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Last Updated : Apr 21, 2018 10:13 AM IST | Source: Moneycontrol.com

No need to divorce this stock; brokerage sees up to 26% upside on this wedding portal

The brokerage has initiated coverage on the stock and sees a 26 percent upside from its current levels, implying that it would offset all losses made so far.

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Citing favourable cues from untapped markets, consumer brand recall and expansion of services, Angel Broking said it is upbeat on Matrimony.com.

The brokerage has initiated coverage on the stock and sees a 26 percent upside from its current levels, implying that it would offset all losses made so far. It has a price target of Rs 984 on the stock.

Angel Broking highlighted how there were around six million active users in 2016, against an unmarried population of 107 million in the same year. Active seekers during the duration were seen at 63 million.

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"Currently, the company has 3.08 million active profiles on Matrimony.com. Hence, there is a huge untapped market opportunity for the company," the brokerage said in its report.

Further, apart from being the leading provider of online matchmaking services in India, it highlighted that the company has a high degree of brand recall and trust. "This is as evidenced by the average number of website pages viewed by unique visitors in June 2017 (comScore Report)."

But the bigger highlight in its business is its foray into marriage services, the broking firm said.

"The key strategy for driving monetization is to increase the length of relationship with customers and increase the amount of revenue earned from customers by offering additional wedding related services such as photography and videography, wedding apparel, venue, stage decorations, make-up, catering and honeymoon packages from various vendors to meet customers’ wedding needs," Angel Broking added in the report.

On the financial front, the brokerage expects Matrimony.com to clock a compounded annual growth rate of 15 percent in net revenue to Rs 450 crore over FY2018-20E, mainly due to strong growth in online matchmaking and marriage related services coupled by its strong brand recall and large user database.

In terms of profitability, Angel Broking expects a CAGR of 28 percent in net profit to Rs 82 crore over the same period on the back of margin improvement led by strong operating leverage and reduction in losses in the marriage service business.

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First Published on Apr 21, 2018 10:13 am
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