business. EBIT stood at INR 613 Mn, up 14.4% YoY (+16.5% QoQ), beating our estimates. EBIT Margin declined to 6.0% in Q2FY25 (-78bps YoY/-103bps QoQ) because of increased operating expenses and higher other expenses. Net Profit stood at INR 475 Mn, up 16.7% YoY (-31.7% QoQ). The QoQ decline in PAT is attributable to lower other income and higher tax rates. PAT margin stood at 4.7%, down 50bps YoY (-465bps QoQ). We increase our FY26E Gross revenue to INR 53,673 Mn (previously: INR 51,550 Mn) underscoring INFIBEAM’s ability to maintain doubledigit NTR for FY25E, further supported by robust growth in the payment business and accordingly arrive at FY26E EPS of INR 0.97. We introduce P/E multiple instead of EV/Gross Sales, given its greater suitability and precision in accurately assessing the company’s value. We expect FY26E EPS of INR 0.97 and assign a P/E multiple of 35.0x.

Outlook

Accordingly, we reduce our TP to INR 33.9 (previously: INR 37.6). At current levels, the stock offers a potential upside of 27.9%. Consequently, we maintain a “BUY” rating on the shares of Infibeam Avenues Ltd.

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