InfoEdge - Q1FY21 First Cut - ICICI Securities

(CMP: Rs. 3292; MCap: Rs. 42,329 crore)

InfoEdge's Q1FY21 numbers were above our estimates. Despite a significant dip in gross margins 493 bps YoY (337 bps QoQ), tight control on advertising (down 841 bps YoY) and other expenses (down 156 bps YoY) led to higher than anticipated EBITDA margins. The company's billing is down 43.9% YoY in the quarter.

Q1FY21 Earnings Summary

- Revenue declined 10.4% YoY to Rs. 280.1 crore (above our estimate of Rs. 221.1 crore). Recruitment solutions declined 8.8% YoY to Rs. 200.2 crore (vs. our estimate of Rs. 142.7 crore) and 99 acres declined 24.7% YoY to Rs. 42.5 crore (vs. our estimate of Rs. 36.7 crore). However, other verticals grew 1.7% YoY to Rs. 37.5 crore (vs. our estimate of Rs. 41.7 crore)

- EBITDA margins increased ~504 bps QoQ to 37.3% (above our estimate of 14.5%) mainly led by lower advertising expenses (down 841 bps YoY) and other expenses (down 156 bps YoY) partially offset by 493 bps YoY decline in gross margins

- InfoEdge reported PAT stood at Rs. 83.2 crore. The company's adjusted PAT increased 11.1% YoY mainly due to better performance at operating level and lower tax expenses

The company reported healthy standalone margins despite a challenging quarter. Further on a consolidated basis the company's share of profits from joint ventures has been positive which we believe indicates absence of cash burn and marginal profits in Zomato. We would be keenly looking for the company's outlook on Zomato, acquisition due to fund raising, any new investments, the impact of drop in billing in the quarter and revival path ahead in the upcoming conference call. We would be revisiting our estimates and target price post the conference call.

Shares of INFO EDGE (INDIA) LTD. was last trading in BSE at Rs.3291.9 as compared to the previous close of Rs. 3337.65. The total number of shares traded during the day was 4808 in over 775 trades.

The stock hit an intraday high of Rs. 3385.7 and intraday low of 3275. The net turnover during the day was Rs. 15970087.

Source : Equity Bulls

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