Q4FY25 revenue growth slowed to 7% YoY. EBITDA margin declined sequentially for the first time after seven quarters. Given the sustained pressure on revenue growth and all-time high EBITDA margin, the earnings growth outlook remains weak for FY26. Cash balance grew to ~INR 53bn. Management has announced earnings call for the first time after Q1FY25. We think investors would be keen to understand if management envisages growth revival in the near term and whether one should estimate ad-spends to ascend hereon – to address concerns around stagnating traffic to the platform. In Q1FY25’s earnings call, management had indicated that they were actively evaluating means to distribute incremental cashflows to shareholders. Any concrete clarification on the same could be a trigger for rerating.
OutlookWe maintain HOLD with a revised target price of INR 968 (earlier INR 1,028), based on 8x one-year forward EV/EBITDA multiple (FY27E).
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