IndiaMART InterMESH, an online marketplace for business products and services, which listed on bourses in July this year, has doubled investor wealth since then.
IndiaMART InterMESH, an online marketplace for business products and services, which listed on bourses in July this year, has doubled investor wealth since then. In just six months, the stock has risen as much as 120 percent from its issue price of Rs 973 per share to Rs 2,143 currently.
The stock listed at Rs 1,180. Since listing, the stock has gained nearly 82 percent. It hit its 52-week high of Rs 2,310 on October 10, 2019, and a 52-week low of Rs 952 on August 28, 2019.
The IPO of the company was carried out from June 24 to June 26 in a price band of Rs 970-973 per share. The initial public offering of IndiaMART received an overwhelming response from all investors with a subscription of 36.16 times.
The company, however, posted a 55 percent decline in consolidated net profit at Rs 9 crore for the September quarter, mainly on account of change in tax rate and regulations. The company had posted a profit of Rs 20 crore during the same period of 2018-19.
In an interview with CNBC-TV18, Dinesh Agarwal, founder and chief executive officer of IndiaMART InterMESH said, "We have seen that the incremental growth in the deferred revenue has slowed down considerably over the last two quarters and that’s probably going to show up in the revenue over the next couple of quarters if the economic conditions do not improve substantially quickly," Agarwal revealed that growth will be lower than the 25 percent target.
Recently, global brokerage house, Jefferies initiated coverage on the stock with a buy call and target price of Rs 2,500, implying a 26 percent potential upside from current levels.
"It is the dominant B2B classified platform in India. It has strong moats to defend it against the competition," it said, adding that it expects a 20 percent revenue CAGR over FY20-22 despite macro headwinds.
Jefferies also believes that the margin should expand to 28 percent by FY22 from 16 percent in FY19. The brokerage sees multiple growth drivers for the company which should help drive 20 percent revenue CAGR over FY20-22 despite macro headwinds related to the economic slowdown.
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First Published: IST