Buy IndiaMART; target of Rs 3250 : Motilal Oswal

Motilal Oswal is bullish on IndiaMART recommended buy rating on the stock with a target price of Rs 3250 in its research report dated October 27, 2023.

Subhash Helgaokar

October 30, 2023 / 15:08 IST

Buy

26 Aug, 2025 12:21

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Motilal Oswal's research report on IndiaMART

IndiaMART (INMART) delivered a strong 2QFY24 performance, with revenue growth of 22.5% YoY/4.5% QoQ (in line). Collections jumped 28% YoY to INR3.3b, suggesting healthy visibility of revenue growth in FY24. Deferred revenue rose 26% YoY to INR12.4b, which should support ~23% YoY revenue growth in FY24E, despite a high base of FY23. EBITDA margin declined 30bp QoQ (70bp miss), driven by higher-than-expected employee costs. Customer addition was at a multi-quarter low of 2k (vs. normal range of 6- 8k) on account of lower gross adds due to price hikes and higher-thanexpected churn. The management remained cautious about higher churn and refrained from providing guidance on net additions in the near term, and suggested that it will take some time for churn to normalize. However, despite muted expectations for subscriber additions, they remain confident of maintaining collection growth at 22-23%.

Outlook

We lower our FY24E/FY25E earnings by ~3.5% to account for lower subscriber additions and margin miss. We value INMART on a DCF basis to arrive at a TP of INR3,250, assuming 12.5% WACC and a 6.5% terminal growth rate. We reiterate our BUY rating on the stock.

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