Buy IndiaMART; target of Rs 6290: Motilal Oswal

Motilal Oswal is bullish on IndiaMART recommended buy rating on the stock with a target price of Rs 6290 in its research report dated April 28, 2023.

Broker Research

May 02, 2023 / 15:04 IST

buy

Motilal Oswal's research report on IndiaMART

INMART delivered a strong performance in 4QFY23, with revenue up 33.5% YoY and 6.9% QoQ (in line). Collections grew 48% YoY to INR4.2b (4Q seasonality), suggesting good visibility of revenue growth for FY24. Deferred revenue rose 28% YoY to INR11.6b, which should support ~26% revenue growth in FY24, despite a high base of FY23. Paying subscriber additions (up 8.7k QoQ) were good. The EBITDA margin declined 330bp QoQ (in-line), primarily due to the impact of annual wage hikes, front-loaded incentives paid on higher collections.

Outlook

While we upgrade our numbers on good performance and outlook, we reduce our earnings estimates to adjust for minority interest outgo. We value INMART on a DCF basis to arrive at a TP of INR6,290 (a potential upside of 17%), assuming 12% WACC, and a 6% terminal growth rate, implying 39x FY25E EPS. We reiterate our BUY rating on the stock.

For all recommendations report, click here