Buy MapMyIndia; target of Rs 1700: Anand Rathi

Anand Rathi's research report on MapMyIndia

MMI is the leading digital mapping operator in India. Its B2B and B2B2C focus makes it less visible vs B2C focussed Google map. Yet, we feel that the revenue model based on fees charged per period (on per vehicle, per asset, per transaction, per use case, per user) is superior to Google (only advertisement based). In the context of business in India, MMI has clear advantages, not easily replicable, and which prove to be high barriers to enter the map and navigation business in India. Its diverse use of maps across a variety of platforms, products and applications is much more than those of its peers (because of this ~90% of its larger customers generating more than ~80% of revenue have been retained over the years).

Outlook

We estimate 39.2%/42% revenue and EBITDA CAGR over FY22-FY24 and initiate coverage on MMI with a Buy rating and a TP of Rs.1,700 (valued at 50x FY24 earnings).